Earnings: AOL Ad Revs Up 45 Percent, Two Million Subs Left In Last Year

Time Warner’s Q105 earnings release kicks off with words we’re not used to seeing lately — driven by growth at AOL along with cable and networks. Note inclusion of AOL, a sign that the division’s switch to a hybrid walled-garden/open web model is paying off. It was AOL’s highest quarterly profit in 3 years. AOL’s revenues dropped 3 percent to $2.1 billion from $2.2 billion a year ago but operating income rose to $324 million from 277 million year over year. The 45-percent increase in ad revenues offset the 8-percent decline in subscription revenues. the advertising revenues included a $27 million-increase in paid search and $60 million from the Advertising.com acquisition. As of March 31, AOL had 21.7 million U,S. subs, down 549,000 from Q404 and 2.3 million since 1Q04.
Meanwhile, high-speed signups and digital services helped the Cable segment improve revenue to $2.246 billion from $2.043 billion and operating income to $426 million from $385 million. High-speed revenues were up 19 percent, while digital video services rose 21 percent. The average monthly revenue — ie that bill TW Cable customers see every month — rose 10 percent to about $80. Residential high-speed jumped by 209,000, giving TW Cable 4.1 million HSD subs. DVR subs almost broke the million mark, with more than 20 percent of digital subs signing up.
No mention of online revenues for either networks or publishing.
For a corporate overview: USAT/AP | MKTW | TheStreet.com TW Release | Webcast | Slides

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