IAC/InterActiveCorp said Wednesday that it swung to a second-quarter loss, hurt by a $300 million writedown in a catalog business, but excluding that and other charges its earnings beat analysts’ estimates.
Barry Diller’s Internet conglomerate reported a loss of $421.6 million, or $1.51 per share. In the year-ago quarter IAC had a profit of $94.6 million, or 31 cents per share, according to restated results.
On an adjusted basis, New York-based IAC, which is splitting into five publicly traded companies, reported earnings of 35 cents per share — better than the 31 cents expected by analysts polled by Thomson Financial.
Revenue rose 7 percent to $1.6 billion, meeting analysts’ estimates. The increase was helped by growth in Internet properties under IAC, which will be the name the company’s core business will retain after it spins off the four other properties: Tree.com Inc., the HSN Inc. home shopping network, the Ticketmaster ticketing service and the Interval Leisure Group Inc. time-share business. HSN, Ticketmaster and Interval all reported sales growth this quarter.
IAC’s overall growth was overshadowed by charges, however. IAC had said in June that it expected to report a goodwill impairment of about $300 million for Cornerstone Brands — which is part of HSN — in the second quarter. The company had cited deterioration in the retail environment, especially in the home and apparel categories.
Results were also hurt by $166 million in impairment charges for Tree.com, which will be the new name for the company’s lending and real estate business after the spinoff and will include the LendingTree brand.
Tree.com revenue fell 47 percent to $60 million, which IAC attributed to a decline in loans and problems in the real estate market.
IAC has indicated it expects to have the spinoffs completed in August. During a conference call with analysts Wednesday, Diller said the company is "almost there on the spins."
IAC shares fell 7 cents to $17.88 in midday trading.