October 28, 2009 / 2:40 PM / 10 years ago

ValueClick shares plunge on weak Q4 revenue view

BANGALORE, Oct 28 (Reuters) - Shares of online advertising firm ValueClick Inc VCLK.O plunged 19 percent on Wednesday, a day after the company reported strong third-quarter results but guided fourth-quarter revenue below analyst expectations.

Revenue at comparison shopping segment rose 7 percent sequentially but fourth-quarter outlook for this segment reflects negative sequential revenue growth due to the impact of recent changes by one of our large customers, Chief Executive Tom Vadnais said on the conference call on Tuesday.

“This customer is now focusing more on its owned-and-operated channels and de-emphasizing the distribution channel where it works with us and many other partners,” Vadnais said.

Weak outlook for comparison shopping segment — down 15 percent sequentially in the fourth quarter — due to pullback by a large customer, raises a new challenge, Citigroup analyst Mark Mahaney said in a note.

The longstanding concern that the company’s display segment will face increased competition from Yahoo YHOO.O and Google (GOOG.O) is more likely to play out over next few quarters, Mahaney added.

ValueClick expects revenue of $134.5 million to $138.5 million for the fourth quarter, compared with analysts estimates of $140.77 million. [ID:nBNG535036]

Shares of the company were trading down 18 percent at $10.26 Wednesday morning on Nasdaq. They had touched a low of $10.10 earlier in the session, making the stock one of the top percentage losers on the exchange. (Reporting by Mansi Dutta in Bangalore; Editing by Unnikrishnan Nair)

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