Revenue and Profit Declines at Time Warner

New York Times -

Nov-05-2009

Revenue and Profit Declines at Time Warner

(topic overview)
CONTENTS:

The world's largest entertainment house Time Warner Inc.' s earnings fell by 38% in third quarter. (More...)
Principally due to lower search and advertising revenue, News Corp.' s Digital Media Group saw its earnings decrease by $22 million year-over-year, the company said during its fiscal first quarter earnings call Wednesday. (More...)
Profit rose modestly in the company's TV networks and film units, but earnings were halved at AOL and Time Inc. (More...)
Third-quarter net income fell to $661 million, or 55 cents a share, from $1.07 billion, or 89 cents a share, a year before. (More...)
The ax finally dropped at Time Inc. the company started its layoffs on Wednesday as it aims to reduce costs by $100 million across the publishing division. (More...)
The content group alone is expected to have adjusted EPS for the year of $1.75. (More...)
At filmed entertainment, led by Warner Bros., revenue fell 4% to $2.8 billion on softness in the homevideo market. (More...)
The results indicate that advertising at the company's cable nets is beginning to recover, and that cost-cutting at Warner Bros. is paying off, Reuters writes ( via The New York Times). (More...)
Chairman and Chief Executive Officer Jeff Bewkes said: "We still expect to spin off AOL by the end of the year, and we'''''''''''''(TM)re making great progress on our other longer-term strategic priorities. (More...)
As expected, Time Inc. announced that it plans to cut another $100 million from costs; the reduction is expected to come mainly from layoffs. (More...)
All in all, I would give you a summary on television that says we think we can continue to grow it and continue to produce fairly consistent earnings and cash flow. (More...)
How To Create A Successful Low-Cost Video Network On YouTube's most-viewed channel list you'll find the how-to video network ExpertVillage in second place for all time with 812 million views. (More...)
We also continue to expect very strong results in the upcoming fourth quarter as our successful summer films, Harry Potter and The Hangover will be released on home video. (More...)
I hope everybody kind of checks it and realizes that the number is substantiated, that you can't have which is why our competition doesn't have the kind of consistency and the high level of earnings unless you can do both, and so the most recent examples are Mentalist and Southland, huge hits from Warner's onto the broadcast networks and award critically acclaimed. (More...)

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The world's largest entertainment house Time Warner Inc.' s earnings fell by 38% in third quarter. Despite losses via AOL, which the firm plans to make a separate, publicly traded company by end of this year, the media giant topped analysts' expectations and raised its full-year earnings target to at least $2.05 a share, compared with a view initially of about $1.98. The increased forecast of the company includes as much as $100 million in restructuring costs at Time Inc., where 600 workers lost their jobs last November. Despite the fact of facing the drop in revenue from its movie studio and the HBO and Turner cable networks in July-September quarter, bringing down to 55 cents per share with the view of 89 cents per share, a year ago. [1] Jeff Bewkes is eagerly looking forward to the day when Time Warner's fortunes will turn on content alone. In its third-quarter earnings, Time Warner profit fell 38% last quarter to $661 million, dragged lower by steep declines at AOL and continued softness at beleaguered Time Inc. Revenue dipped 6% to $7.1 billion. The cable networks and filmed entertainment were both profitable, and the overall numbers handily beat Wall Street's expectations and prompted the media conglom to boost its full-year earnings forecast. It now expects earnings of $2.05 per share vs. a previous estimate of about $1.98. Time Warner chairman-CEO Bewkes reiterated Time Warner's intention of spinning off AOL by year's end and emphasized how much better off the two companies will be once they go their separate ways.[2]

NEW YORK (CNNMoney.com) -- Time Warner Inc. said Wednesday that its business outlook has improved, after the company posted quarterly profit and sales that fell from year-ago results but beat Wall Street's forecasts. The recession has cut into the company's media subscriptions and advertising sales, which are its primary revenue streams. Its television and film units outperformed expectations in the quarter, raising the company's hopes that it has turned a corner. "Time Warner is firmly on track to post solid results this year in spite of the tough economic environment," said Jeff Bewkes, Time Warner's CEO, on a conference call with investors. The media conglomerate raised its full-year guidance, saying it expects to earn $2.05 per share for 2009. That's better than the $1.98 per share estimate the company provided in April and is slightly higher than analysts' consensus expectation of $2.02 per share.[3]

