* Says rev from Yahoo lower than expected in Q4
* Says Bing charging less for revenue per click
* Cuts Q4 outlook; cautions about Q1
* Acquires group-buying platform iTwango
* Shares down 21 pct
(Adds details, updates share movement)
Jan 7 Local-search provider Local.com Corp
LOCM.O said its revenue model was under pressure following
partner Yahoo Inc's YHOO.O move to Microsoft Corp's (MSFT.O)
Bing search engine, sending Local's shares tumbling 21 percent.
Bing is charging advertisers less for Local's search
traffic, which resulted in less revenue per click (RPC) than
what Yahoo had paid prior to the integration of its search
engine with Microsoft, the company said in a statement.
The company, which throws up search results for local
businesses, products and services, cut its fourth-quarter
outlook and said it expects limited visibility for the next
quarter or two.
"It may take several more months for us to adapt our
business to the Yahoo-Bing integration and to execute a variety
of strategies," Chief Executive Heath Clarke said.
The company cautioned that if it is unable to improve RPC
in the near term, 2011 first quarter revenue and adjusted net
income may be even lower than current fourth-quarter
The company now sees fourth-quarter adjusted earnings of 19
cents a share on revenue of $19.9 million, down from its
previous forecast of 20-21 cents a share on revenue of $22-$23
Clarke said a part of the company's strategy going forward
was "to diversify our ad products and technology platforms, as
evidenced by our just-announced entry into the group-buying
On Friday, Local said it acquired privately held
group-buying platform iTwango LLC for an undisclosed amount.
Group-buying, as practised by services like Groupon, is the
purchasing of discounted or special offers from a business by a
minimum number of buyers.
Retailers like Amazon.com (AMZN.O) and eBay Inc (EBAY.O)
are increasingly investing in local platforms to attract group
buyers, as customers flock online for deals and discounts.
Shares of Irvine, California-based Local.com were trading
down 21 percent at $5.60 on Friday on Nasdaq.
(Reporting by NR Sethuraman in Bangalore; Editing by Sriraj