Earnings: Time Warner’s Q2 Profit Slips; AOL Down 28 Percent, Time Inc. Plummets 53 Percent

Dragged down by advertising and subscription losses at *AOL* and Time Inc., Time Warner (NYSE: TWX) saw Q2 operating income two percent down year-on-year to $1.2 billion, on nine percent worse revenue of $6.8 billion…

AOL: Q2 revenue fell 24 percent year-on-year to $804 million, after the exodus of 2.3 million subscribers in a year knocked subscription revenue back by 27 percent (or $135 million) and advertising income fell 21 percent (or $111 million).

The ad falls came from lower display and paid search advertising on sites from the former Mediaglow, what AOL is now calling “AOL Media”, but also lower sales of adds on third-party sites (ie. the former “Platform-A”). In subscriptions, AOL lost 510,000 subscribers in the last three months alone; it’s abandoned its ISP business just about everywhere, but still has 5.8 million customers in the US. AOL also took a $15 million charge this quarter against its recent restructuring effort. AOL operating income is down 28 percent to $165 million.

Cutting AOL adrift from TW’s balance sheet continues to be a priority. TW CEO Jeff Bewkes, in the release, said the spin-off is “on track” for “around the end of the year”: “Separating AOL will benefit both companies