LookSmart will lose more money than anticipated in the fourth quarter thanks to sluggish advertiser demand, the San Francisco paid search company said last week.
It likely will lose $1.4 million to $1.7 million, the company said, up from the less than $1 million forecast. LookSmart projects much lower sales in the quarter, between $16.5 million and $17 million. It originally expected revenue of $18 million to $20 million.
The lowered expectations for the quarter come amid reports that advertisers poured money into search marketing during the holiday season. Goldman Sachs this month raised its earnings estimates for Google and Yahoo, citing strong growth of paid search and Internet advertising over the holiday shopping season.
Piper Jaffray on Friday upgraded Ask Jeeves based on its research that the search engine saw an 18 percent rise in traffic during the fourth quarter.
LookSmart has struggled to remake itself as an alternative paid listings provider following its loss in October 2003 of a key paid inclusion listings deal with Microsoft, which accounted for two-thirds of its sales.
LookSmart also announced a restructuring of operations to help turn around its business. The company is now divided into two divisions, paid listings/syndication and consumer products. Bryan Everett, a former sales executive with 24/7 Real Media, joins the company to lead the paid listings/syndication division. Deborah Richman, a former Overstock.com executive, joined to head the consumer products division.
The management change comes three months after LookSmart named former 24/7 Real Media executive Dave Hills chief executive. LookSmart has had three CEOs in the past year.
Brian Morrissey covers online marketing and advertising, including e-mail marketing and paid search, for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters
