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Acacia Research slides as 3Q revenue drops

NEW YORK (AP) -- Shares of Acacia Research skidded to their lowest level in three years Friday after the company's third-quarter results fell short of Wall Street forecasts.

THE SPARK: Acacia, which buys and licenses patents, reported its results after the market closed Thursday. The company said it took a bigger loss, and excluding one-time charges its net income fell short of analyst estimates. Its revenue declined by more than half.

The company posted a loss of $15.7 million, or 33 cents per share. It lost $6.6 million, or 14 cents per share, a year ago. Excluding one-time items like stock-based compensation and patent amortization expenses, Acacia said it earned 11 cents per share, down from 14 cents per share a year ago. Revenue fell to $15.5 million from $34.9 million.

Analysts were projecting net income of 14 cents per share and $41.7 million in revenue, according to FactSet.

THE BIG PICTURE: Acacia Research Corp. said revenue from inventor royalties and contingent legal fees after expenses fell 50 percent to $10.6 million. Expenses related to patent enforcement and prosecution nearly doubled from a year ago, rising to $10.9 million from $6 million.

The Newport Beach, Calif., company said three of its largest revenue sources were responsible for 84 percent of its revenue in the latest quarter. A year ago five large licenses accounted for 73 percent of its revenue.

SHARE ACTION: Shares of Acacia Research fell $4.17, or 21.3 percent, to $15.45 in afternoon trading. Earlier in the day the stock reached a three-year low of $14.86. The shares last traded at that level in August 2010.