MarketWatch.com Reports First Quarter 2001 Financial Results

Company Posts Significant Bottom Line Improvement



Apr 25, 2001, 01:00 ET from MarketWatch.com, Inc.

    SAN FRANCISCO, April 25 /PRNewswire/ --
 MarketWatch.com, Inc. (Nasdaq:   MKTW), the Internet's leading source of
 financial news and information, today reported net revenues of $11.8 million
 for the quarter ended March 31, 2001, a 5% decline over the same period of
 2000.
     The Company's domestic pro forma net loss for the first quarter of 2001,
 excluding amortization of goodwill and intangibles and its share in the
 results of its European joint venture, was $5.8 million, or $0.35 per share,
 comparing favorably to $9.4 million, or $0.67 per share, for the same period
 of 2000.  First quarter 2001 net loss was $19.9 million, or $1.20 per share,
 compared to $22.7 million, or $1.62 per share, for the same period of 2000.
     "This quarter has truly emphasized the significance of our content
 licensing business line and the importance of a diversified revenue stream, as
 demand for online advertising softened from the overall economic slowdown,"
 said Larry Kramer, MarketWatch.com Chairman and Chief Executive Officer.  "Our
 licensing business exceeded our expectations and grew more than 100% over last
 year.  With site traffic continuing to grow, and numerous other positive
 developments, we believe MarketWatch.com is well positioned as a category
 leader."
     "Over the past several months we continued our tight cost controls in
 light of the advertising downturn," added Kramer.  "This enabled us to exceed
 our bottom line targets and continue our path to generating positive cash flow
 from operations."
 
     Advertising and licensing services
     Advertising revenues were $5.2 million for Q1 2001 compared to
 $8.7 million for the same period last year.  Licensing revenues rose 103% to
 $5.9 million for the first quarter 2001, compared to $2.9 million in Q1 2000.
 The diversity of the Company's revenue stream continued to be emphasized this
 quarter as licensing revenues and other revenues (primarily broadcast and
 radio) represented 56% of total net revenues.
     "As the premier online source of financial news and information, we
 continued to broaden our advertising client base this quarter by signing up
 more traditional advertisers such as Anheuser-Busch, Kmart/BlueLight.com, and
 Infiniti.  They joined a stable of ongoing campaigns with existing clients who
 are traditional advertisers, including United Airlines and Lexus," said
 Kramer. "We provide advertisers a unique opportunity for reaching our highly
 desirable demographic during the work day."
     Licensing revenues more than doubled this quarter over a year ago as
 several new customers joined existing clients as subscribers to the Company's
 world-class content and tools.  MarketWatch.com's licensing business
 maintained its top-tier customer base, adding CIBC, Prudential Securities,
 Bank of New York, Dow Jones Newswire and several others during Q1 2001.  The
 Company serves licensing clients in more than 17 countries worldwide.
 
     Traffic
     The Company continued to improve its traffic metrics across its licensing
 business and all of its online properties -- cbs.marketwatch.com,
 ftmarketwatch.com and bigcharts.com.  Some highlights included:
 
     -- According to March 2001 data from Media Metrix and Nielsen//NetRatings,
 MarketWatch.com led the competition as the Number One financial news and
 information source on the Internet.
     -- During Q1 2001, MarketWatch.com served a total of 1.3 billion pages and
 licensing content impressions on its destination sites and syndicated
 licensing clients' sites.  Page views from the Company's web sites for the
 first quarter of 2001 were 676 million, excluding pages from "spiders"
 (external third parties accessing MarketWatch.com pages in order to capture
 headlines and other content).  First quarter page views from the Company's web
 sites, with spiders, were 890 million, compared to 831 million page views for
 fourth quarter of 2000 and 771 million page views in Q1 2000.
     -- The 14-week CBS MarketWatch Survivor Investment contest, which launched
 February 5, 2001, contributed 9.2 million page views through March 31, 2001.
 The contest includes two components  -- an offline contest among 14 investment
 clubs (promoted in connection with CBS' The Early Show, reaching 2.5 million
 households on average), and an online individual contest with more than
 55,000 players registered as of March 31, 2001.
     -- Average monthly unique users were 8.51 million for first quarter 2001,
 compared to 8.37 million for the fourth quarter 2000, as measured by
 DoubleClick.
 
