Pandora Shares Sink After Closing Bell on Weak Guidance
Joe Kennedy, CEO of the Internet music company, says the "fiscal cliff" is worrying advertisers.
Shares of Pandora were plunging as much as 19 percent in after-hours trading Tuesday after the Internet music company reported a third-quarter net profit but warned that it would lose money in the current quarter.
CEO Joe Kennedy also cited the "fiscal cliff" as a concern among advertisers, which is making it difficult for Pandora to accurately predict its upcoming revenue.
"What we really experienced over the past couple months is increase in caution from advertisers about macroeconomic concerns -- the fiscal cliff, particularly, in January -- and that really is the difference between what we know now and what we knew three months ago when we last gave guidance," Kennedy said Tuesday.
Shares of Pandora rose 5 percent during the regular session to $9.45 but were sinking by about $1.80 after the closing bell.
Pandora reported a 60 percent rise in revenue in the third quarter to $120 million and a nickel a share in profit, beating the expectations of analysts on both measures.
In the fourth quarter, though, Pandora predicted up to $123 million in revenue and a net loss of up to 9 cents a share, while Wall Street was expecting $130 million in revenue and a penny in per-share profit.