Despite falling ad income, AOL Time Warner posted a 6% rise in revenues and a 20% leap in earnings for the third quarter.
Advertising dollars dropped 5% year-on-year to $1.9 billion, but this fall was more than offset by a 13% rise in subscription revenue to $4.2bn and a 6% increase in content income to $3.2bn – producing overall revenues of $9.3bn, marginally ahead of expectations.
Chief executive Gerald Levin declared that AOL TW’s manifold interests would see it through the tough ad market: “The keys to our success in this difficult environment are clear. AOL Time Warner greatly benefits from the diversity of our revenue streams and the quality of our assets, built on a strong strategic and financial foundation.”
Nevertheless, the media mammoth was one of a host of companies issuing profits warnings in the aftermath of September 11, and dramatically reduced its full-year expectations [WAMN: 25-Sep-01].
EBITDA (earnings before interest, taxes, depreciation and amortization) stood at $2.5bn, while net losses widened to $996 million from $734m the previous quarter and $902m in Q3 2000.
Levin promised “much to look forward to in the fourth quarter and beyond,” not least the movie releases Harry Potter and the Sorcerer’s Stone and Lord of the Rings, both of which carry high expectations.
News source: Financial Times