Digest: IAC 'stalled'; RealNets dips
Internet conglomerate IAC/InterActiveCorp. posted disappointing quarterly results Tuesday on lower revenue at its key HSN shopping channel and unexpected weakness at its Ticketmaster boxoffice service, sending shares down 5.3% to $28.74. IAC, controlled by CEO Barry Diller, said second-quarter profit rose 78% to $96 million, but earnings excluding special items were below Wall Street expectations. Diller described the company's growth as "temporarily stalled." Gross margin pressure at HSN likely will keep profit flat in the third quarter, with year-over-year growth expected to resume in the fourth quarter, IAC executives said.
RealNetworks Inc. posted a decline in quarterly profit Tuesday after the digital-media company could not match year-ago results that were boosted by a legal settlement with Microsoft Corp. Second-quarter net income was $1.3 million, compared with $38.9 million a year ago. In the year-ago quarter, the company benefited from the proceeds of a $57.9 million settlement of litigation against Microsoft and commercial agreements with the world's largest software maker. Revenue rose 5% to $136.2 million, helped by a strong performance from its games and digital-music subscription business.
Apple shares sunk 6.8% on Tuesday to $131.76 on speculation that it might cut production of either the iPhone or iPod. But while a Miller Tabak report led to the speculation, citing talk among traders, other analysts dismissed the information as unfound rumor. Separately, Apple said Tuesday that it sold its 3 billionth song since launching iTunes four years ago. The company sold its 2 billionth song six months ago.