AOL Inc. Earnings Cheat Sheet: Increased Costs Strains Margins

August 09, 2011

AOL Inc. (NASDAQ:AOL) reported its results for the second quarter. 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.

Investing Insights: Steve Jobs Prepares to Deliver a New Catalyst for Apple’s Stock >>

AOL Earnings Cheat Sheet for the Second Quarter

Results: Loss narrowed to $11.8 million (loss of 11 cents per diluted share) from $1.05 billion (loss of $9.89 per share) in the same quarter a year earlier.

Revenue: Fell 8.4% to $542.2 million from the year earlier quarter.

Actual vs. Wall St. Expectations: AOL fell short of the mean analyst estimate of one cent per share. It beat the average revenue estimate of $530.4 million.

Quoting Management: ”AOL’s return to global advertising growth for the first time since 2008 reflects the hard work of our team and another meaningful step forward in the comeback of the AOL brand,” said Tim Armstrong, Chairman and CEO. “AOL is singularly focused on becoming the next great media company for the digital age and we have positioned the company’s best people, technology and assets in front of some of the largest opportunities on the internet.”

Key Stats:

Revenue has fallen in the past four quarters. Revenue declined 17% to $551.4 million in the first quarter. The figure fell 26.1% in the fourth quarter of the last fiscal year from the year earlier and dropped 27.1% in the third quarter of the last fiscal year from the year-ago quarter.

The company fell short of forecasts after beating estimates in the previous two quarters. In the first quarter, it topped the mark by 2 cents, and in the fourth quarter of the last fiscal year, it was ahead by 18 cents.

Competitors to Watch: Google Inc. (NASDAQ:GOOG), Yahoo! Inc. (NASDAQ:YHOO), Microsoft Corporation (NASDAQ:MSFT), IAC/InterActiveCorp (NASDAQ:IACI), Demand Media Inc (NYSE:DMD), News Corporation (NASDAQ:NWSA), The New York Times Company (NYSE:NYT), CBS Corporation (NYSE:CBS), and Baidu.com, Inc. (NASDAQ:BIDU).

Investing Insights: Steve Jobs Prepares to Deliver a New Catalyst for Apple’s Stock >>