Cost savings improved the bottom line: After adjusting for one-time charges, Time Warner earned 61 cents per share, much better than the 53 cents Wall Street had been looking for. That won't help employees at Time Warner's Time Inc. publishing unit: The company confirmed that it will make big cuts this quarter and spend up to $100 million on restructuring charges. This is different from the $100 million in cuts that had been previously reported, but it will still mean hundreds of layoffs at the publisher. Time Warner also boosted its guidance for the remainder of the year and confirmed once again that it wants to spin off AOL before the end of the year. As well it should: The company said it has already spent a staggering $24 million on the spinoff so far this year, which includes $9 million in "pretax direct transaction costs (e.g., legal and professional fees)." It has spent another $83 million in restructuring charges at that unit in 2009. As usual, Time Warner said ad sales have been lousy, but that its cable networks and film divisions had done okay.[4] The improved full-year outlook came despite what Time Warner said will be 100 million dollars in restructuring charges in the fourth quarter in the struggling publishing division. According to the New York Post, Time Inc., publisher of Time, Fortune, Sports Illustrated, People and other magazines, plans to lay off some 540 employees, or six percent of its workforce. Time Warner did not provide any details about the restructuring in its third-quarter earnings report. Time Warner chairman and chief executive Jeff Bewkes said the company "is firmly on track to post solid results this year in spite of the tough economic environment. "Driven by the better-than-expected performance at our Content Group this quarter, we're raising our 2009 business outlook," he said in a statement.[5]

"While advertising remains challenged, readers continue to value print publications and affiliated websites. This restructuring will allow us to most efficiently focus our resources on the creation of compelling content at our world class titles. Unfortunately, given the tough market conditions, this restructuring will mean a loss of jobs. As for its earnings, the publishing division saw revenues drop 18 percent to $914 million, thanks to a 22 percent decline in ad revenues and a 13 percent decrease in subscription revenues. Other revenues also saw a drop of 24 percent, which Time Warner chalked up to declines in the non-magazine business, including Southern Living At Home, which also caused the company decreases last quarter.[6] As for today's earnings report, Time Warner reported revenue of $7.1 billion, a 6 percent decline from the same period last year. (The company's profits fell off 38 percent from last year.) For the publishing unit, where at least 540 will lose their jobs before Thanksgiving, according to the New York Post's Keith Kelly, that meant an 18 percent decrease.[7]

On a conference call with analysts, the company said it will make most of the cuts at Time Inc.' s news group, which includes Time magazine, Sports Illustrated, Fortune and Money. Time Warner, which also owns the Warner Bros. movie studio and the HBO and Turner cable networks, said Wednesday its profit fell to $661 million, or 55 cents per share, in the July-September quarter, down from $1.1 billion, or 89 cents per share, a year ago.[8] Shares of Time Warner ( TWX, Fortune 500 ) fell 1% in premarket trading. Income falls on AOL, Time Inc: The New York-based parent company of CNNMoney.com and Fortune said its net income fell to $662 million, or 56 cents per share, down 38% from a year earlier.[3]

The ditching of AOL, combined with the recent spinoff of Time Warner Cable, will leave the conglom a much slimmer, pure content company. Considered on their own, the content businesses saw revenue dip by only 3%, the company said. TW estimated that the content biz alone would post earnings per share of $1.78 a share this year, from $1.42 last year. "This separation is an important milestone for both companies," said Bewkes during Wednesday's conference call.[2] Home video and interactive games revenue also declined, plus there were unfavorable currency impacts. Based on the better-than-expected quarterly figures, TW raised its estimate for 2009 adjusted profit per common share to at least $2.05 from $1.98. For its core content businesses, it expects an adjusted full-year profit of $1.75 per share, up from $1.42 in 2008. "Time Warner is firmly on track to post solid results this year in spite of the tough economic environment," said TW chairman and CEO Jeff Bewkes. Analysts and management lauded particularly the film unit's out-performance, with Bewkes predicting record film profits for the full year 2009 despite continued weakness in the DVD business.[9]

On a reported basis, including one-time items, quarterly earnings came in at 55 cents a share, sharply down by 38% from 89 cents posted in the year-ago quarter. On account of better-than-expected results at its Content Group -- comprising Networks, Filmed Entertainment, Publishing and Corporate segments -- Time Warner boosts its business outlook. The company now expects its full year 2009 earnings to be $2.05 per share, up from $1.98 previously anticipated.[10] New York - Media conglomerate Time Warner posted a 38-per- cent drop in third quarter profit Wednesday. However the earnings results beat analysts' estimates, and helped prompt the company to raise its earnings outlook for 2009 from 1.98 dollars per share to 2.05 dollars per share.[11] Time Warner said net profit fell to 661 million dollars, or 55 cents per share, in the third quarter from 1.1 billion dollars, or 89 cents per share, in the same quarter a year ago.[5] Time Warner's third quarter net income dropped more than 35 percent, to $661 million, or 55 cents per share, as compared to $1.07 billion, or 89 cents per share, in the same quarter last year.[12]

