CNET Posts Sobering 2nd Qtr. Results

SAN FRANCISCO — CNET Networks Inc. reported a wider net loss in the second quarter, trimmed future expectations and said it will cut about 15% of its nearly 1,900-person work force in the third quarter.

The Internet media firm had a net loss of $218.1 million, or $1.60 a share, compared with a year-earlier pro forma net loss of $168 million, or $1.24 a share. Last year’s results assume CNET owned ZDNet during all of 2000; the acquisition took place on Oct. 17.

Excluding acquisition-related expenses, business-integration expenses, realized gains/losses on investments and income taxes, CNET said it would have lost $23.4 million, or 17 cents a share, compared with a year-earlier loss from operations of $5 million, or four cents a share.
Revenue slumped 32% to $71.1 million.

When the company reported its first-quarter results in early May, CNET warned that second-quarter revenue at best would be flat with the first quarter’s $75.2 million. The company also said its loss from operations would likely widen from the first quarter’s 13 cents a share.

The job cuts are likely to be completed by mid-September, CNET said in a prepared statement.

Going forward, CNET is forecasting third-quarter revenue of $70 million to $75 million and fourth-quarter revenue of $75 million to to $80 million. For the full year, the company trimmed its revenue target to a range of $290 million to $300 million from April’s estimate of $310 million to $328 million.

CNET’s losses from operations are projected to be 14 cents to 19 cents a share in the third quarter and eight cents to 13 cents a share in the fourth quarter. The mean estimates of analysts surveyed by Thomson Financial/First Call were for losses of 14 cents and eight cents, respectively.

CNET provides information and commerce services for the technology industry.

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