14 DAY TRIAL // AOL just made its first financial report as an independent company in almost a decade. The company isn't doing great and even the execs were careful not to sound too optimistic. However, despite the poor results and the hard path ahead, AOL seems rather confident that it's heading in the right direction. For what it's worth it was also profitable in Q4, but a net income of $1.4 million on revenues of $810 million isn't going to break to the bank.
“We have made significant progress in support of the long-term vision we see in the future of AOL, but today’s results continue to reflect the need for our focus and execution on the work required in the turnaround of the Company,” Tim Armstrong, AOL CEO, said. “2009 marked the closing of an important chapter in AOL's history and the opening of a new chapter that we are passionately pursuing. We have a clearly defined strategy, and we enter 2010 incredibly focused on day-to-day execution.”
Compared to last year's loss of $1.96 billion reported by Time Warner, which was still its parent company, $1.4 million looks positively glowing. Of course, Q4 2008 was when Time Warner wrote down AOL leading to the high loss figure. Revenue was down from a year ago though, 17 percent from $974 million in Q4 2008 to just $810 million in the last quarter. Still, the results were above the market expectations which hovered at slightly above $700 million in revenue.
Advertising brought in the bulk of the money, $471.6 million, and was only down 8 percent from 2008's $512.5 million. Subscription revenue saw a much bigger drop though, completely expected, going down 28 percent from $429.4 million to $307.4 million. In the subsequent conference call, AOL execs were cautious to not sound too optimistic. Armstrong reiterated that there are still many hurdles to overcome and the company still has to change a lot of things before it can think about growth again. Still, the current plan holds focus on content, advertising and partnerships.