RealNetworks Says It Will Miss Forecasts

RealNetworks Inc., which makes software for playing Internet audio and video, said second-quarter sales will fall short of forecasts, resulting in a net loss, as customers cut back on purchases of programs that distribute Web content.

The news, announced after the markets closed, sent the company’s shares down 18% in after-hours trading.

Sales will be $42.5 million to $45 million, down from $47.3 million last quarter, RealNetworks said. The loss will be 1 cent or 2 cents a share. Gross margin, or the percentage of sales left after production costs are subtracted, will be narrower than expected, the Seattle-based company said.

Analysts polled by Thomson First Call on average expected a second-quarter profit of 1 cent a share on sales of $50.3 million.

RealNetworks shares dropped to as low as $3.50, or by 18%, in extended trading. They had declined 18 cents to $4.29 on Nasdaq.