Cybercash Inc. disclosed last week that its second-quarter revenues would fall below analysts' expectations.

In yet another sign of the difficulties facing entrepreneurial Internet payment and commerce ventures, Cybercash said its quarterly gross would be $2.2 million to $2.5 million, whereas analysts had been projecting $3 million to more than $4 million.

The Reston, Va., company plans to issue its earnings report July 27.

Its stock price was $11.125 at Thursday's close, down from the previous Friday's $14.5625 and near the 52-week low of $10.4375. At its 52-week high the stock traded at $26.875.

Cybercash concurrently announced it laid off about 40 employees, leaving its staff at just under 200.

The earnings shortfall is not of great concern to electronic commerce analyst Gary R. Craft of BancAmerica Robertson Stephens.

"I don't see much of a setback longer term," said Mr. Craft, a senior vice president, who rates the stock "long-term attractive." "There is not much to read into this."

The company noted quarterly revenue would compare favorably with the $812,000 in last year's second quarter.

Recent growth was stunted by Cybercash's purchase of on-line credit card software company ICVerify Inc., Cybercash said.

"Some customers of both companies delayed making purchase decisions while they assessed the impact of the acquisition," according to a press release. In addition, a setup fee of $495 for merchants was imposed in April, causing a "temporary slowing" in growth of the merchant base.

Cybercash plans to cut expenses and narrow its focus, said Maria Izurieta, vice president for finance. The company plans to build partnerships with financial institutions and Internet portals such as Yahoo, Ms. Izurieta said. "Our merchant counts and transaction volumes continue to rise."

Cybercash said sales of software to gain access to the payment processing service have resumed. Currently 4,500 merchants use the service, which processes 2.5 million transactions a month.

Mr. Craft anticipates a break-even bottom line in early 1999, an opinion he did not change with the latest announcement.

Customers often "waffle" when companies merge, the analyst said. He compared the situation to a software upgrade, which can also cause prospective buyers to hesitate.

Ulric Weil, senior technology analyst with Friedman, Billings, Ramsey & Co., said Cybercash has a good management team that understands the industry. He said he is confident earnings will turn around but conceded Cybercash is growing slower than expected.

Other Internet payment companies also are struggling as conventional credit cards account for the bulk of on-line payments. First Virtual Holdings Inc. of San Diego, which pulled back from an ambitious electronic payment strategy to focus on interactive advertising, closed at $2.5625 on Thursday, down from a 52-week high of $6.75.

Open Market Inc., a leader in creating merchant sites for Web commerce, has been trading at $14 to $19 over the last two months, inching back toward a 52-week high of $23.37.

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