A continued decline in advertising revenues through 2003 was predicted by America Online in a soul-baring session Tuesday with Wall Street’s finest.

In confessional mode, the cyber colossus told investors, analysts and the press it expected profit and ad revenues both to remain depressed through 2003 with the green shoots of earnings growth reappearing in 2004.

Advertising and other commercial revenues would continue their decline next year by an eyewatering 40% to 50% – and that’s in addition to the unit’s expected 42% landslide this year from $2.6 billion (€2.6bn; £1.65bn) to $1.5bn. AOL’s overall revenue is expected to come in at around $8.8bn to $9bn.

In 2003 overall revenue will remain “essentially flat” with EBITDA (earnings before interest, tax depreciation and amortization) falling by 15% to 20%. This compares with the current year’s estimate of minus 15%.

Confessed AOL vice-chairman Ted Leonis: “We are a humbled company. We want our members to love us and need us once again.”

Unshrived, his plea fell on deaf ears. By yesterday’s close of trading, AOL shares on the New York Stock Exchange had fallen 14.24% to $14.21.

Data sourced from: The Wall Street Journal Online; additional content by WARC staff