Media giant Time Warner posted a $16 billion loss, down from a $1.03 billion profit a year ago and its first loss in 14 quarters.
Wall Street was warned a month ago that the media conglomerate would take $24 billion in write-downs. About $15 billion of which reflect cable values. The rest addresses the weaker value of AOL and its magazine business. AOL just hasn't been able to turn its business around and make its new ad-supported business work. Revenue at the division fell 23 percent; ad revenue down 18 percent while its dial-up subscribership fell another 26 percent. At Time Inc., the publishing division, earnings dropped 70 percent on 13 percent lower revenue.
Warner Bros has had a stellar year, with top market share in 2008 and so far this year as well: the division yielded 6 percent earnings growth, despite 11 percent revenue decline. In contrast, Time Warner's cable TV business showed nearly 9 percent revenue growth but a 20 percent earnings decline. Earnings would have shown 11 percent growth, were it not for a charge due to a legal settlement related to Turner's winter sports teams.
Time Warner Cable , awaiting its full spin-off from TWX, showed 8 percent revenue growth, but it's also suffered from the economic downturn, swinging to a net loss of $8.2 billion. The company is attracting fewer new subscribers as fewer people move into new homes and sign up for new, higher-end services. The number of total subscribers fell 1.1. percent from the third quarter to the fourth quarter, while the number of subscribers who have at least two of their services (phone, cable TV, and Internet) dropped 1.2 percent.
Now all eyes on News Corp's earnings after the bell Thursday.
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