Shares of online coupon company RetailMeNot soared on Tuesday after the company beat Wall Street expectations in the fourth quarter.
RetailMeNot reported fourth-quarter net income of $2.4 million. On a per-share basis, the company posted a profit of 5 cents. Earnings adjusted for one-time expenses came to 37 cents per share.
That exceeded Wall Street forecasts. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 31 cents per share.
Revenue for the quarter increased 17 percent from a year ago to $96.9 million. That also surpassed Street expectations: Five analysts surveyed by Zacks expected $94.9 million.
In morning trading, shares of RetailMeNot rose 17 percent, or $1.55, to $10.50 per share.
“During 2016 we continued to make strides toward our long-term goal of becoming a leading savings destination for consumers,” CEO Cotter Cunningham said in a statement. “While the year had its challenges, we closed out the fourth quarter on a positive note and believe we are well positioned to capitalize on our initiatives in 2017 and beyond.”
Founded in 2009, RetailMeNot operates the largest online marketplace for coupons and consumer deals. Its sites and mobile apps provide coupon codes, free trials and other retail offers from more than 70,000 merchants including Macy’s, Nordstrom, Wal-Mart and Target.
In recent years, RetailMeNot has invested in a strategy to move beyond its traditional niche -- desktop computer transactions -- to focus on its fast-growing mobile business.
In the fourth quarter, mobile online transaction net revenue was up 8 percent, while desktop online transaction net revenue declined 20 percent.
The company has also moved into new markets, including secondary gift cards. In April, RetailMeNot paid $22 million to acquire GiftCard Zen, a Phoenix-based startup that buys and sells gift cards online
GiftCard Zen, based in Phoenix, operates a website that buys gift cards from users who don't want them -- for less than the face value of the card -- and then resells them at a discount to users who do want the cards. The average discount on a gift card for sale on the site is between 12 percent and 15 percent off face value.
For the fiscal year 2016, RetailMeNot reported a profit of $2 million, or 4 cents per share. Revenue grew 13 percent year-over-year to $280.4 million.
For the current quarter ended in April, the company said it expects revenue in the range of $49 million to $53 million.
The company expects full-year revenue in the range of $223.5 million to $238.5 million.
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