Steven Towns submits: Excerpt from our Wall Street Breakfast, a one-page summary of this morning's key market-moving and stock-moving stories:
China's Tom Online 3Q Profit Sinks [Business Week/AP]
Summary: TOMO's Q3 net income down 59% y-o-y to $5.3m, on 15.2% lower sales to $39m, due to policy changes by the government and China's mobile carriers requiring longer free trials for new services, new billing methods, and other restrictions. Wireless Internet services made up 89% of TOMO's revenues. CEO Wang Leilei comments, "I am confident Tom Online will be able to successfully navigate through this difficult period together with our partners." Forecasts continued weakness in Q4 -- expects revenue to fall to $34.5m-$35.5m. TOMO-1yrchart-110906 TOMO reports its venture with Skype had 23.5m registered users as of the end of Oct.; hopes to begin collecting revenue in early '07. Related links: Earnings conference call transcripts: TOM Online Q3 2006. Press release: TOMO Q3 earnings. Additional coverage: WSJ and newratings.com: Morgan Stanley rates TOMO "overweight". Commentary: Chinese Internet Stocks Earnings and "Barbelling" • eBay Update: China, Skype, Paypal and New Holiday Features • eBay Losing in Asian Online Auctions, Tom Group Could Buy eBay China • IRG's Chinese Tech Stock Weekly. Potentially impacted stocks and ETFs: TOM Online (TOMO) • Partners: China Mobile (CHL) and China Unicom (CHU) • Competitors: NetEase.com (NTES), SINA Corp (SINA) and Sohu.com (SOHU).
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