Orbitzis is down over 5% today after posting a fourth-quarter net loss and lowering its forecast for earnings for the first quarter to $177 million-$184 million below analysts’ expectations of $194 million.On a conference call with analysts Orbitz CEO Barney Harford said the U.S. leisure business is being impacted by the American Airlines fallout and that he recognised the significance of finding a resolution with the airline.
- Orbitz reported a net loss of $78 million or $0.76 per share compared to a net loss of $18.1 million in the prior year. Analysts expected a loss of $0.05 per share.
- Revenue for the fourth quarter did beat expectations with a rise of 4% to $182.4 million mostly due to its hotel bookings business
- It was downgraded by Piper Jaffray and had its earnings forecast and price targets lowered by UBS today
- Revenue from American Airlines tickets booked on Orbitz.com and Orbitzforbusiness.com contributed about 5% to the company’s 2010 revenue.
- Shares have dropped 35% since the December fallout with American Airlines.
- UBS analyst Kevin Crissey wrote in a research note this morning, “The nearer-term upside catalyst potential, in our view, would be a resolution of its distribution spat with American Airlines (and a pick-up in domestic air volumes).”