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Digital River 1Q net profits fall; 2Q outlook weak

Thu, 04/29/2010 - 3:30pm
The Associated Press

Digital River Inc., which provides technology and services for companies that sell products online, said its first-quarter net profit fell 48 percent as costs rose and revenue fell.

While the results still beat expectations, its profit forecast for the second quarter was less than half of what analysts had hoped.

Shares fell $1.38, or 4.4 percent, to $29.90 in after-hours trading Thursday, after closing up 81 cents, or 2.7 percent, at $31.28.

Net profit in the three months to March 31 dropped to $7 million, or 18 cents per share, from $13.3 million, or 36 cents per share, in the same period a year ago.

Excluding stock-based compensation expenses and the amortization of intangible items from acquisitions, earnings per share amounted to 30 cents, above the 22 cents expected by analysts.

Revenue dropped 4 percent to $98.7 million from $102.9 million, but bested analysts' expectations of $97.5 million.

However the company said it expects second-quarter adjusted earnings of 5 cents per share, far below the 12 cents expected by analysts.

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