FriendFinder Shares Plunged: What You Need to Know
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What: Shares of adult website operator FriendFinder Networks (NAS: FFN) were losing stock market friends today as investors knocked shares down as much as 18% in intraday trading after the company reported disappointing second-quarter results.
So what: It's a pretty simple story here. Investors were expecting one thing from the company's second-quarter financials, and what the company delivered was decidedly worse. On the top line, quarterly revenue declined 1.4% from last year to $83.4 million. Net income was blasted into the red by debt-extinguishment costs and a legal settlement. Even backing out those charges though, it's likely that FriendFinder still would have reported a loss. Wall Street was expecting $0.14 in (positive!) per-share earnings on $87 million in revenue.
Now what: Though the results of the company's Internet division fell from last year, it appears to be a profitable, attractive business line. However, combine that with high overhead costs and a very hefty debt load and we're left with a company that I would rather not be pals with.
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