"AOL has a lot of scale, and some very successful consumer products inside the AOL experience," Bewkes said. Some of the core strengths that AOL will focus on include Web content, communications tools, and ad monetization, he said. Those three areas of focus are not new, as AOL has been working toward them for the past year or two -- especially since Tim Armstrong was named CEO in March and the spin-off from Time Warner was approved in May. AOL has been building out its content properties lately, and pursuing a local content initiative with its Patch.com network of local news sites that AOL acquired in June. AOL will also have the cash flow from its leftover subscriber business, which brought in $332 million during the third quarter.[13] Through the third quarter, our content group's adjusted OIBDA is up 2% despite an over $500 million drop in advertising revenue. As Jeff mentioned, this performance has allowed us to raise our full year outlook. From a structural standpoint, we're not only completed the separation of Time Warner Cable in March, but we're also on track to spin out AOL by the end of this year. As you might imagine it's been a very busy year and our strong free cash flow generation has left our balance sheet in terrific shape.[14] In what is likely to be its last full quarter as a unit of Time Warner, AOL reported an 18-percent year-over-year drop in advertising revenue, down to $415 million from $507 million in the third quarter of 2008. Ads on AOL's own sites, including both display and search ads, dropped 21 percent to $288 million, while revenue from third-party ads sold through its network dipped 12 percent to $127 million.[13] Authored by Mark Hefflinger on November 4, 2009 - 8:45am. New York - With its spinout from parent Time Warner (NYSE: TWX) likely less than two months away, AOL continues to struggle financially, according to figures released on Wednesday. For the third quarter, AOL saw its revenue drop 23% to $777 million, as subscription and ad revenue both fell by double digits.[15] Time Warner is in the process of spinning off AOL into a separate entity, a process expected to be completed soon. Within its publishing operations, which include Time Inc, owner of IPC Media, revenues dropped 18% to $914m, due to declines of 22% in ad revenue and 13% in subscription revenue. It did not specify IPC Media's profits or revenues. It did note that "the unfavourable impact of foreign exchange rates at IPC" did impact lower subscription revenues. Across Time Warner, encompassing AOL, its movie studios and publishing arms, revenues declined 6% from the third quarter of 2008 to $7.1bn.[16]

Media giant Time Warner Inc. (TWX) disclosed Wednesday that it's on track to spin off AOL as an independent entity, even as the Internet unit's finances continue to sour. While reporting third-quarter earnings, Time Warner said that the spin-off of AOL is still expected before the end of this year. It also said that a large part of its 6% decline in total revenue in the quarter was attributable to AOL, which saw subscriptions tumble while advertising sales declined sharply.[17] Revenue fell nearly 6 per cent to 7.1 billion dollars as the recession combined with the flight of customers to the internet to hit advertising sales. Time Warner confirmed that it still intended to spin off its own internet business AOL before the end of the year.[11] Time Warner's third-quarter net income fell 40% to $661m from $1bn a year earlier, partly due to lower ad sales at AOL and its magazines business. This was not as bad as analysts on Wall Street had been expecting. Chief executive Jeff Bewkes said the firm was "on track to post solid results this year in spite of the tough economic environment".[18] For the first time we've also provided an outlook for just our Content Group, adjusted earnings per share of at least $1.75. That's up around 25% on a reported basis versus last year and it's at least a mid-single digits increase, if you take out a big legal reserve we had at the end of last year. We provided guidance this way because we are confident that we will complete the AOL spin this year. This separation is an important milestone for both companies. It will enable both AOL and Time Warner to focus even more on our core business moving each of us toward our ultimate goal of improving our return on capital.[14] We have more of the top running franchises than anybody. In TV this year we'll mark the 18th time out of the past 23 years that we've been the top producer of broadcast network programming and all this without owning a major broadcast network. Sometimes this track record is overlooked because there's a perception that film is inherently the lower term or volatile business. That's certainly not true and hasn't been true for Warner Brothers. I can tell you that Warner Brothers' return is well above its costs in capital, excluding the asset write-off sides of the AOL Time Warner merger. Just as a glimpse, Warner's level of profit consistently surpasses its peers by far. This year will mark the ninth straight year it has generated in excess of $1 billion in annual adjusted OIBDA with a very high cash flow from. In fact despite the softness in home video overall this year, Warner's on pace to report its highest profits ever this year.[14]

