Oct 31 (Reuters) - Ellie Mae Inc, whose software isused by mortgage professionals, reported a lower-than-expectedthird-quarter profit, hurt by lower mortgage volumes and higherR&D spending, pushing its shares down more than 20 percent afterthe bell.
Eliie Mae, whose software is used for loan processing and tointeract with lenders and investors, said its net income halvedin the quarter ended Sept. 30 and warned of lower-than-expectedearnings in the fourth quarter.
The company forecast earnings of 17 cents to 18 cents pershare for the fourth quarter, well below the 24 cents expectedby analysts, according to Thomson Reuters I/B/E/S.
It forecast revenue of $29.5 million to $30.5 million, belowthe estimated $32.5 million.
Total mortgage origination volumes is expected to fall 14percent to $1.8 trillion in 2013, according to the compositequarterly forecast of Fannie Mae, Freddie Mac and the MortgageBankers Association.
Ellie Mae's net income nearly halved to $3.36 million, or 12cents per share, in the third quarter from $6.83 million, or 25cents per share, a year earlier.
Revenue rose 20 percent to $33 million.
Analysts had expected earnings of 30 cents per share onrevenue of $34.4 million, according to Thomson Reuters I/B/E/S.
"Although we had impressive revenue growth year over year,it was not as strong as we had expected," Chief Executive SigAnderman said.
R&D expenses rose more than 38 percent to $6.57 million.
The company also said it acquired MortgageCEO, a softwarecompany specializing in customer relationship management for theresidential mortgage industry.
Bloomberg reported in August that Ellie Mae was exploring asale and had interviewed banks to manage the process.
Ellie Mae's shares closed at $28.90 on Thursday on the NewYork Stock Exchange. They were down 17 percent at $24.00 inextended trading.
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