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LookSmart Ltd. Reports Operating Results (10-K)

February 28, 2011 | About:
10qk

10qk

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LookSmart Ltd. (LOOK) filed Annual Report for the period ended 2010-12-31.

Looksmart Ltd. has a market cap of $30.65 million; its shares were traded at around $1.78 with a P/E ratio of 35.6 and P/S ratio of 0.65. Hedge Fund Gurus that owns LOOK: Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

For the year ended December 31, 2010, our overall revenue was concentrated with two customers that are intermediaries, each accounting for more than 10% of net revenue and 25% in aggregate. For the year ended December 31, 2009, our overall revenue was concentrated with one customer, IAC Search and Media (IAC).

For the years ended December 31, 2010 and 2009, IAC accounted for 7% of net revenue and 69% of Publisher Solutions revenue, and 16% of net revenue and 81% of Publisher Solutions revenue, respectively. On May 19, 2009, IAC notified us that it did not intend to renew the May 2005 AdCenter License, Hosting and Support Agreement, which provides for certain Publisher Solutions services (the Agreement) upon its expiration. The Agreement, as amended, was scheduled to expire by its terms on December 31, 2009 but was extended in one month intervals through October 31, 2010 and expired on that date. In addition, Advertiser Network revenue, totaling $4.9 million, or 10%, for the year ended December 31, 2009, and $1.2 million, or 3%, for the year ended December 31, 2010, was derived from IAC under separate distribution agreements which were terminated in October 2010. We do not expect to generate Publisher Solutions or Advertising Network revenue from IAC in the future.

Search advertising accounted for substantially all of our revenues for the years ended December 31, 2009 and 2010. Our success depends upon search advertising customers choosing to use, and distribution network partners choosing to distribute, our search advertising networks products. Search advertising customers and distribution network partners may not adopt our products at projected rates, or changes in market conditions, may adversely affect the use or distribution of search advertisements. Because of our revenue concentration in the online search advertising business, such shortfalls or changes could have a negative impact on our financial results. Also, many of our products are offered to website publishers who use them to display or generate revenue from their online advertisements. Historically, our overall revenue has been concentrated with one customer, IAC Search and Media (IAC), accounting for 16% of net revenue and 81% of Publisher Solutions revenue for the year ended December 31, 2009, and 7% of net revenue and 69% of Publisher Solutions revenue for the year ended December 31, 2010. IAC notified us in May 2009 that it did not intend to renew the May 2005 AdCenter License, Hosting and Support Agreement (the Agreement), which provides for certain Publisher Solutions services, upon expiration on December 31, 2009, but was extended in one month intervals through October 31, 2010 and expired on that date. In addition, Advertiser Network revenue was derived from IAC under separate distribution agreements, totaling $4.9 million, or 10%, for the year ended December 31, 2009, and $1.2 million, or 3%, for the year ended December 31, 2010, which were terminated in October 2010. We do not expect to generate Publisher Solutions or Advertising Network revenue from IAC in the future. If we are unable to generate significant revenue from our online advertising business, or if market conditions adversely affect the use or distribution of online advertisements generally, or for some of our larger customers specifically, our results of operations, financial condition and/or liquidity will suffer.

Read the The complete Report

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