Time Warner announced first quarter earnings today, giving us a peak at how AOL is doing. It’ seen better days. Revenues were down 23 percent to $867 million. Of that advertising revenues made up about half ($443 million), but were down a gut-wrenching 20 percent. Yahoo, in comparison, saw a 12 percent decline in advertising revenues during the quarter, and Google saw 6 percent growth in total revenues on an annual basis. Even Microsoft did better on the online advertising front, suffering a smaller 16 percent drop in the quarter.
Also revealed in the 10Q filing with the SEC is Time Warner’s intention to separate the old dial-up access business and spin off the rest of AOL:
Although the Company’s Board of Directors has not made any decision, the Company currently anticipates that it would initiate a process to spin off one or more parts of the businesses of AOL to Time Warner’s stockholders, in one or a series of transactions. Based on the results of the Company’s review, future market conditions or the availability of more favorable strategic opportunities that may arise before a transaction is completed, the Company may decide to pursue an alternative other than a spin-off with respect to either or both of AOL’s businesses.
New AOL CEO Tim Armstrong gets a pass this quarter because he was just hired away from Google in March. But he has to stop the bleeding before a spin-off or sale is possible. Meanwhile, on the product front, AOL is pushing forward with tweaks to its homepage that more fully integrate blogs, Twitter, and social networks. And AOL is positioning AIM and Socialthing as a single sign-on alternative to Facebook connect and Google Friend Connect.
Why is AOL’s subscription still that high? I can’t believe they have over 5 million subscribers. That’s crazy!
I wonder how many they had in the boom of AOL?
250k in 93, 1m in 95, 6 m in 96, 10m in 99. Lost track after that.
Can someone please explain to me why was Aol not merged with Time Warners other companies such as Roadrunner or Time Warner Cable
Also how did Aol become the subsidy when Aol brought Time Warner
wasn’t it the other way around?
No Aol brought Time Warner for 160 billion in stock
thanks
AOL was able to take over TW at a time when the dot.com era was happening. AOL was able to garner funding to buy out Time Warner but was unable to manage the bigger more successful company.
I remember that press conference with Case and Levin. I had never seen so much simultaneous camera flashes in my life. I think that was one for the record books. I think AOL was trying to become a legitimate media company because they didn’t have much more than a hugely inflated market cap. Levin and TW just seemed to be snowed by the money and felt that the internet bizarro media world was the new media physics. The stockholders were paid well, but I think after the initial glow began to fade, they asked themselves WTF were we thinking. Levin and Case didn’t last long after that. I remember thinking at the time that AOL didn’t have anything to offer TW. I think it was a case of AOL being really desperate to justify that market cap. They didn’t make much money and they didn’t own anything more than 20 million dial up customers, which weren’t like lifetime bank customers. People were jumping ISPs every few months back then.
Tim appears the right guy for the job just under enormous pressures. may all be too little, too late. Tim knows that without some serious rebranding AOL is never gonna stop bleeding.
best of skill
MyLocator.mobi
AOL sucks..no surprise there. The only people that use it are n00bs. Comcast limits your downloading. keep buying stocks http://iamned.com/blog/ swine flu fears overblown.
‘peek’ not ‘peak’