Responsys, Demand Media shares up on strong revenue outlook

BANGALORE Wed Aug 10, 2011 10:52am EDT

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BANGALORE (Reuters) - Shares of Responsys Inc MKTG.O rose 23 percent in early trade on Wednesday, a day after the company gave a better-than-expected revenue outlook for the coming quarter.

The company, which provides email and cross-channel marketing, expects third-quarter earnings of 3 cents a share, excluding items, on revenue of about $33.5 million.

Analysts, on average, are expecting earnings of 3 cents a share, excluding items, on revenue of $31.3 million, according to Thomson Reuters I/B/E/S.

The company is well positioned to take advantage of the shift of advertising dollars from offline to online channels, catering to clients like Facebook and LinkedIn, JMP Securities said in a note.

Shares of Demand Media Inc (DMD.N) also rose 20 percent, after the company gave a full-year revenue outlook, the upper end of which was above analysts' estimates.

Demand Media, an online company, relies on freelance writers to provide articles and videos designed to appear at the top of Internet searches that in turn generate ad revenue.

Its shares, after trading up as much as $10.75, were trading at $10.23 on the New York Stock Exchange on Wednesday.

Shares of San Bruno, California-based Responsys, after rising up as much as $15.99, were trading at $14.90 on Nasdaq.

(Reporting by Sruthi Ramakrishnan in Bangalore; Editing by Sriraj Kalluvila)

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