     "We're increasing our lead against our next closest competitors," said
 Kramer.  "We have maintained our position as the market leader in original
 financial content, and attribute part of our success this quarter to the
 launch of a new version of our consumer destination site, CBS
 MarketWatch.com."
 
     Operating Results
     Operating expenses, excluding the amortization of goodwill and
 intangibles, decreased 23% to $13.7 million for the first quarter 2001,
 compared to $17.8 million in the first quarter of 2000.  Operating expenses,
 excluding the amortization of goodwill and intangibles, as a percentage of net
 revenues, decreased to 116%, compared to 143% in the first quarter of 2000.
 The Company continued to focus on cost containment and management, with
 headcount totaling 255 at March 31, 2001, compared to 266 at
 December 31, 2000.
     Cash at the end of Q1 2001 totaled $40.1 million, with cash used in
 operations during the quarter averaging $800,000 per month.  Accounts
 receivable at March 31, 2001 decreased to $9.6 million compared to
 $11.8 million last quarter.
     "We continue to conservatively manage our cash and our operating
 expenses," added Kramer. "We believe our current cash reserves will be more
 than sufficient until we are generating positive cash flow, which we
 anticipate by the end of this year."
 
     Other Business Highlights
     FT MarketWatch.com, the web site joint venture between MarketWatch.com,
 Inc. and Financial Times Group Limited, served 457,000 unique users and
 7.5 million page views in March 2001, as compared to 300,000 unique users and
 5.1 million page views in December 2000.
      Content from the Company's properties is distributed in major newspapers,
 including The Financial Times, The Daily News Express, the daily evening
 commuter edition of the New York Daily News, and the San Francisco Examiner.
 Financial content is also widely distributed across major wireless networks,
 including AT&T Wireless, Palm Inc., OmniSky, AvantGo, Nextel, Verizon and
 Sprint PCS.  During March 2001, MarketWatch.com recorded 11.7 million views
 across wireless devices as one of the leading financial information providers
 for this growing sector.
     The CBS MarketWatch Weekend show continued to gain ratings, and at
 March 31, 2001, was broadcast on 156 stations, reaching approximately 87% of
 the U.S.  The MarketWatch.com radio network has grown to 162 stations covering
 83% of the U.S.  The radio network is carried in all of the top 10 markets,
 24 of the top 25 and 44 of the top 50, reaching 14.4 million unduplicated
 listeners per week.
 
     About MarketWatch.com, Inc.
     MarketWatch.com, Inc., a leading financial media company, is the number
 one financial news and information source on the Internet.  Founded in 1997,
 MarketWatch.com operates three web sites:  cbs.marketwatch.com, bigcharts.com,
 and U.K.-based ftmarketwatch.com.  In addition to offering top-notch financial
 reporting and investment tools on its web sites, MarketWatch.com licenses a
 wide array of content and tools in custom-designed formats for brokerages and
 other online businesses.  The Company also produces the syndicated CBS
 MarketWatch Weekend program, airs financial reports over CBS Network
 Television, and provides updates every 30 minutes on the MarketWatch.com Radio
 Network.  Editorial content from cbs.marketwatch.com is distributed in major
 newspapers and wireless networks.
 
     Notice Regarding Forward-Looking Statements
     This media release contains forward-looking statements that involve risks
 and uncertainties. MarketWatch.com's actual results may differ materially from
 those anticipated in these forward-looking statements, which include
 statements as to the Company's future positive cash flow, level of web site
 traffic and sufficiency of cash reserves.  Factors that might contribute to
 such differences include, among others, the Company's ability to attract and
 retain advertisers from industries other than the Internet related industries
 and the financial industries; levels of renewals from licensing customers and
 the Company's ability to attract new licensing customers; the level of
 internet advertising; competition, which could lead to pricing pressure; the
 Company's ability to generate significant revenues from sources other than
 Internet advertising; general economic conditions; unforeseen changes in
 expense levels; and the Company's ability to develop on a timely basis, as
 well as consumer acceptance of, the Company's new services or tools.  More
 information about these and other potential factors, which could affect the
 Company's business and financial results, is contained in the Company's Annual
 Report on Form 10-K for the year ended December 31, 2000, as well as the other
 reports it files with the Securities Exchange Commission.  These
 forward-looking statements are based on information available to the Company
 on the date hereof.  MarketWatch.com, Inc. assumes no obligation to publicize
 the results of any potential revision of these forward-looking statements.
 