Profit at the division rose 6% to $291 million as the studio slashed overhead and print and advertising costs. The studio took an $85 million restructuring charge this year as it slimmed down, shifted lines of command and streamlined its operations. "Despite softness in the video market, Warner delivered its highest profits ever," Bewkes said. He's upbeat on upcoming pics "Sherlock Homes," with Robert Downey Jr., and Clint Eastwood's "Invictus" with Matt Damon. At magazine publisher Time Inc., profits plunged 40% to $97 million as the company announced the unit would take a $100 million restructuring charge this quarter.[2] Time Warner's AOL and Time Inc. divisions continue to eat into its bottom line, as the media conglomerate posted third-quarter net income of $661 million, or 55 cents a share, a 38 percent decline versus its year-ago profit of $1.07 billion, or 89 cents a share.[19] NEW YORK — U.S. media and entertainment giant Time Warner posted a 38 percent decline in quarterly net profit on Wednesday, dragged down by weak results in its publishing division and at Internet unit AOL.[5] NEW YORK — Media conglomerate Time Warner Inc. reported a 38 percent drop in third-quarter profit, hurt by declines at its AOL and publishing segments. The results beat expectations and the company boosted its full-year earnings forecast.[8]

NEW YORK -- Time Warner's third-quarter profit fell 38%, but exceeded Wall Street expectations, leading the media giant to raise its full-year profit forecast. TW on Wednesday reported stronger profitability in its TV networks and film units, while the magazine division and AOL, which is expected to be spun off in early December, were weaker.[9] NEW YORK (Reuters) - Time Warner Inc posted a higher-than-expected quarterly profit and raised its full-year earnings forecast, in a sign that advertising sales at cable networks such as TNT are recovering and that cost-cutting at the Warner Bros film studio is paying off.[20]

Satisfying the future outlook, the movie studio and cable channels relying on ad dollars accomplished recovered results, further, chasing the mount of 5 percent revenue from Network Segment. For the moment, the group saw a decline in earnings and in sales, though, Time Warner constantly articulated its assurance to the business.[1] Everything else we have. On your AOL question, basically AOL has a lot of scale and they've got some very successful consumer products inside the AOL experience. Essentially the new management has identified several opportunities where AOL has competitive advantages, and they're going to do a road show in the next couple of weeks which I think will provide everybody a lot more insight than I should give on this call. Essentially they're focusing on core strengths in Web content, communications, and ad monetization, and the key areas are to expand their content properties, some of which really do have a lead position against all the competitors to pursue local content initiatives and mapping opportunities. They've got some fairly lead share communication offerings that they want to enhance. As you know, they have a very strong and leading third party network for ad sales, which admittedly there are a lot of competitors in that now. That's a significant platform on which to build. If you take that and add to it the cash flow from the subscription business and some of the fairly advantaged user habits that the subscribers to AOL have in terms of traffic use and monetization, they've got those building blocks on which to compete in the new company. The only thing I would add, I think the first part of your question asked about our commitment to continuing to spit it out now, we remain fully committed to complete the spin because it's our firm view that AOL is going to be better off being on a separate footing as opposed to be being part of Time Warner.[14] Looking ahead, Time Warner said it expects full-year adjusted earnings of at least $2.05 a share, up from $1.98 a share in 2008 and better than the $2.02-a-share consensus target. In anticipation of its separation of AOL, which is expected to be completed in December, Time Warner provided a full-year outlook for its content group, which consists of the networks, filmed entertainment, publishing and corporate segments.[21]

Time Warner has reported its earnings for the third quarter of 2009 and the news isn't so pretty for AOL. Overall revenues declined 23% to $777 million.[22] Time Warner's total revenues, including its TV, filmed entertainment, publishing and AOL divisions, fell 6% in the third quarter of 2009 compared to the same period in 2008, declining from $7.58 billion to $7.13 billion.[23] Revenue was down 6 percent, to $7.1 billion, reflecting lower revenue at Warner Brothers and Time publishing, even as revenue rose at the Turner Broadcasting and HBO units. Time Warner said its spinoff of internet unit AOL will be completed by the end of the year.[12] Film studio Warner Bros, magazine publisher Time Inc and internet unit AOL all reported a fall in revenue. In May this year, Time Warner said it would spin off AOL as a separate company.[18] The AOL spin off will follow other recent moves at Time Warner to focus on the company's core businesses. Earlier this year, the company completed a spinoff of its cable service provider Time Warner Cable ( TWC ), and the company began to reorganize Time Inc. in late 2008, laying off 600 and stopping publication of a handful of magazines in the process.[3]

Time Warner's own cable networks -- including CNN, TNT and Home Box Office -- reported strong growth in the third quarter, but couldn't overcome declines at the media giant's AOL, publishing and filmed entertainment units.[24] Media and entertainment giant Time Warner Inc. ( ]] ) on Wednesday posted a 38% lower third quarter profit, dragged down by sagging performance in its AOL and publishing units.[25]

Media conglomerate Time Warner ( TWX - news - people ) Inc. reported a 38 percent drop in third-quarter profit after being hurt by declines at its AOL and publishing segments.[26]

