Summary:

IAC (NSDQ: IACI), which rejiggered its operations during the most recent quarter, laying off employees at its search business and swapping E…

IAC
photo: IAC

IAC (NSDQ: IACI), which rejiggered its operations during the most recent quarter, laying off employees at its search business and swapping Evite and Gifts.com for Liberty Media’s holdings in the company, posted a better-than-expected 27 percent increase in sales. All of the company’s business units reported increases in revenue for the second quarter in a row. Match.com, which only a year ago was being dismissed in news outlets — including by us — as a site that was losing ground to free rivals led the way with a 30 percent increase in revenue. The company’s search unit was up 29 percent, while sales at its “media and other” unit, which includes the Daily Beast, College Humor and Vimeo, were up 28 percent.

Still, the company’s profits did not match expectations. On average, analysts had expected earnings per share of 34 cents, but IAC reported earnings per share of 26 cents. Losses at the company’s “media and other” unit more than doubled in part due to “increased operating expenses at The Daily Beast and transaction expenses associated with the formation of its joint venture with Newsweek.” (IAC merged The Daily Beast with Newsweek in November.) And corporate expenses increased in part due to transaction expenses related to the company’s swap with Liberty Media.

Overall, IAC’s sales increased to $451.4 million, up from $355.7 million during the fourth quarter of 2009. Net income was $87 million, a turnaround from the comparable quarter a year ago when IAC posted a $1.012 billion loss because of a one-time $991 million charge it took to write down the value of its Ask.com search business. On average, analysts had expected revenue of $429 million.

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