                             MarketWatch.com, Inc.
                  Unaudited Condensed Statements of Operations
                                 (in thousands)
                                                         Three Months Ended
                                                             March 31,
                                                        2001           2000
     Net revenues:
      Advertising                                      $5,179         $8,727
 
      Licensing                                         5,865          2,895
 
      Other                                               769            779
 
       Total net revenues                              11,813         12,401
 
 
     Cost of net revenues                               4,810          4,439
 
 
     Gross profit                                       7,003          7,962
 
 
     Operating expenses:
      Product development                               2,485          2,300
 
      General and administrative                        3,645          3,116
 
      Sales and marketing                               6,221          7,921
 
      CBS in-kind advertising                           1,317          4,426
 
      Amortization of goodwill                         12,801         12,850
 
       Total operating expenses                        26,469         30,613
 
 
     Loss from operations                            (19,466)       (22,651)
 
 
     Interest income                                      602            168
 
     Loss in joint venture                            (1,055)          (223)
 
 
     Net loss                                       $(19,919)      $(22,706)
 
 
     Basic and diluted net loss per share             $(1.20)        $(1.62)
 
 
     Weighted average shares used to compute
      basic and diluted net loss per share             16,573         14,024
 
                             MarketWatch.com, Inc.
         Unaudited Domestic Proforma Condensed Statements of Operations
                                 (in thousands)
                                                         Three Months Ended
                                                              March 31,
                                                         2001          2000
     Net revenues:
      Advertising                                      $5,179         $8,727
 
      Licensing                                         5,865          2,895
 
      Other                                               769            779
 
       Total net revenues                              11,813         12,401
 
 
     Cost of net revenues                               4,560          4,189
 
 
     Gross profit                                       7,253          8,212
 
 
     Operating expenses:
      Product development                               2,485          2,300
 
      General and administrative                        3,645          3,116
 
      Sales and marketing                               6,221          7,921
 
      CBS in-kind advertising                           1,317          4,426
 
       Total operating expenses                        13,668         17,763
 
 
     Loss from operations                             (6,415)        (9,551)
 
 
     Interest income                                      602            168
 
 
     Net loss                                        $(5,813)       $(9,383)
 
 
     Basic and diluted net loss per share             $(0.35)        $(0.67)
 
 
     Weighted average shares used to compute
      basic and diluted net loss per share             16,573         14,024
 
     Note:  The above unaudited domestic pro forma condensed statements of
 operations exclude the effects of the following:
 
     -- Amortization of purchased technology, goodwill and intangibles
     -- Loss in joint venture
 
                             MarketWatch.com, Inc.
                            Condensed Balance Sheets
                                 (in thousands)
 
 
                                                     March 31,    December 31,
                                                        2001           2000
                                                    (unaudited)
        Assets
 
     Current assets:
      Cash and cash equivalents                       $40,070        $45,356
 
      Accounts receivable, net                          9,604         11,838
 
      Prepaid expenses                                  2,496          2,497
 
       Total current assets                            52,170         59,691
 
 
     Property and equipment, net                       11,493         10,846
 
     Intangible assets, net                               786          1,129
 
     Goodwill, net                                     59,302         72,010
 
     Investment in joint venture                          421             --
 
     Other assets                                         569            564
 
 
       Total assets                                  $124,741       $144,240
 
 
        Liabilities and Stockholders' Equity
     Current liabilities:
      Accounts payable and accrued expenses            $9,266        $10,635
 
      Deferred revenue                                    381            188
 
       Total current liabilities                        9,647         10,823
 
 
     Stockholders' equity:
      Preferred stock                                      --             --
 
      Common stock                                        167            166
 
      Additional paid-in capital                      319,703        319,425
 
      Contribution receivable                        (20,222)       (21,539)
 
      Accumulated deficit                           (184,554)      (164,635)
 
       Total stockholders' equity                     115,094        133,417
 
 
       Total liabilities and stockholders' equity    $124,741       $144,240
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X48773671
 
