Jiayuan.com Plunges After Poor Earnings, Analyst Downgrades

Shares of Jiayuan.com (NASDAQ: DATE) are seeing much pressure during Tuesday's trading session after the company reported fourth quarter results yesterday, which did not live up to analysts' expectations.

Jiayuan's net revenues for the fourth quarter of 2011 were RMB88.6 million (US$14.1 million), in line with guidance; however, lower than the estimates of $16.68 million.

Operating loss for the fourth quarter of 2011 was RMB4.3 million (US$690,000), compared to operating income of RMB13.2 million for the corresponding quarter of 2010. Excluding share-based compensation, non-GAAP(2) operating loss for the fourth quarter of 2011 was RMB322,000 (US$51,000), compared to non-GAAP operating income of RMB15.3 million for the corresponding quarter of 2010.

The operating loss and non-GAAP operating loss are primarily attributable to a higher selling and marketing expense, including RMB10.0 million resulting from a special marketing campaign conducted during the quarter, as well as an increase in personnel costs due to year-end bonuses being accrued during the quarter.

Bank of America lowers its rating on Jiayuan.com to Underperform and trims its price objective to $6.60 (previously $13) as marketing cost pressure is expected to continue to plague the company.

Currently, shares of Jiayuan.com are trading down about 18.33% at $5.66 per share.

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