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Angie's List turns quarterly profit, but shares fall

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Shares of Angie’s List fell sharply in after-hours trading Wednesday evening after the Indianapolis-based company disclosed fourth-quarter profit that fell short of analysts’ expectations.

Although the firm reported a rare profit of $2.8 million, or 5 cents per share, analysts polled by Thomson Reuters anticipated 13 cents. Soon after the earnings release late Wedneday afternoon, shares had tumbled $2.51—more than 14 percent.

The provider of consumer-written reviews of service companies beat analyst revenue estimates of $68.5 million, coming in at $68.8 million. That was an increase of 49 percent over revenue in the same quarter last year.

Revenue growth came mostly from service providers, whose contribution rose 57 percent from the same quarter last year to $51 million. The company also said its growing e-commerce business—a segment of service-provider revenue—generated $6 million during the quarter, an increase of 72 percent.

Membership revenue rose 29 percent, to $17.7 million.

"We are reporting a solid fourth quarter capping a year that included many significant milestones," said Angie's List CEO Bill Oesterle in prepared comments. "We executed well on our strategic objectives in 2013, including making meaningful investments in our products and technology, strengthening our ability to monetize our membership through our marketplace initiatives, and delivering excellent improvements in operating leverage."

For 2013, Angie’s List lost $32.9 million, or 57 cents a share, compared with a loss of $52.9 million, or 92 cents, in 2012. Revenue in 2013 hit $245.6 million, a 58-percent increase from $155.8 million in 2012.

The company spends heavily on marketing to expand into new markets and to build out existing markets that tend to become more profitable with time. It faces growing competition from such sites as Yelp, which don't charge consumers membership fees.

Since December, three lawsuits have been filed against the company in federal court, alleging executives haven’t been forthcoming about an evolving business model that now relies mostly on advertisements from the service providers its members review.

The suits contend that officers and directors last year provided a rosy picture of the company’s prospects even as they sold some of their own shares and conducted membership-pricing experiments that suggest the company's growth prospects may be limited.

 

 

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  • continually AMAZED
    How is it that a company that has NEVER turned a profit can rate other businesses ? Continually failing their stockholders and investors? Don't they have something they call "the penalty box? maybe they need to police themselves.
  • Not worth it
    Aside from its inability to make a profit, "Angie" seems to lay off or fire as many people as she hires. The only people who really seem to benefit is Angie and her helpers in the executive suite. Maybe the reason for the lack of profits is the business model just doesn't work. And, that can't be good for their reviews.
  • No Good
    Angies List has Never generated a profit, who would put their money on this loser?

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  1. Now if he'd just stay there...

  2. Daniel - what about the many US citizens who do NOT follow what the Bible teaches? The Hindus, Jews, Muslims and others who are all American citizens entitled to all rights as Americans?? This issue has NOTHING to do with "What the Bible says..." Keep all Churches separate from State! Pence's ongoing idiocy continues to make Indiana look like a backwards, homophobic state in the eyes of our nation. Can't we move on to bigger issues - like educating our kids?

  3. 1. IBJ should link to the referenced report. We are in the age of electronic media...not sharing information is lazy. Here is a link http://www.in.gov/gov/files/Blue_Ribbon_Panel_Report_July_9_2014.pdf 2. The article should provide more clarity about the make-up of this panel. The commenters are making this item out to be partisan, it does not appear the panel is partisan. Here is a list of the panel which appears to be balanced with different SME to add different perspectives http://www.in.gov/activecalendar/EventList.aspx?view=EventDetails&eventidn=138116?formation_id=189603 3. It suggests a by-pass, I do not see where this report suggests another "loop". 4. Henry, based on your kneejerk reaction, we would be better off if you moved to another state unless your post was meant as sarcasm in which case I say Well Done. 5. The article and report actually indicates need to improve rail and port infrastructure in direct contradiction to Shayla commentary. Specifically, recommendation is to consider passenger rail projects... 6. People have a voice with their elected officials. These are suggestions and do not represent "crony capitalism", etc. The report needs to be analyzed and the legislature can decide on priorities and spending. Don't like it, then vote in a new legislature but quit artificially creating issues where there are none! People need to sift through the politics and provide constructive criticism to the process rather than making uninformed comments in a public forum based on misinformation. IBJ should work harder to correct the record in these forums when blatant errors or misrepresentations are made.

  4. Joe ... Marriage is defined in the Bible ... it is mentioned in the Bible often. Marriage is not mentioned once in the US or Indiana Constitution ...

  5. Daniel - Educate me please: what does the Bible have to do with laws? If the government wasn't in the business of marriage to begin with, then it wouldn't have to "define" marriage at all. Marriage could be left as a personal, religious, or otherwise unregulated action, with no ties to taxes, legal status, etc. Then people could marry whomever they want, and all this silliness would go away. Remember to vote Libertarian in November.

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