Athenahealth Slips To Loss, Misses Street

(RTTNews) - athenahealth Inc (ATHN) on Thursday reported a slip to loss in the first quarter, hurt by lower margins even as revenues jumped 30 percent. Both earnings and revenue for the quarter came in short of Wall Street estimates.

Moving forward, CEO Tim Adams said that the company sees signs of positive momentum, having grown its core physician network by 31 percent.

Following the announcement, athenahealth shares slid 10 percent in the initial after-hours trading on the Nasdaq, but subsequently the stock pulled back to trade 1 percent lower.

Watertown, Massachusetts-based athenahealth posted quarterly net loss of $8 million or $0.21 per share, compared with net earnings of $0.07 million or $0.02 per share last year.

Results for the recent quarter included stock-based compensation expense of $12 million and amortization expense of $7 million.

Excluding items, adjusted earnings for the quarter were $4.4 million or $0.12 per share, compared with $14 million or $0.38 per share a year ago.

On average, 26 analysts polled by Thomson Reuters estimated earnings of $0.17 per share for the quarter. Analysts' estimates typically exclude special items.

An Internet-based business service provider for physician practices, athenahealth's revenues for the quarter jumped 30 percent to $163 million from $125.6 million in the prior year.

Twenty-two analysts had a consensus revenue estimate of about $170 million for the quarter.

Core revenues were up 23 percent.

Adjusted gross margin for the quarter decreased to 59.8 percent from 60.4 percent last year, and adjusted operating margin fell to 5.4 percent from 7.5 percent.

The quarter included a tax benefit of $4.5 million, compared with a benefit of $12.7 million a year ago.

The company's stock closed Thursday at $145.58, down $2.29 or 1.55% on a volume of about 664k shares. In after hours, the stock dropped $1.58 or 1.09% at $144.00.