One reason: more than half of Time Warner's 6 percent revenue decline for Q3 is the result of the continued access subscription declines at AOL ( NYSE: TWX ). Bewkes called the planned spinoff, still expected by the end of the year despite the lack of regulatory approval so far, "an important milestone for both companies." Another reason: AOL has gone about as far as it can go for now.[27] What does that say, then, for Time Warner's AOL unit'''part of the Internet, more or less'''which did even worse with a 23 percent revenue decline? As Silicon Alley Insider's Jay Yarow's caveman-like headline put it: Time Warner Okay, AOL Awful. (Well, soon enough AOL won't be Time Warner's problem anymore, so there.) Deftly reading the CEO's mind, Friedman writes, "Likely, Bewkes' head tells him the time is here to find a way to unload the magazine division.[7]

Revenue at Time Warner's networks division, which includes television channels CNN, Turner Broadcasting and HBO, rose five percent to 2.9 billion dollars. Revenue fell four percent to 2.8 billion dollars at the film division as third-quarter releases such as "Harry Potter and the Half-Blood Prince" failed to enjoy the same success as last year's hit Batman film "The Dark Knight."[5] Overall, Time Warner reported a 6 percent decline in revenue, to $7.1 billion, while operating income fell 10 percent, to $1.4 billion.[28] Total revenue at Time Warner was down 6% to $7.1 billion in the quarter, and adjusted operating income before depreciation and amortization fell 9% $1.8 billion.[24]

On average, analysts expected Time Warner to record a profit of 53 cents a share on revenue of $7.07 billion, according to a poll by Thomson Reuters.[21] Time Warner said it earned $661 million, or 55 cents a share, for the quarter ended Sept. 30, down from a year-ago profit of $1.07 billion, or 89 cents a share.[21]

Adjusted to account for one-time items in the quarter, Time Warner said it earned 61 cents a share in the quarter. That's down from and adjusted profit of 65 cents a share in the year-ago quarter.[21]

The surprising results -- earnings per share beat analyst forecasts by about 15 percent -- come during a major repositioning at Time Warner, which has spun off Time Warner Cable Inc and will spin off Internet operation AOL in December.[20] Revenue declined six percent to 7.1 billion dollars. Time Warner nevertheless raised its outlook for full-year earnings saying it expected earnings per share of at least 2.05 dollars, up from the 1.98 dollars forecast previously.[5] Revenue fell 6 percent to $7.1 billion, in line with analysts' estimates. The company expects adjusted earnings of at least $2.05 per share for the year, up from its earlier forecast of $1.98.[8] On average, Wall Street analysts expected a lower profit of 53 cents per share, on matching revenue of $7.1 billion. Looking ahead, the company boosted its full-year earnings forecast to at least $2.05 per share, up from prior guidance for $1.98 per share.[25]

The New York-based company reported third quarter net income of $661 million, or 55 cents per share, compared with $1.1 billion, or 89 cents per share, in the year-ago period.[25]

Though the number of total staffers to be laid off wasn't confirmed by the company, reports put the number at between 400 and 550. This round follows Time Inc.' s paring of 600 employees last fall and some 250 staff cuts in early 2007. During its third quarter, Time Inc. reported an 18 percent dip in revenues, to $914 million, with a 22 percent decline in advertising revenue and a 13 percent drop in subscription sales.[28] Subscription revenue growth reflected the consolidation of HBO Latin America had higher affiliate fees at each of Turner and HBO. Unfavorable FX remained a drag in the quarter. The decline in content revenues this quarter was largely a result of lower ancillary sales of HBO's original programming. Last year included the sale of the final season of the Sopranos into syndication and this revenue decline was offset in part by the effective lower than anticipated home video returns of roughly $25 million.[14] Content revenue fell by 12%, or $27 million, on lower sales of HBO original programming. This time last year, Bewkes said, HBO was selling the DVD set for the final season of "The Sopranos."[2]

Chief Executive Officer Jeff Bewkes wants to concentrate on one big business: creating content. He has also taken a hard line on costs, a strategy that is underpinning results and cheering investors, who have driven the stock up by about a third in the last six months. Bewkes said 2009 earnings from the combination of Turner Broadcasting, Time Inc, and Warner Bros -- its content businesses -- would surpass those of last year by about 23 percent. He also raised the company's full-year outlook.[20] Last year's earnings included results from Time Warner's spun-off cable unit, Time Warner Cable Inc. Earnings from continuing operations fell a more modest 14 percent.[8]

Last year's third quarter included results from Time Warner Cable (TWC), which had not yet been spun off.[12] Though Time Warner posted a drop in profit, its third quarter results were higher than expected and the company raised its full-year earnings forecast.[29]

