AOL Earnings Cheat Sheet: Fifth Straight Quarter Sales Drop Double-Digits

May 04, 2011

AOL Inc. (NASDAQ:AOL) saw profit fall amid falling revenue. AOL Inc. is a global web services company whose business consists of online content, products and services that it offers to consumers, publishers and advertisers.

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AOL Earnings Cheat Sheet for the First Quarter

Results: Net income for the internet information provider fell to $4.7 million (4 cents/share) vs. $34.7 million (32 cents/share) a year earlier. A decline of 86.5% from the year earlier quarter.

Revenue: Fell 17% to $551.4 million YoY.

Actual vs. Wall St. Expectations: The mean estimate for AOL was 17 cents/share. Estimates ranged from 2 cents per share to 33 cents per share.

Quoting Management: “Today represents an important milestone in the turnaround of AOL as global display revenue grew for the first time since Q4 2007,” said Tim Armstrong, Chairman and CEO. “I am proud of the work completed thus far and we remain focused on accelerating our momentum through continued execution of our strategy to become the premier digital content company.”

Key Stats: Gross margins fell 15.6 percentage points to 29.5%. The contraction appeared to be driven by falling revenue, as the figure fell 17% from the year earlier while costs rose 6.6%.

Over the last five quarters, revenue has fallen an average of 23.9% year over year. The biggest drop came in the third quarter of the last fiscal year, when revenue fell 27.4% from the year earlier quarter.

Competitors to Watch: Google Inc. (NASDAQ:GOOG), Yahoo! Inc. (NASDAQ:YHOO), Microsoft Corporation (NASDAQ:MSFT), IAC/InterActiveCorp (NASDAQ:IACI), Disney (NYSE:DIS), News Corporation (NASDAQ:NWSA), The New York Times Company (NYSE:NYT), CBS Corporation (NYSE:CBS), Time Warner (NYSE:TWX), Gannett (NYSE:GNI) and Baidu.com, Inc. (NASDAQ:BIDU)