Web Site Delay Costs Audible

The company warns that full-year results will disappoint.
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Full-year results at

Audible

(ADBL)

will come in below expectations as the delayed launch of the Web audio provider's new Web site hurt operations.

Following the announcement, shares of Audible slid 12.1% to $11.46 in after-hours trading on Instinet.

The company said late Tuesday that it now expects revenue in 2005 of $62 million to $64 million, vs. prior guidance of $62 million to $65 million, and is anticipating a pretax loss of $1 million to $1.5 million -- below its prior guidance of pretax income of $1.6 million to $2 million.

Both estimates exclude a stock-based compensation expense of roughly $930,000.

"The fourth quarter was a major milestone for Audible, as we launched a new Web site and new membership plans that we consider key to our future growth and success. The site, however, launched considerably later than planned, and this impeded new customer acquisitions and revenue and, in turn, our gross profit," stated Donald Katz, chairman and CEO of Audible. "The most important factor contributing to the loss was higher than anticipated marketing and operating expenses incurred during the quarter."

"The good news is that we saw significantly lower churn rate for the quarter versus the third quarter and record traffic and sales at the end of December as the new Web site began to perform. This has continued into early January," Katz said.