Paid search revenue from AOL's deal with Google dropped by 24 percent during the third quarter, primarily due to lower query volume and lower clickthrough rates on the AOL client, according to Time Warner CFO John Martin.[13] Time Warner said the decline in ad revenues was due to lower paid search and display ads on AOL Media, reduced ad sales on third party sites and foreign exchange rates.[22] Unveiling its Q3 financials, Time Warner said AOL's revenue drop was caused by a 29% decline in subscription revenue and an 18% decrease in ad revenue.[16]

Even growth in Time Warner's network segment was hampered by declining ad revenues -- the prevailing problem across all of the media.[6]

Time Warner (TWX) this morning reported Q3 revenue of $7.1 billion, down 6% from a year ago, and about in line with Street expectations.[30] In addition to higher revenues, adjusted OIBDA of $1.1 billion benefited from lower marketing and news gathering costs and the consolidation of HBO Latin America. As expected, year-over-year margin expansion was more modest this quarter as compared to what we experienced in the first half of the year, and that was a result of higher programming expenses at Turner, which reflected the timing of our original programming launches in the summer. That was planned for. Other cost declines offset the higher programming expenses and through the third quarter our networks adjusted OIBDA is up 11% with 200 basis points of margin expansion.[14] Cost per click at certain properties continue to be adversely affected by algorithmic changes made by Google. The biggest sequential improvement came from our third party network where year-over-year revenue declines improved substantially relative to the second quarter of this year and that was due to higher demand from brand advertisers.[14]

The company's filmed entertainment segment, which includes film studio Warner Bros., posted sales that fell 4% in the quarter. That decline was mostly due to a difficult comparison to the same period last year, which brought in hefty revenue from the blockbuster "The Dark Knight."[3] Revenue was impacted by tough comparisons to last year's theatrical standout The Dark Knight. "One of the reasons why we are having such a great year, under the backdrop of a tough home entertainment environment, is that we've done a phenomenal job in cutting costs in home entertainment," John Martin, Time Warner executive VP/chief financial officer, said on a Wednesday conference call with analysts.[31]

Overall, the Time Warner company recorded $661 million in net income, a 38% drop from last year.[31] The outlook excludes the effects of a $100 million restructuring at publishing unit Time Inc., which the company expects to incur in the current quarter. Time Warner confirmed that the cost-cutting would come in the form of layoffs at Time Inc. during this quarter, but the company didn't disclose the number or timing of those job cuts.[3] Shares rose 61 cents, or 2 percent, to $30.77 in morning trading Wednesday. The company confirmed that it will cut jobs at its magazine unit, Time Inc., though it would not offer details on the extent or timing of the cutbacks. It expects to take about $100 million in restructuring charges this quarter.[8]

We now expect adjusted earnings per share of at least $2.05. This even includes as much as $100 million or about $0.05 per share in new restructuring charges at Time Inc. that we announced today.[14] Time Warner now says adjusted earnings per share should be at least $2.05, compared with the $1.98 per share it was previously predicting.[29] Without the charge, Time Warner said it earned 61 cents per share. Analysts polled by Thomson Reuters, who typically exclude one-time items from their estimates, forecasted earnings of 53 cents per share.[3]

Media giant Time Warner (NYSE: TWX ) reported third-quarter earnings this morning and issued a stronger outlook. During the quarter, earnings dropped 38%, thanks to declines at its AOL division (parent of BloggingStocks) and publishing segments.[32] Time Warner shares rose slightly after the report, which showed AOL and the Time Inc magazine division as the main drags during the quarter.[20] On AOL India, the company has denied Time Warner would be keeping it; it will, as planned, go with AOL's spinoff. This is what was in the filing: "TWX may determine not to have AOL LLC transfer its shares in AOL Online India Private Limited (the '''AOL Online Shares''') in the Asset Distribution."[33]

I'''''''''''''(TM)m confident that the new content-focused Time Warner will be well positioned to deliver steady and attractive stockholder returns in 2010 and beyond." "In anticipation of the Company'''''''''''''(TM)s separation of AOL, which is expected to be completed in December 2009, Time Warner is also providing a full-year outlook for its Content Group (which consists of the Networks, Filmed Entertainment, Publishing and Corporate segments).[34] Explore new technologies that are driving the future of the publishing business. Fill out the following information and click on the Send button in order to send this post, Time Warner Earnings: Growth From Networks Can't Offset Publishing Declines, to a friend.[6]

