Angie's List stock sinks on quarterly loss, downgrades

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Shares in Angie's List Inc. sank 24 percent from Wednesday's closing price after the company reported a bigger-than-expected loss in the second quarter.

At least seven Wall Street analysts downgraded the stock Thursday.

The Indianapolis-based online consumer-reviews service suffered a loss of $18.4 million, or 31 cents a share, compared with a loss of $14.3 million, or 25 cents a share, a year ago.

Analysts had predicted a loss of only 24 cents per share.

Shares dropped $1.84 each, or 18.1 percent, to $8.33 each in after-market trading Wednesday following the earnings release. The stock continued to slide Thursday morning, falling as low as $7.77 before climbing to $8.22 in the early afternoon.

Revenue increased 33 percent, to $78.9 million, missing the company's expectation of $79.5 million to $80.5 million.

Angie's List said total paid memberships reached 2.8 million as of June 30, a rise of 31 percent over a year ago.

But the company spent more to attract  those members. Selling expenses jumped nearly 38 percent and  marketing expenses rose 28 percent.

The stock fell nearly 4 percent in regular trading earlier Wednesday and is down about 45 percent since the start of the year.

Angie's List said it expects revenue in the range of $80.5 million to $82.5 million in the third quarter, below analyst expectations of $86.6 million.

"We reported solid results for the second quarter while continuing to invest in our marketplace," Angie's List CEO Bill Oesterle said in a prepared statement. "We increased marketing spending during a seasonally strong period and had a record quarter in gross new member additions, which we believe reflects the continued resonance of our value proposition."


  • Finally!!
    I'm a small business owner in Indy, and is my first time reading other peoples comments about AL. Finally!! I've discovered that there are other people who see what I see. Every time I see a commercial it's laughable to me considering they've never turned a profit. Nonetheless, you have to give them credit for having a great marketing strategy. They may not be profitable, but they're convincing millions of people to invest and become a member. $75 million in revenue is nothing to sneeze at... Furthermore, I would never pay a company to post my business reviews. We currently allow each customer to post their good or bad experience, including photos, on our website and we spend our money on driving our specific customer to our site.
  • correction
    You must have meant it has NEVER been voted a great place to work. Trust me, that'll never happen.
  • Still a Good Idea
    Angie's list is still a good idea, I have used them since they were unified neighbors. The coupon ads are annoying, but I suspect you may still use Google even though they show you ads first. I get detailed feedback from real people (not just potential shills). I get connected with responsive companies that do professional work that I would have never found otherwise. If you are satisfied with food reviews from Trip Advisor (buckets of food, low price, 5 stars!), then I am sure you would be satisfied with NOT using Angie's List. But one comment was closer to the mark, that the original owners are cashing out at investors expense.
  • Well said!
    I initially came here to post about this joke of a company and its hilarious business model, lack of profitability, and the dopes who have bought their equity and enriched Angie. However, the comment below said it perfectly.
  • Joke
    I love the headline - "Larger than Expected Losses". I expected losses for the last three years! This joke of a company has never turned a real cash profit in its entire existence. Bill and Angie have laughed all the way to the bank over the past three years at "investors" that have been willing to pay $15 - $20 for a share of this stock. It's a shame that these two have been made multi-millionaires for being completely inept at how to make money.
    • Bad Service
      I tried AL last year and was very quickly dissapointed. I was bombarded with AL the "big deal" emails and surprised how their search organized to those with coupons first. If I'm paying for a review service, I don't care if they have a coupon or offer me a package groupon type of deal. I want the best service. If they want to continue to essentially sell business promotions to the highest bidder, then they need subscriptions to be free for the actual consumers.
    • Huh
      They've never had a profit so if that's their goal, epic fail. And Angie's List has been voted one of the best places to work, so it's not just "executive salaries" that are to blame. The problem with Angie's List is, why would anyone pay for their service when it can be found elsewhere for free?
      • No longer a consumer organization
        While Angie's brings good employment and tax revenues to the state, it ceased being a consumer organization several years ago when profits and executive salaries became the goal and they began to sell listing advantages to the vendors.
        • Whoops!
          Maybe they shouldn't be throwing money at the IRL or whatever they call it now. Probably should save that money for actual operations.

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