 

SOURCE MarketWatch.com, Inc.
    SAN FRANCISCO, April 25 /PRNewswire/ --
 MarketWatch.com, Inc. (Nasdaq:   MKTW), the Internet's leading source of
 financial news and information, today reported net revenues of $11.8 million
 for the quarter ended March 31, 2001, a 5% decline over the same period of
 2000.
     The Company's domestic pro forma net loss for the first quarter of 2001,
 excluding amortization of goodwill and intangibles and its share in the
 results of its European joint venture, was $5.8 million, or $0.35 per share,
 comparing favorably to $9.4 million, or $0.67 per share, for the same period
 of 2000.  First quarter 2001 net loss was $19.9 million, or $1.20 per share,
 compared to $22.7 million, or $1.62 per share, for the same period of 2000.
     "This quarter has truly emphasized the significance of our content
 licensing business line and the importance of a diversified revenue stream, as
 demand for online advertising softened from the overall economic slowdown,"
 said Larry Kramer, MarketWatch.com Chairman and Chief Executive Officer.  "Our
 licensing business exceeded our expectations and grew more than 100% over last
 year.  With site traffic continuing to grow, and numerous other positive
 developments, we believe MarketWatch.com is well positioned as a category
 leader."
     "Over the past several months we continued our tight cost controls in
 light of the advertising downturn," added Kramer.  "This enabled us to exceed
 our bottom line targets and continue our path to generating positive cash flow
 from operations."
 
     Advertising and licensing services
     Advertising revenues were $5.2 million for Q1 2001 compared to
 $8.7 million for the same period last year.  Licensing revenues rose 103% to
 $5.9 million for the first quarter 2001, compared to $2.9 million in Q1 2000.
 The diversity of the Company's revenue stream continued to be emphasized this
 quarter as licensing revenues and other revenues (primarily broadcast and
 radio) represented 56% of total net revenues.
     "As the premier online source of financial news and information, we
 continued to broaden our advertising client base this quarter by signing up
 more traditional advertisers such as Anheuser-Busch, Kmart/BlueLight.com, and
 Infiniti.  They joined a stable of ongoing campaigns with existing clients who
 are traditional advertisers, including United Airlines and Lexus," said
 Kramer. "We provide advertisers a unique opportunity for reaching our highly
 desirable demographic during the work day."
     Licensing revenues more than doubled this quarter over a year ago as
 several new customers joined existing clients as subscribers to the Company's
 world-class content and tools.  MarketWatch.com's licensing business
 maintained its top-tier customer base, adding CIBC, Prudential Securities,
 Bank of New York, Dow Jones Newswire and several others during Q1 2001.  The
 Company serves licensing clients in more than 17 countries worldwide.
 
     Traffic
     The Company continued to improve its traffic metrics across its licensing
 business and all of its online properties -- cbs.marketwatch.com,
 ftmarketwatch.com and bigcharts.com.  Some highlights included:
 
     -- According to March 2001 data from Media Metrix and Nielsen//NetRatings,
 MarketWatch.com led the competition as the Number One financial news and
 information source on the Internet.
     -- During Q1 2001, MarketWatch.com served a total of 1.3 billion pages and
 licensing content impressions on its destination sites and syndicated
 licensing clients' sites.  Page views from the Company's web sites for the
 first quarter of 2001 were 676 million, excluding pages from "spiders"
 (external third parties accessing MarketWatch.com pages in order to capture
 headlines and other content).  First quarter page views from the Company's web
 sites, with spiders, were 890 million, compared to 831 million page views for
 fourth quarter of 2000 and 771 million page views in Q1 2000.
     -- The 14-week CBS MarketWatch Survivor Investment contest, which launched
 February 5, 2001, contributed 9.2 million page views through March 31, 2001.
 The contest includes two components  -- an offline contest among 14 investment
 clubs (promoted in connection with CBS' The Early Show, reaching 2.5 million
 households on average), and an online individual contest with more than
 55,000 players registered as of March 31, 2001.
     -- Average monthly unique users were 8.51 million for first quarter 2001,
 compared to 8.37 million for the fourth quarter 2000, as measured by
 DoubleClick.
 
