Lower Ad-Serving Sales Hurt DoubleClick

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DoubleClick reported lower second-quarter earnings yesterday, saying its ad-serving business declined.

The New York-based company, which provides a variety of ad technologies, including e-mail services, said soft demand from publishers for its ad-management services and lower catalog mailings in its Abacus business combined to cause its earning decline compared to the previous year's second quarter.

Overall, DoubleClick's sales were $69.2 million, up 8 percent from the year-ago period. Net income was $3.9 million, down 33 percent. The company lowered its forecast for the year. It now expects sales of $290 million to $315 million.

DoubleClick CEO Kevin Ryan called the quarter "disappointing" in a conference call with investors.

Ad management, which accounts for nearly half of DoubleClick's business, was a particular disappointment. The company said ad-server sales for the quarter were $31.8 million, down from $32.6 million a year earlier. The decline came as a result of lower sales to publishers, which make up about half of its ad-serving revenues, as DoubleClick experience increases in advertiser and rich media ad serving.

In a bright sign, DoubleClick said its e-mail business is doing well. It had positive income in the quarter and revenue increased 12 percent.


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