Demand Media Inc (NYSE:DMD) sent out an e-mail to thousands of freelance writers that indicates that they will be scaling back the number of stories that they need. Demand Media is assigning a less number of stories because they feel like they have a strong backlog of material.

Demand Media Inc (NYSE:DMD) released their Q2 earnings today and has announced that they have made two acquisitions. Demand Media acquired IndieClick and RSS Graffiti. IndieClick is a blog ad network and RSS Graffiti is a social media product developer. Demand Media expand their ad sales partnership with Google too.

Demand Media Inc (NYSE:DMD) is a company that was founded in 2006 by Richard Rosenblatt. Rosenblatt was previously the CEO of MySpace parent company Intermix Media before News Corp. acquired them. Demand Media went public earlier this year and reported their first quarter earnings today. Demand Media reported $79.5 million in revenues for the quarter, which is a 48% increase from their Q1 2010 revenues of $53.6 million. Analysts were expecting $69.49 million in Q1 revenues.

Demand Media has acquired CoverItLive. CoverItLive is a liveblogging service for people to cover live events in real-time such as earning calls and product launches. The financial details were undisclosed. CoverItLive is the liveblog service that was used by People, EW, Variety, and TMZ to cover Oscar ceremonies. Demand Media had already acquired a minority interest in CoverItLive two years ago.

You would think that Demand Media Inc (NYSE:DMD) would be worried about Google’s algorithm change to weed out content farms, but they aren’t. eHow.com is one of Demand Media’s top websites and traffic to that website highly depends on Google search results. eHow.com is considered to be a content farm and it isn’t exactly being weeded out. Based on a search test by The Atlantic, it turns out that websites like Lifemojo.com, Blogspot.com, Bloglines.com, and About.com are being penalized. Demand Media said that they talked about the algorithm change during the Q4 earnings this past Tuesday. They shared metrics about direct visits, social visitors, and repeat visitors. It turns out that these metrics indicate that Demand Media’s web properties have developed into recognizable consumer brands with a loyal community. [Demand Media Blog]

Demand Media Inc (NYSE:DMD) stock jumped about 33% in their first day of trading. Demand Media is best known as being a content farm that runs web sites like eHow, Livestrong.com, Cracked.com, Trails.com, GolfLink.com, and AnswerBag.com. Demand Media price their shares at $17 and now it is trading at about $21. It got as high as $22.65 per share during the company’s first day of trading, giving them a market value of $1.87 billion. Demand Media raised about $151.3 million in the IPO.

Demand Media is working with Goldman Sachs Group, Inc. (NYSE:GS) to explore a potential IPO. Demand Media has raised a total of $355 million from Goldman Sachs, Spectrum Equity Investors, Generation Partners, and Oak Investment Partners. Demand was founded by former MySpace Chairman Richard Rosenblatt.

Yahoo! Inc. (NASDAQ:YHOO) SVP of U.S. Revenue and Market Development Joanne Bradford is leaving to join Demand Media.  She will take the position of Chief Revenue Officer at Demand Media. Bradford previously work as chief media officer of MSN Media Network.  She also worked at BusinessWeek and Spot Runner. [AllThingsD]