Overstock.com posts surprise qtrly loss on higher costs

Overstock.com posts surprise qtrly loss on higher costs

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(Global Markets) - Overstock.com Inc (OSTK.O) posted a quarterly loss while analysts had predicted a profit, hurt by higher costs, sending the discount e-retailer's shares down 8 percent in premarket trading.

The company, which saw its sales stumble after Google Inc (GOOG.O) penalized it for breaching some of search giant's guidelines in February last year, has been trying to attract online shoppers by spending more on advertising and marketing.

It has also been trying to woo shoppers with its Club O loyalty program to move away from less revenue generating coupons and other promotions.

The company said sales and marketing costs rose 10 percent and general & administrative and technology expenses shot up 24 percent in the quarter.

Overstock.com posted a fourth-quarter loss of $3.4 million, or 15 cents a share, compared with earnings of $14.9 million, or 63 cents a share, in the year ago period.

The company, which is attempting to rebrand itself from Overstock.com to O.co, said revenue fell 10 percent to $314.1 million in the quarter.

Analysts, on average, had expected the company to earn 45 cents a share, on revenue of $377.6 million, according to Thomson Global Markets I/B/E/S.

Overstock.com shares were trading at $6.32 in premarket trading. They had closed at $6.88 on Thursday on the Nasdaq.

(Reporting by Arpita Mukherjee in Bangalore)