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blinkx rockets on strong numbers

LONDON (SHARECAST) - blinkx, the world’s largest internet video search engine, has trumped market forecasts, more than doubling full-year revenue thanks mainly to stronger than expected volume growth.

Revenue soared to $33.7m in the year to 31 March from $13.9m last time as the daily video search run rate increasing by 169% to 22.6m searches per day in March. It was just 8.4m a day in March 2009.

The San Francisco-based business narrowed the annual loss slightly to $8.5m from $8.9m, but the firm was profitable at the EBITDA level in the second half.

Piper Jaffray reckons that with strong momentum expected to continue into FY11, the business remains well placed to significantly reduce operating losses to about $5.7m and grow revenue by a third to $40m.

“The better than expected revenue trajectory in the business implies the potential for upgrades here, and a more rapid achievement of break-even,” it said, repeating ‘overweight’ advice and 26p price target.

Citi is also impressed. It’s predicting 100% revenue growth in 2011 to $58.3m and positive EBITDA of about $9.6m, but, based on current growth trajectories for search volumes, customer numbers and CPMs, “these forecasts look eminently achievable, indeed potentially conservative”.

It rates Blinkx a speculative buy and maintains its fair value estimate at 55p.