Shares of Interchange Corp. took a hit after the company posted quarterly results Tuesday that fell short of Wall Street expectations and reported a weak outlook for the first quarter.
Interchange, which operates paid Internet search engines such as local.com, reported sales of $3.4 million in the quarter, down from $6 million a year ago. Analysts were looking for about $3.7 million in revenue.
The company posted a loss of $3 million, compared to a profit of $1.2 million a year earlier.
Shares were down about 8% to $4.67 Wednesday.
Interchange said it plans to focus more on its local search operations. Local search revenue was about $600,000 in the fourth quarter, compared to sales from national search operations of $2.8 million.
“Overall, 2005 was a transitional year in which we faced many challenges in our national search business,” said Heath Clarke, Interchange chief executive. “In 2006 we are focusing on capitalizing on the significant opportunities in local search. Our vision is to make Local.com No. 1 in local search.”
The company expects first quarter revenue to be $3 million to $3.2 million, down 6% to 13% compared to the fourth quarter.
The bright spot: Local search is expected to bring in $900,000 to $1 million in sales, up more than 50% from the fourth quarter.
Interchange went public in 2004, with its shares jumping more than three-fold in the days after its debut. Since then, it’s been mainly downhill on Wall Street for the company, which counted a market value of about $40 million at recent check.