     "We're increasing our lead against our next closest competitors," said
 Kramer.  "We have maintained our position as the market leader in original
 financial content, and attribute part of our success this quarter to the
 launch of a new version of our consumer destination site, CBS
 MarketWatch.com."
 
     Operating Results
     Operating expenses, excluding the amortization of goodwill and
 intangibles, decreased 23% to $13.7 million for the first quarter 2001,
 compared to $17.8 million in the first quarter of 2000.  Operating expenses,
 excluding the amortization of goodwill and intangibles, as a percentage of net
 revenues, decreased to 116%, compared to 143% in the first quarter of 2000.
 The Company continued to focus on cost containment and management, with
 headcount totaling 255 at March 31, 2001, compared to 266 at
 December 31, 2000.
     Cash at the end of Q1 2001 totaled $40.1 million, with cash used in
 operations during the quarter averaging $800,000 per month.  Accounts
 receivable at March 31, 2001 decreased to $9.6 million compared to
 $11.8 million last quarter.
     "We continue to conservatively manage our cash and our operating
 expenses," added Kramer. "We believe our current cash reserves will be more
 than sufficient until we are generating positive cash flow, which we
 anticipate by the end of this year."
 
     Other Business Highlights
     FT MarketWatch.com, the web site joint venture between MarketWatch.com,
 Inc. and Financial Times Group Limited, served 457,000 unique users and
 7.5 million page views in March 2001, as compared to 300,000 unique users and
 5.1 million page views in December 2000.
      Content from the Company's properties is distributed in major newspapers,
 including The Financial Times, The Daily News Express, the daily evening
 commuter edition of the New York Daily News, and the San Francisco Examiner.
 Financial content is also widely distributed across major wireless networks,
 including AT&T Wireless, Palm Inc., OmniSky, AvantGo, Nextel, Verizon and
 Sprint PCS.  During March 2001, MarketWatch.com recorded 11.7 million views
 across wireless devices as one of the leading financial information providers
 for this growing sector.
     The CBS MarketWatch Weekend show continued to gain ratings, and at
 March 31, 2001, was broadcast on 156 stations, reaching approximately 87% of
 the U.S.  The MarketWatch.com radio network has grown to 162 stations covering
 83% of the U.S.  The radio network is carried in all of the top 10 markets,
 24 of the top 25 and 44 of the top 50, reaching 14.4 million unduplicated
 listeners per week.
 
     About MarketWatch.com, Inc.
     MarketWatch.com, Inc., a leading financial media company, is the number
 one financial news and information source on the Internet.  Founded in 1997,
 MarketWatch.com operates three web sites:  cbs.marketwatch.com, bigcharts.com,
 and U.K.-based ftmarketwatch.com.  In addition to offering top-notch financial
 reporting and investment tools on its web sites, MarketWatch.com licenses a
 wide array of content and tools in custom-designed formats for brokerages and
 other online businesses.  The Company also produces the syndicated CBS
 MarketWatch Weekend program, airs financial reports over CBS Network
 Television, and provides updates every 30 minutes on the MarketWatch.com Radio
 Network.  Editorial content from cbs.marketwatch.com is distributed in major
 newspapers and wireless networks.
 
     Notice Regarding Forward-Looking Statements
     This media release contains forward-looking statements that involve risks
 and uncertainties. MarketWatch.com's actual results may differ materially from
 those anticipated in these forward-looking statements, which include
 statements as to the Company's future positive cash flow, level of web site
 traffic and sufficiency of cash reserves.  Factors that might contribute to
 such differences include, among others, the Company's ability to attract and
 retain advertisers from industries other than the Internet related industries
 and the financial industries; levels of renewals from licensing customers and
 the Company's ability to attract new licensing customers; the level of
 internet advertising; competition, which could lead to pricing pressure; the
 Company's ability to generate significant revenues from sources other than
 Internet advertising; general economic conditions; unforeseen changes in
 expense levels; and the Company's ability to develop on a timely basis, as
 well as consumer acceptance of, the Company's new services or tools.  More
 information about these and other potential factors, which could affect the
 Company's business and financial results, is contained in the Company's Annual
 Report on Form 10-K for the year ended December 31, 2000, as well as the other
 reports it files with the Securities Exchange Commission.  These
 forward-looking statements are based on information available to the Company
 on the date hereof.  MarketWatch.com, Inc. assumes no obligation to publicize
 the results of any potential revision of these forward-looking statements.
 