We've cut marketing, but that hasn't impacted our sell-through units." Time Warner CEO Jeff Bewkes spoke about the home entertainment business steadying itself, after serious declines earlier this year.[31] Time Warner is still on track to complete the spin-off of AOL before the end of the year, Time Warner CEO Jeff Bewkes said.[13] "We still expect to spin off AOL by the end of the year, and we're making great progress on our other longer-term strategic priorities," Bewkes said. "I'm confident that the new content-focused Time Warner will be well positioned to deliver steady and attractive stockholder returns in 2010 and beyond," he said.[5] In the release, Time Warner chairman and CEO Jeffrey L. Bewkes said, "We still expect to spin off AOL by the end of the year, and we'''re making great progress on our other longer-term strategic priorities."[7]

"I think the home entertainment environment is stabilizing and will continue to next year," Time Warner chairman and CEO Jeffrey Bewkes said in a call with analysts.[35] Time Warner chairman and CEO Jeff Bewkes said that distributors looking to get tough on retransmission-consent demands from broadcasters and higher affiliate fees from cable networks will likely focus on niche networks, rather than established channels. On a conference call with analysts to discuss third-quarter results, Bewkes said that he is not worried about the changing dynamic, as some networks like Fox, CBS and ABC are beginning to ask for retrans cash outside of station groups.[24] Bewkes Asks Analysts To Imagine Time Warner Without AOL. Pretty Please. It's not quite the first day of the rest of their livesthat will come when the split is officialbut Time Warner CEO Jeff Bewkes wants analysts and investors to start looking at AOL and Time Warner as two different companies, even breaking out the results as though AOL is already separate.[27]

Time Warner CEO Jeff Bewkes kicked off his quarterly earnings call by explaining why the company is cutting hundreds of jobs in its Time Inc. magazine unit.[36] The magazine, a custom publication produced with American Express, had 11 employees who have been laid-off. The New York Times Media Decoder blog has also reported that Time Inc. filed a letter with the New York State Department of Labor declaring its intention to eliminate 280 jobs between November 2 and January 31, 2010. In a memo to staff (posted by Gawker ) Bewkes wrote (with just a little understatement), "These are challenging but exciting times for Time Warner." He continued, "As a content-focused company, I believe that we'll be better able than ever to take full advantage of the opportunities offered by new technologies.[7] Word broke via Stephanie Clifford on the New York Times' Media Decoder blog that the promised layoffs coming to Time Warner's publishing unit, Time Inc., had begun with cuts at Sports Illustrated.[7]

During Time Warner Inc.' s third-quarter conference call Wednesday, chief executive officer Jeff Bewkes said Time Inc.' s news division, which includes Time, Fortune, Money and Sports Illustrated, would incur most of the cost cuts.[28]

Some are wondering what else might be spun off'''specifically, the publishing unit, which has been rumored to be in play for years. A spinoff was pooh-poohed by Bewkes as recently as early October at The Atlantic's First Draft of History conference, but some still see a magazine sell-off as an option for the larger company. "Will Time Warner scrap Time Inc.?" asked MarketWatch's Jon Friedman this morning.[7] The company is expected meet with the remaining staff members on Wednesday, with total job cuts reaching about 500, according to the source. Time Warner also said it still plans to spin off its AOL unit by the end of the year.[3]

London - AOL's global revenues plunged 23% in Q3 to $777m, parent Time Warner said today.[16] NEW YORK ( TheStreet ) -- Time Warner ( TWX Quote ) reported better-than-expected third-quarter earnings and revenue and offered upside guidance for its full-year profit.[21] U.S. media firm Time Warner has raised its full-year profit forecast after an improved performance at its film and cable network units.[18] WE ARE UPGRADING Time Warner (ticker: TWX) to Outperform from Neutral with a $37 price target based on our detailed analysis of the cable networks and filmed entertainment units as well as key 2010 swing factors such as foreign exchange and restructuring charges.[37]

At filmed entertainment, revenue fell 3.5% and AOIBDA rose slightly (1%) to $385 million, while the publishing unit saw an 18.25% revenue dip to $914 million and a 42.3% plunge in AOIBDA to $139 million. Those declines were too much for the cable networks to erase.[24] Total revenue for the quarter tumbled 6% to $7,135 million due to a fall in revenue at the AOL, Publishing and Filmed Entertainment segments, partially offset by growth in the Networks segment.[10] Revenue slid nearly 6% from a year ago to $7.13 billion, as lower revenue at the AOL, publishing and filmed entertainment segments more than offset growth at the networks segment.[21]

