IAC reported its Q2 earnings numbers today, and its net income fell 90 percent to $53.8 million, from $618.1 million in the year-ago period. Revenues increased 18% to $1.6 billion. The year-ago profit figure included a $322.1 million after-tax gain on the sale of the company’s interests in Vivendi Universal Entertainment.
Ask.com has been a bright sport for IAC, and the strategy seems to have worked, to some degree, this story says. The search engine has climbed from its perennial fifth-place ranking to fourth place recently, supplanting AOL. Next in its sights is MSN search, ranked third. IAC’s Search and Media segment, which includes Ask.com and Citysearch, increased revenue by 21 percent over last year, largely due to revenue growth at Ask.com in the U.S.
ClickZ: Earlier this year, IAC announced it would spend considerably more on marketing this year, which is reflected in a $13.1 million decline in profits in the media and advertising businesses. IAC has also upped its revenue-sharing payments to traffic providers. Efforts to integrate Ask.com with its other online properties continued during the quarter. Doug Lebda, IAC’s president and COO, has been tasked by Diller to seek ways to increase the synergy between businesses. A first step, deploying an Ask.com search box on all sites, has already contributed to Ask’s search volume, Lebda said.
More in earnings release here.
From the conference call transcript (by SeekingAlpha): Some more details about Ask: We continue to be in investment mode for IAC search and media and are not focused on current profitability, as we are working to drive volume and share growth while being mindful of creating the business that will scale to real profitability over time.
On UK’s decline for Ask.co.uk: U.K. was very over-monetized. The stand-alone Ask business was doing a lot of revenue and it was one of the key things where they met their quarter. They were — I do not know how many links they had on a page, but I do not think they had anything but paid links. We took that down recently. That really hurt revenue. We also had a number of problems in the market that were — some were infrastructure, some were other marketing issues, et cetera. Recently, we have had real improvement in the U.K. It is not back to anything that you would call robust, but it is certainly on the way.
Subscriber content
?
Subscriber content comes from Gigaom Research, bridging the gap between breaking news and long-tail research. Visit any of our reports to learn more and subscribe.
Advertisement
Advertisement
Advertisement
Comments have been disabled for this post