WebMD Health Corp. (WBMD), the online provider of medical information, fell to its lowest value in almost four years after the company said it expected a loss this year because of advertising cuts by drugmakers.
WebMD dropped 18 percent to $14.65 at the close of New York trading, its lowest closing price since October 2008. The full- year loss may be $12.4 million to $23.4 million, the New York- based company said in a statement today. WebMD on May 1 had forecast a profit of $2.8 million to $19.9 million.
The company, which gets more than 80 percent of revenue from advertising and sponsorships, said it expects customers to “re-evaluate expenditures,” including marketing, as they deal with drug-patent expirations and delays in product approvals. Chief Executive Officer Cavan Redmond, who took over the spot last month, said he was looking for “cost efficiencies” across the company.
“I am reevaluating the company’s infrastructure across- the-board to drive operational improvements,” Redmond said in the statement. “The challenges are clear. However, I believe the opportunities are considerable.”
The shares have fallen 61 percent this year.
WebMD said in a January regulatory filing that it had broken off talks with potential buyers after concluding that any offers would be less than its market value. the company was worth $735.6 million by the close of trading.
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