blinkx shares collapse on warning
July 2, 2014
In a statement, blinkx revealed that its performance over the past three months was worse than expected due to “industry-wide issues of efficiency and effectiveness”, exacerbated by “the lingering effects” of a disparaging blog about the company”
blinkx was spun out of Autonomy, the computer software company. The San Francisco company places branded video and banners alongside relevant content on the internet.
In January, Ben Edelman, an associate professor at Harvard Business School, published a critical blog post that prompted blinkx’s stock to price to plummet almost 50 per cent. Edelman raised questions over the way blinkx generates traffic for its content. blinkx released a detailed rebuttal, claiming Prof Edelman had made “numerous factual errors”.
blinkx said that in the past three months demand had been lower than forecast, resulting in a corresponding shortfall in revenues and profit. It said earnings before interest, tax, depreciation and amortisation for its first half to the end of September would be $5 million lower than management expectations.