Time Warner Inc. reported a 27 per cent decline in second quarter earnings Wednesday compared with the same period a year ago, when the company recorded large gains from investments and a settlement with Microsoft Corp. Other measures of profitability as well as revenues rose.
The giant media conglomerate, whose operations include CNN, Warner Bros. and HBO, reported net income of $777-million, or 17 cents a share, for the three months ending in June, versus $1.06-billion, or 23 cents a share, a year earlier.
However, revenues rose a robust 10 per cent to $10.89-billion from $9.92-billion as the company saw improvements in all of its major business lines, including its long-troubled America Online unit. AOL continued to lose dialup customers, but its revenues and profitability both increased.
The results were well ahead of analysts' expectations. Excluding a loss of two cents per share from its Warner Bros. music business, which was sold to an investor group, the company had earnings of 19 cents per share versus an estimate of 15 cents per share by analysts surveyed by Thomson First Call.
In the year-ago period, the company earned 11 cents per share excluding the Microsoft settlement, investment gains, accounting charges and other one-time items.
Time Warner also raised its estimate for full-year results, saying it now expected to post per centage gains in the low double-digits to low-teens range in operating income before depreciation and amortization. The company has previously forecast gains in the low double digits.
For the first six months of the year, Time Warner reported earnings of $1.74-billion, or 37 cents a share, against $1.46-billion, or 32 cents a share, in the comparable period a year ago. Six-month revenues rose 10 per cent to $21.01-billion from $19.16-billion.
