Will IAC/Interactive Earnings Get Its Stock Back On Track? (IACI)

IAC/Interactive (NASDAQ:IACI) reported earnings that the wires are looking at as lower, although the actual numbers were above what Wall Street was looking for on the earnings front.  The company posted $1.515 Billion in revenues and adjusted EPS of $0.37. First Call had estimates at $0.35 EPS and revenues at $1.52 Billion.

The company also repurchased some 8 million shares during the quarter at an average of $27.54 and its OIBDA was $173 million.  The truth is that revenues were up even though net income on an EPS basis was lower when compared to Q3 2006.  The Associated Press unfortunately is reporting the $0.24 "GAAP" EPS as the drop instead of the adjusted EPS and this may be creating some confusion to some who only use the web for information on earnings and news instead of private systems.

Barry Diller, Chairman/CEO (and one of our "most entrenched corporate leaders")said, "With the exception of LendingTree, this was a satisfactory quarter for IAC. Trends at our businesses are good, and particularly so at HSN, where I believe that Mindy Grossman and her team have now become acclimated and are beginning to demonstrate the great retailing smarts that we knew they were capable of."

So far Wall Street is accepting these numbers because shares are up almost 2% on fairly thin pre-market trading volume at $28.90.  Its 52-week trading range is $25.08 to $40.99.

Here was a brief explanation by the company: Third quarter revenue wasdriven by increased year-over-year contributions from the Retailing,Media & Advertising, and Membership & Subscriptions sectors.Retailing revenue grew slightly; however, HSN revenue grew 5%,excluding America’s Store. Transactions sector revenue reflects stronggrowth at Ticketmaster, offset by a decline at LendingTree, whichcontinues to operate in a difficult home loan market. Syndicated searchand Fun Web Products drove strong revenue growth in Media &Advertising. Increased transaction volume and membership at Intervaland higher revenue per subscriber at Match benefited Membership &Subscriptions revenue.

Jon C. Ogg
October 31, 2007