                             MarketWatch.com, Inc.
                  Unaudited Condensed Statements of Operations
                                 (in thousands)
                                                         Three Months Ended
                                                             March 31,
                                                        2001           2000
     Net revenues:
      Advertising                                      $5,179         $8,727
 
      Licensing                                         5,865          2,895
 
      Other                                               769            779
 
       Total net revenues                              11,813         12,401
 
 
     Cost of net revenues                               4,810          4,439
 
 
     Gross profit                                       7,003          7,962
 
 
     Operating expenses:
      Product development                               2,485          2,300
 
      General and administrative                        3,645          3,116
 
      Sales and marketing                               6,221          7,921
 
      CBS in-kind advertising                           1,317          4,426
 
      Amortization of goodwill                         12,801         12,850
 
       Total operating expenses                        26,469         30,613
 
 
     Loss from operations                            (19,466)       (22,651)
 
 
     Interest income                                      602            168
 
     Loss in joint venture                            (1,055)          (223)
 
 
     Net loss                                       $(19,919)      $(22,706)
 
 
     Basic and diluted net loss per share             $(1.20)        $(1.62)
 
 
     Weighted average shares used to compute
      basic and diluted net loss per share             16,573         14,024
 
                             MarketWatch.com, Inc.
         Unaudited Domestic Proforma Condensed Statements of Operations
                                 (in thousands)
                                                         Three Months Ended
                                                              March 31,
                                                         2001          2000
     Net revenues:
      Advertising                                      $5,179         $8,727
 
      Licensing                                         5,865          2,895
 
      Other                                               769            779
 
       Total net revenues                              11,813         12,401
 
 
     Cost of net revenues                               4,560          4,189
 
 
     Gross profit                                       7,253          8,212
 
 
     Operating expenses:
      Product development                               2,485          2,300
 
      General and administrative                        3,645          3,116
 
      Sales and marketing                               6,221          7,921
 
      CBS in-kind advertising                           1,317          4,426
 
       Total operating expenses                        13,668         17,763
 
 
     Loss from operations                             (6,415)        (9,551)
 
 
     Interest income                                      602            168
 
 
     Net loss                                        $(5,813)       $(9,383)
 
 
     Basic and diluted net loss per share             $(0.35)        $(0.67)
 
 
     Weighted average shares used to compute
      basic and diluted net loss per share             16,573         14,024
 
     Note:  The above unaudited domestic pro forma condensed statements of
 operations exclude the effects of the following:
 
     -- Amortization of purchased technology, goodwill and intangibles
     -- Loss in joint venture
 
                             MarketWatch.com, Inc.
                            Condensed Balance Sheets
                                 (in thousands)
 
 
                                                     March 31,    December 31,
                                                        2001           2000
                                                    (unaudited)
        Assets
 
     Current assets:
      Cash and cash equivalents                       $40,070        $45,356
 
      Accounts receivable, net                          9,604         11,838
 
      Prepaid expenses                                  2,496          2,497
 
       Total current assets                            52,170         59,691
 
 
     Property and equipment, net                       11,493         10,846
 
     Intangible assets, net                               786          1,129
 
     Goodwill, net                                     59,302         72,010
 
     Investment in joint venture                          421             --
 
     Other assets                                         569            564
 
 
       Total assets                                  $124,741       $144,240
 
 
        Liabilities and Stockholders' Equity
     Current liabilities:
      Accounts payable and accrued expenses            $9,266        $10,635
 
      Deferred revenue                                    381            188
 
       Total current liabilities                        9,647         10,823
 
 
     Stockholders' equity:
      Preferred stock                                      --             --
 
      Common stock                                        167            166
 
      Additional paid-in capital                      319,703        319,425
 
      Contribution receivable                        (20,222)       (21,539)
 
      Accumulated deficit                           (184,554)      (164,635)
 
       Total stockholders' equity                     115,094        133,417
 
 
       Total liabilities and stockholders' equity    $124,741       $144,240
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X48773671
 
 SOURCE  MarketWatch.com, Inc.

RELATED LINKS

http://www.dbc.com