WebMD Loss Widens

Shares ease on a soggy outlook.
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WebMD

(WBMD)

, a health care Web site, said its first-quarter loss widened as it incurred additional costs for expensing stock options.

The loss was $4.2 million, or 7 cents a share, compared with $956,000, or 2 cents, a year earlier. Revenue rose 48% to $50.1 million, the New York-based company said in a statement. Four analysts surveyed by Thomson Financial had expected a loss of 9 cents on sales of $47.1 million.

"I am enthusiastic about the momentum that is building in our business,'' says WebMD Chief Executive Wayne Gattinella in a statement. "We delivered strong revenue and earnings growth this quarter while continuing to invest in our technology and other distribution. We are beginning to see the financial leverage in our business model and are well positioned to capitalize on the fast emerging trends in the healthcare industry."

Investors apparently were expecting more from WebMD, whose shares have jumped 52% since the start of year, making it one of many small Internet companies that have outperformed the giants including

Yahoo!

(YHOO)

,

Google

(GOOG) - Get Report

and

eBay

(EBAY) - Get Report

. Its shares rose 20 cents to $44.25 in after-hours trading.

The loss in the current quarter will be between 5 cents and 7 cents on sales of between $53 million and $55 million, the company said in a filing with the

Securities and Exchange Commission

. Analysts expected a loss of 5 cents on sales of $53.5 million, according to Thomson Financial.

Results this year will be between a net loss of $3.9 million, or 7 cents, to a profit of $200,000, or nothing per share, WebMD said. Revenue will be $229 million to $238 million. Four analysts surveyed by Thomson Financial had forecasted profit of a penny on sales of $227 million, according to Thomson Financial.

Like other online publishers, WebMD is benefiting from the shift of advertising dollars online. In the quarter, advertising and sponsorship revenue jumped 44% to $32.8 million, while private portal licensing revenue increased 97% to $11.4 million. Unique visitors and page views both jumped more than 20%.

Most of the company's shares are owned by

Emdeon

(HLTH)

, a provider of software and consulting services to the health care industry.