If e-commerce stalwarts like Amazon.com (NASDAQ:AMZN) and eBay (NASDAQ:EBAY) can't satisfy investors, a company like Shopping.com (NASDAQ:SHOP) wouldn't seem to have a chance.

Internet investors have been too optimistic on projections. As a result, we've seen a quick correction in values. And, yes, one of the latest victims is Shopping.com. The good news, though, is that a recent merger and plans for expansion should help the company down the road.

Yesterday, the company reported its earnings, and everything went according to script. That is, today, it's following in the footsteps of its Net rivals as its stock has sunk by more than 16% to $19.45. Yes, fourth-quarter revenues surged 33%, to $33.6 million, over the same period in 2003. But the company reported a loss of $917,000, or $0.09 per share.

Shopping.com even put its own positive spin on the numbers by focusing on adjusted earnings before interest, taxes, depreciation, and amortization. Shopping.com calls this the "net loss attributable to ordinary shareholders plus deemed dividend, interest expense, provision for income taxes, depreciation, amortization, stock-based compensation, and restructuring and other charges, and less interest and other income, net."


Well, anyway, the number came to $9.2 million in the fourth quarter. But then again, adjusted EBITDA is not a measure of financial performance under generally accepted accounting principles, so it should be discounted. Even so, the net loss for the quarter is mostly the result of a $7.2 million dividend related to its initial public offering, a one-time event.

Shopping.com does have an interesting twist. As part of a merger between DealTime.com and Epinions.com, the site is -- and should continue to be -- a robust comparison-shopping venue. It has been successful in the United States and should translate globally.

But at least in the short term, Shopping.com will suffer depressed earnings, as it plans to spend $8 million to $10 million in 2005 to launch sites in France and Germany. But if it wants to maintain its hefty growth rate, this investment is a necessity and certainly affordable, given the success of the company's recent IPO.

Fool contributor Tom Taulli does not own shares mentioned in this article.