Martha Stewart Living ( MSO) got taken to the woodshed Thursday after the company posted weak numbers and reminded Wall Street that it's spending millions on a show from which it receives no revenue.

The New York-based media company lost $26 million, or 51 cents a share, for the quarter ended Sept. 30, compared with a year-ago loss of $15 million, or 30 cents a share. Latest-quarter numbers included a charge of $11 million, or 21 cents a share, related to the vesting of certain warrants granted in connection with the airing of The Apprentice: Martha Stewart.

Excluding the charge, the third-quarter loss was in line with the Thomson First Call analyst estimate. But the setup didn't pass muster with investors, who sent the stock down 15% and within a dollar and change of its 52-week low.

"When you get through all the hype, there's no earnings," says Dennis McAlpine of McAlpine Associates, which doesn't own the stock. "The magazine is doing tremendously well, but they have two failed TV shows and an Internet operation that's minuscule."

Not everyone was so bearish. "I think this is a case where they're trying to get all the bad news out at once," said one media analyst who doesn't cover the company or own shares. "With merchandising and their TV business a bit of a disappointment and softness in some of their segments, this is a way to clear the deck and hope for an upside surprise next quarter."

All the same, the warrant deal stuck out like a sore thumb. It struck some on Wall Street as questionable because it rewards Apprentice producer Marc Burnett and Martha Stewart, the namesake lifestyle diva, for their work in a show in which MSO shareholders "have no economic interest," as the company so delicately put it Thursday.

Asked on the conference call about Burnett, CEO Susan Lyne stood firmly behind the reality show producer. Indeed, in its earnings press release Thursday morning, the company spoke of the "promotional value" of the NBC show, whose ratings haven't met expectations. The company claims The Apprentice deal is "cash neutral" for it, though maybe a little less so now that the numbers are in.

"At current ratings we will have some make-goods," said CEO Susan Lyne on the midday conference call. The company had guided to between $40 million to $50 million in TV-related revenue for the year, excluding DVD sales. Lyne now says that it is looking at "between $40 million to $45 million," she called "essentially break-even."

Lyne said that the company has met its strategic goals for the year. She said those included getting advertisers back on board, putting Martha back on TV, strengthening management, using the company's library and making content widely available. Still, despite increased ad pages at the magazine and the TV exposure, the diva's mass media splash has been costly for shareholders.

McAlpine feels that whatever "hype machine" surrounds Martha has "milked a lot out of the name," but that people didn't stop to see what the company is actually getting in return. McAlpine adds that while Lyne is doing a remarkable job, he believes the stock is heading for $10.