At DoubleClick, Playing Canary in the Internet Coal Mine - TheStreet

At DoubleClick, Playing Canary in the Internet Coal Mine

Unseating Yahoo! as the first Net company to report earnings could bring a new level of scrutiny to the ad firm.
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Few people recall that

Ken Keltner ended

Joe DiMaggio's

56-game hitting streak. So will investors notice when

DoubleClick

(DCLK)

breaks

Yahoo!'s

(YHOO)

first-to-report-earnings streak?

Since time immemorial -- roughly July 1996 -- Yahoo! has been the first widely followed Internet company to report financial results each quarter. Over those 20 quarters, the company's numbers have become Wall Street's primary gauge of the health of the Internet economy. But this time around, when Yahoo! issues second-quarter results, scheduled for Wednesday, July 11, it will be a day behind Internet advertising firm DoubleClick.

The shift reflects DoubleClick's efforts to make its mark on Wall Street amid investor flight from Internet stocks and backsliding financial results. Moreover, DoubleClick may hope to steal some of Yahoo!'s thunder as an Internet bellwether by becoming the leading indicator of the Internet media market.

Good Show

For its part, the company says it wants to report sooner simply because that's what good companies do. "It's been a long-standing goal of mine to move up our reporting date," says DoubleClick Chief Financial Officer Stephen Collins. "We believe that by having the discipline to report quickly, it forces us to put in the kind of system and operating processes that give operating information to managers faster, which makes for better decision making."

For the past three quarters, DoubleClick has reported results a day or two after Yahoo!, which issued its quarterly press releases 10-11 days following the quarter's close. Yahoo! has reported as early as six days after a quarter's close, while DoubleClick required as much as four weeks to close a quarter in 1999.

The public relations value of early reporting, which also depends on the work of DoubleClick Chief Accounting Officer Tom Etergino, is multifaceted, says Collins. "It provides timely information to investors in what is admittedly a volatile market," he says. "It's a demonstration that the company DoubleClick has good processing and controls. We're well run."

Collins adds that his goal is to be compared not just with Yahoo!, but with other well-respected companies, such as legendarily speedy reporter

Cisco

(CSCO) - Get Report

. "We want to be perceived as a world-class company, not only within our industry, but period," says Collins. "Our goal is not to be a great Internet company; it's to be a great company."

Elevating

Collins says DoubleClick has never contemplated issuing financial results the same day as Yahoo!. "Out of respect to investors and analysts, you don't want to schedule your conference call at the same time," he says. "They'd be highly annoyed."

Yahoo! didn't respond to a request for comment about the relative timing of its quarterly announcement.

Of course, what would really elevate both DoubleClick and Yahoo! in investors' eyes is if they had better news to report this quarter. DoubleClick has forecast an operating loss, minus certain charges, of 5 cents to 7 cents a share, on revenue of $100 million to $105 million; in the quarter ended June 30, 2000, the company reported a 3 cent loss, excluding certain charges, on revenue of $128.1 million. Yahoo! has forecast a break-even quarter, excluding certain charges, on revenue of $165 million to $185 million. In the second quarter of 2000, Yahoo! earned 12 cents on an operating basis on revenue of $270.1 million.

DoubleClick's shares, which have a 52-week high of $45.55, traded at $12.29 Friday morning, down 7 cents. Yahoo!'s shares, well off their 52-week high of $150, were up 9 cents to $17.89.