IRVINE, Calif. -

Autobytel generated increased revenues and net income for the third quarter as the company reported its sixth consecutive quarter of profitability and seventh consecutive quarter of positive cash flow.

Officials tabulated that revenue for the third quarter that wrapped up on Sept. 30 increased 7 percent to $17.5 million, up from $16.3 million one year ago. Revenues generated from automotive purchase requests, the company’s core product offering, rose more than 12 percent to $15.1 million for the quarter, up from $13.5 million last year, primarily reflecting ongoing demand from automotive dealers and OEMs.

The company said advertising revenue improved 13 percent to $884,000 from $784,000 for the third quarter of last year.

Autobytel indicated third-quarter gross profit grew to $6.7 million, up from $6.6 million last year. Gross margin totaled 38.5 percent of total revenues for the third quarter, compared with 40.3 percent for the third quarter of last year.

“Gross margin declined as a result of investments in generating additional lead volume and further investment in our online content to drive increased growth,” officials said.

The company’s third-quarter total operating expenses came in at $6.1 million, the same as the year-ago period. Third-quarter total operating expenses included a $68,000, or $0.01 per diluted share, one-time impairment charge related to a long-lived asset.

Officials determined third-quarter net income grew 24 percent to $551,000 or $0.05 per diluted share, based on 10.1 million diluted average weighted shares outstanding.

Excluding the one-time impairment charge, net income for the third quarter would have been $619,000 or $0.06 per diluted share.

The company noted net income for the third quarter of last year was $446,000, or $0.05 per diluted share, based on 9.5 million diluted average weighted shares outstanding. Per share amounts reflect a 1-for-5 reverse stock split effected on July 11.

“Our ability to generate the company’s highest quarterly revenues in four years reflects ongoing strategic initiatives focused on further enhancing purchase request quality and volume for our auto dealer and OEM customers, while delivering a superior experience for consumers at Autobytel.com,” Autobytel president and chief executive officer Jeffrey Coats said.

“The quality improvements we’ve made are providing dealers with purchase requests that are yielding significantly higher sales conversion rates and, in turn, have resulted in increased demand, as we generated the highest level of dealer revenue in 11 quarters,” Coats continued.

“Favorable trends in the automotive market, combined with greater recognition for our brand, position us well for top- and bottom-line growth as we seek to capture additional market share,” he went on to say.

The company also mentioned cash flow provided by operations improved significantly to $1.5 million for the third quarter, compared with cash flow used by operations of $93,000 for the prior-year third quarter.

Officials added cash net income increased to $1.4 million or $0.14 per diluted share for the third quarter, up from $1.2 million, or $0.13 per diluted share, for the same quarter last year.

Based on its year-to-date financial performance, Autobytel said it is raising its 2012 net income forecast and now expects net income to triple compared with 2011 net income.

The company also expects year-over-year revenue growth of 3 percent to 5 percent for the year.