Time Warner Preview: AOL Watch; 75 Corp Layoffs; Time Warner Cable

Time Warner (NYSE: TWX) reports its first quarterly under Jeff Bewkes tomorrow and analysts are predicting rather slim year-over-year growth at the top end. But it’s safe to say that the actual numbers will be just a small part of what people are watching for (yes, that sounds familiar). The company’s AOL unit is always the subject of a lot of speculation, but Microsoft’s (NSDQ: MSFT) proposed $44.6 billion acquisition of Yahoo (NSDQ: YHOO) renewed the drumbeat on the AOL question. Overall, the question is whether the early days of the Bewkes regime will resemble what we’ve seen from Jerry Yang at Yahoo since his return, or if he’ll actually make some big moves. Some things to watch for:

AOL: If only Time Warner got a dollar every time someone told it what to do with AOL, it might have been a profitable acquisition. The company has been on a mission to reformulate the unit as an online advertising powerhouse through its Platform A efforts, but investors want to see something meatier. Again, if Bewkes doesn’t make some substantive comments about the future of this unit, it will be disappointing, especially since the changing of the guard, from Parsons to Bewkes, was thought to have opened the door to a more radical shakeup. If an outright sale is out of the cards, and it’s not clear who would be a buyer (Google (NSDQ: GOOG), perhaps), especially with Yahoo and Microsoft a bit tied up these days, then some other strategic alliance may be explored. As Bear Stearns analyst Spencer Wang recently noted, if nothing else, Microsoft’s bid for Yahoo means that internet assets with some audience does have market value.

Layoffs: AdAge reports that Time Warner will announce 75 layoffs at its corporate offices tomorrow. Obviously, this is a drop in the bucket for the company, but without much growth at the top, the calls for cost cutting will only increase. Laying off 75 employees is a start, but if it’s the only significant cost-cutting or restructuring move announced, this will prove disappointing.

Time Warner Cable: The company still owns 84 percent of the separately-traded cable operator, which, like Comcast (NSDQ: CMCSA), has been a major loser over the past year. If it chooses to dump more now, it might be selling out at the bottom. But as long as it holds on to the unit, the stock of the parent company may continue to be dragged down. This division also reports earnings tomorrow.

Other: Rich Greenfield at Pali Capital has posted a list of 10 questions (reg req’d) he would like to have answered tomorrow. Among them: Does TWX management use any of AOL’s services? How much of AOL’s business is coming from its acquisitions? What’s the impact of MSFT-YHOO on AOL?

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