Demand Media Beats Expectations Slightly in Q4 Report; Buying Back More Stock; CEO: “Turbulent Year”
Demand Media, which has suffered from stock weakness and worries about its traffic and costs, beat Wall Street expectations in its fourth quarter earnings report, which was released after the market closed today.
The Santa Monica, Calif., online media company said it earned eight cents per share, up one cent on analysts’ estimates of seven cents. Revenue came in slightly higher too, at $84.4 million compared to an expected $81.95 million.
Still, Demand shares were down almost five percent in after-hours trading on the news, to $5.94.
Demand said that about $50 million of that came from its content businesses, while just over $31 million was due to its registrar business.
Free cash flow was up five-fold from $3.3 million to $18.3 million, which Demand said was due to cost controls and decreased spend on its flagship eHow site, which has seen changes in its content and distribution platform.
Demand also said it is going to buy back more of its stock, upping a $25 million plan to $50 million.
Said the company:
“During the fourth quarter of 2011, Demand Media repurchased 1.9 million shares of common stock for $13.3 million under its Board-authorized $25.0 million share repurchase program. To date, the Company has repurchased 2.8 million shares of common stock for $20.1 million. On February 8, 2012, Demand Media’s Board authorized an increase of $25.0 million to the program, taking its total authorized repurchases to $50.0 million.”
In a conference call with analysts after the reports, CEO Richard Rosenblatt acknowledged it was a “turbulent year,” but noted that Demand would be enhancing its properties for higher page views and more direct traffic.
He also addressed the departure of some of Demand’s founders. “All three were very important members of our team,” he said. “But it’s the natural evolution of a young company.”
If you want more deets, read all about it here in the company’s official press release: