Pandora Profits In Q3, But Q4 Loss Forecast Hurts Stock
December 4, 2012 at 3:56 PM (PT)
PANDORA MEDIA INC. reported that its Q3 net profit more than tripled to $2 million as revenue rose slightly faster than costs. At the same time, it predicted a loss in the fourth quarter, which sent it stock price tumbling, reports THE WASHINGTON POST.
Revenue rose 60% to $120 million, higher than analyst expectations of $117 million. Q3 Net income was a penny per share. Excluding the cost of compensating executives with stock, adjusted earnings came to 5 cents per share, beating analyst predictions of a penny per share.
However, PANDORA predicted a loss in the fourth quarter of between 6-9 cents per share -- far worse than the penny-per-share profit analysts wanted. CEO JOE KENNEDY blamed the future losses on tax increases emanating from the fiscal cliff. "We are seeing advertisers becoming more cautious over the last couple of months with both macroeconomic concerns and ‘fiscal cliff’ issues," he said, adding that the company is also hiring more local radio ad sales people, which should increase expenses initially, but "Those are investments that have a clear pay-off next year and beyond."