Critical Path

(CPTH)

will downwardly revise its previously reported fourth-quarter financial results, less than a month after the company

badly missed estimates for the period, by reporting a loss when Wall Street was looking for a profit.

Shares of Critical Path plunged on the news, recently losing $7, or 70%, to $3 in

Nasdaq

activity.

On Jan. 18, Critical Path reported fourth-quarter revenue of $52 million and a loss, excluding special charges, of $11.5 million, or 16 cents a share. Based on the preliminary results of an investigation by a special committee of the board, Critical Path expects to remove $6.5 million to $8 million from the top line.

The company, a provider of business-to-business Internet messaging infrastructure, said about $4.2 million involved transactions that won't result in revenue. The remainder may lead to revenue that will be recognized during 2001. Critical Path also expects to add $1 million to $2 million to its previously reported fourth-quarter costs and expenses. The revisions will cause the company's loss for the fourth quarter, excluding items, to widen to a range of $19 million to $21.5 million, or 27 cents to 30 cents a share.

Earlier this month, Critical Path, which is based in San Francisco, said it would investigate its

revenue-recognition practices and placed two executives on administrative leave.