Blackboard swings to 1Q loss with rising operating expenses

WASHINGTON—Educational software company Blackboard Inc. said Wednesday that it swung to a first-quarter loss as rising product revenue was overshadowed by climbing operating expenses.

For the quarter that ended March 31, Blackboard reported a loss of $3.3 million, or 11 cents per share, compared to a profit of $1.9 million, or 7 cents per share, in the year-ago quarter. On an adjusted basis, Blackboard earned 6 cents per share in the first quarter.

The company's revenue rose 23.9 percent year over year to $68.5 million.

Analysts polled by Thomson Financial expected the company to break even on $65.5 million in revenue. The estimates generally exclude special items.

Blackboard's product revenue rose 26.3 percent to $63.1 million, while professional services revenue increased 1.3 percent to $5.4 million.

The company said it saw ongoing strong growth in licensing and managed hosting sales and better-than-anticipated results from its recently completed purchase of The NTI Group.

Blackboard's operating expenses also rose, climbing 41.2 percent to $72.9 million, with acquisition-related expenses and sales and marketing expenses rising. The company's cost of product revenues also rose.

Blackboard shares fell 47 cents to $35 in after-hours trading after finishing the regular session down 37 cents at $35.47.