The 10-second takeaway
For the quarter ended June 30 (Q2), IAC/InterActiveCorp beat expectations on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly. Non-GAAP earnings per share expanded. GAAP earnings per share grew significantly.
Gross margins expanded, operating margins dropped, net margins grew.
IAC/InterActiveCorp booked revenue of $799.4 million. The 15 analysts polled by S&P Capital IQ expected revenue of $782.4 million on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $680.6 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.95. The 16 earnings estimates compiled by S&P Capital IQ averaged $0.94 per share. Non-GAAP EPS of $0.95 for Q2 were 10% higher than the prior-year quarter's $0.86 per share. (The prior-year quarter included -$0.05 per share in earnings from discontinued operations.) GAAP EPS of $0.69 for Q2 were 47% higher than the prior-year quarter's $0.47 per share. (The prior-year quarter included -$0.05 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 65.9%, 70 basis points better than the prior-year quarter. Operating margin was 13.3%, 100 basis points worse than the prior-year quarter. Net margin was 7.3%, 90 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $819.4 million. On the bottom line, the average EPS estimate is $1.02.
Next year's average estimate for revenue is $3.21 billion. The average EPS estimate is $3.97.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 369 members out of 407 rating the stock outperform, and 38 members rating it underperform. Among 138 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 127 give IAC/InterActiveCorp a green thumbs-up, and 11 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on IAC/InterActiveCorp is outperform, with an average price target of $56.00.
Internet software and services are being consumed in radically different ways, on new and increasingly mobile devices. Is IAC/InterActiveCorp on the right side of the revolution? Check out the changing landscape and meet the company that Motley Fool analysts expect to lead "The Next Trillion-dollar Revolution." Click here for instant access to this free report.
- Add IAC/InterActiveCorp to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.