Time Warner lowers 2008 outlook on restructuring

NEW YORK - Time Warner Inc. lowered its full-year outlook Wednesday, saying the weak economy and various restructuring charges will weigh down profits.

The media conglomerate said it now expects earnings of $1.04 to $1.07 a share from continuing operations this year, down from its prior outlook of $1.07 to $1.11 per share provided in February.

Analysts polled by Thomson Reuters have been expecting $1.07 a share — the high end of Time Warner's new guidance.

Time Warner said it has incurred about $182 million in restructuring charges through the third quarter, mostly for the absorption of the New Line Cinema studio into the larger Warner Bros. Entertainment unit in February.

The company also expects to take a charge of $100 million to $125 million in the fourth quarter primarily for planned job cuts at its struggling Time Inc. magazine business.

The New York Times reported last week that Time Inc. would cut 6 percent of its work force, or more than 600 positions. Time officials told The Associated Press the specific number was still being determined.

Time Warner also cited "the challenging economic environment facing certain of the company's businesses," but did not provide details.

Across the industry, spending on advertising has been declining because of the weak economy. Time Warner's AOL online unit, increasingly dependent on advertising revenue, saw a 6 percent drop in third-quarter ad revenue, while ad revenue at Time Inc. fell 8 percent.

But the cable-networks division, which includes CNN, saw ad revenue grow 9 percent. Many broadcast and cable networks have benefited from heavy spending on political ads, but that was expected to slow down following Tuesday's elections.

On Wednesday, Time Warner also reported third-quarter profits that beat Wall Street expectations, with growth in its cable-access and cable-network businesses offsetting declines elsewhere.

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