Digital River Improves Business Solution (DRIV)

Digital River, Inc. (DRIV) recently improved its Partner Management Solution by adding even more business-to-business (B2B) capabilities to its Global Commerce enterprise system.

B2B companies can now use this cloud-based solution and thereby, easily build and deploy private, online portals to enable their individual resellers or channel partners to sell directly to business buyers globally.

Companies such as software publishers, electronics manufacturers and medical device companies can now use this Partner Management solution to help attract more partners, reduce partner administration, curtail order and transaction costs, improve customer satisfaction levels, and thereby, expand their channel businesses on a worldwide basis.

Digital River makes continuous innovations in its business solutions to assist companies to turn untapped opportunities into healthy revenue streams.

The Partner Management Solution from Digital River includes a flexible set-up wizard for creating private online purchase portals which is designed to help companies manage their channel partner program more efficiently. In addition, the solution also enables companies to target tightly segmented buying groups.

Last month, Digital River reported revenues of $90.8 million in the second quarter of 2012, down 1.8% from a year ago. This was far below management’s revenue guidance of $92 million to $94 million.

Net income came in at $200,000 or 1 cent per diluted share compared to a net income of $291,000 or 1 cent per diluted share in the year-ago quarter. The reported results were better than management’s estimates of a loss of 2 cents per share to break-even earnings.

Excluding one-time items but including stock-based compensation, net income per share came in at 6 cents per share, beating the Zacks Consensus Estimate of 4 cents per share.

Going forward, Digital river continues to be wary of softness in the global markets, especially weaker PC sales and uncertain economic environment.

We continue to maintain a Neutral recommendation on Digital River. Our recommendation is supported by a Zacks #3 Rank, which translates into a short-term rating of Hold.