Monster Expects 1st Quarter Loss As It Spends To Gain Share

Sensing opportunity admist the shambles of the world economy, Monster’s CEO says the company will spend enough on marketing and organizational changes during the first quarter of this year that it won’t be profitable.

“We don’t want to overreact,” Sal Iannuzzi said, referring to the worldwide recession and the belt-tightening going on everywhere. While Monster intends to be frugal, he said the company will “aggressively pursue the market share.”

Doing that, and making other one-time financial expenses, will cut into the company’s 1st quarter revenues, which are expected to be off over the same quarter in 2009, by about the same 16 percent as the last quarter of 2008.

The net result, Iannuzzi said, will make Monster unprofitable for the first quarter. That will turn around in the second quarter.

Iannuzzi’s comments came during today’s quarterly call with financial analysts to discuss Monster’s 4th quarter and 2008 financial results.

During the hour-long call, Iannuzzi and other Monster executives said they were encouraged by the response to the revamped Monster site that launched January 10th. Job searches are up, feedback from users has been positive, and even the clickthrough rate for ads running on the Monster network have doubled and even tripled.

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The newspaper partnership has been a positive for Monster, Iannuzzi said in response to one analyst question. “As time’s gone on, things become more profitable,” he reported.

Both Iannuzzi and CFO Tim Yates spent time explaining the company’s acquisition of ChinaHR. In October, Monster acquired the remaining 55 percent  for $174 million, a price that was negotiated down from the original purchase terms.

The job board, one of the largest in China, has suffered declines along with the hit that country’s economy has taken causing an after tax loss of $3.7 million. Now, with Monster in full control, there have been some layoffs and other cost- cutting measures are being implemented.

John Zappe is the editor of and a contributing editor of John was a newspaper reporter and editor until his geek gene lead him to launch his first website in 1994. He developed and managed online newspaper employment sites and sold advertising services to recruiters and employers. Before joining ERE Media in 2006, John was a senior consultant and analyst with Advanced Interactive Media and previously was Vice President of Digital Media for the Los Angeles Newspaper Group.

Besides writing for ERE, John consults with staffing firms and employment agencies, providing content and managing their social media programs. He also works with organizations and businesses to assist with audience development and marketing. In his spare time  he can be found hiking in the California mountains or competing in canine agility and obedience competitions.

You can contact him here.


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