Revenue fell 6% to $7.1 billion. Its adjusted profit of $0.61 a share fell just a few pennies short of last year's $0.65 a share showing.[38] We ended the third quarter with $10.4 billion in net debt and that's about flat with the second quarter. That's because our free cash flow that I just discussed a little earlier was offset by our ongoing dividend, our share repurchase program and the repurchased of Google's 5% stake in AOL. And as I noted earlier, we are committed to maintaining a strong balance sheet while both fully investing in our businesses and increasing direct returns to shareholders. Our strong free cash flow through September has allowed us to accomplish each of these goals. We've invested more in our businesses this year than last year, and as of today, we have returned around $1.6 billion to shareholders this year. This includes both the dividend and nearly $1 billion in share repurchases.[14] Our leverage ratio was below two times despite increasing investment in our businesses and providing a higher direct return to shareholders. We're currently on track to return about $2 billion this year through both dividends and share repurchases.[14]

Our TV production business has also had a great year with 12 new shows ordered by the networks and 14 returning shows. That makes us the leading provider of broadcast TV programming this season. Two and a Half Men and Big Bang Theory are now in the top two comedies on the networks' schedules and in light of the scarcity of comedies they are two of the most valuable shows on television. These results aren't just grid-lock. This year will mark the eighth time in the last nine years that our studios have led the domestic box office. We've had the number one share of the home video business every one of those nine years and, worldwide, we've produced 8 of the top 15 grossing films ever, while no other studio has produced more than two.[14] In spite of the advertising climate and difficult comparisons in film and networks versus last year's high performance, adjusted OIBDA for our content groups held flat in the quarter and is now about 2% year-to-date. This strong performance was broad-based, coming from HBO, Turner and Warner Brothers. As you saw this morning in our business outlook these results gave us the confidence to raise our full-year outlook for 2009.[14] We expect content group adjusted EPS to be at least $1.75. that also includes the fourth quarter charge and that's off a base of $1.42 last year. That's up around 25% or at least mid single digits when you exclude 2008's legal reserve. This outlook obviously implies a significant increase in fourth quarter adjusted EPS relative to a year ago, but please recall that last year's fourth quarter it includes both the $271 million legal reserve, as well as $160 million of restructuring charges at publishing.[14] The studio also reported lower-than-anticipated home video returns from retailers of about $25 million. It has generated $85 million in restructuring charges this year compared to $130 million in 2008 with the shuttering of New Line Cinema. "Going into this quarter, we fully expected our adjusted to be down year-over-year," said CFO John Martin[35] Expenses also continue to run favorable to a year ago. Excluding restructuring charges of $85 million this year and $130 million in 2008, margins have expanded by over 150 basis points year-over-year through the third quarter at our film division.[14]

Moving over to publishing. Difficult advertising conditions continue with this division with ad revenues down 22% in the third quarter. That was an improvement, however, versus earlier quarters in the year and we expect that the fourth quarter will show even more improvement.[14] Please recall that our domestic news ad revenue was up 19% in the third quarter of last year.[14]

Ad revenue at the internet division fell 18% for the quarter. AOL is moving to offer more of its own news and information content, but the strategy has yet to pay off.[29]

Ad revenues eased 1%, by about $4 million, pulled lower in part, the company said, by declines at the news networks.[2] Ad revenue for the company's cable nets, including CNN, TBS and HBO, slipped just 1%, up from the 3% decline seen in Q2. Ad results were hurt by its news networks, including CNN, which has been seeing ratings declines, according to the Wall Street Journal.[29]

Principally due to lower search and advertising revenue, News Corp.' s Digital Media Group saw its earnings decrease by $22 million year-over-year, the company said during its fiscal first quarter earnings call Wednesday. [23] Revenue from company's web media unit AOL slipped 23% to $777 million due to a 29% drop in subscription revenue, resulting from sustained subscriber losses and an 18% fall in advertising revenue. The media giant remains on track to spin off its struggling AOL unit by December 2009.[10]

AOL posted an 18- per-cent cut in revenue, as ad sales dropped 23 per cent. The company's magazine division also saw an 18-per-cent sales drop, as both advertising and subscription levels plummeted.[11] Sales at AOL, which the company has been planning to spin off since May, fell 23% on an 18% decline in online ad revenue.[3] The decline in AOL's ad revenue was due primarily to lower paid-search and display advertising, reduced sales of advertising on third-party internet sites and the unfavourable impact of foreign exchange rates.[16]

Revenue at Time Warner's publishing operations dropped 18 percent as advertising sales continued to suffer.[8] Time Warner's results come a day after rival Viacom ( VIA ) reported profit jumped 15%, even as advertising sales slumped.[3]

Time Warner's Time Inc., the largest magazine publisher in the U.S. and one of the leading publishers in the U.K. and Mexico, saw ad sales fall 22% in Q3, up from the 26% decline in Q2 and the 30% drop in Q1.[29] Time Warner CFO John Martin said between the paid search declines, the ad environment and the current structure, AOL faces margin and earnings pressure "for some time." It's hard to see how anything less than a radical overhaul will change the picture for AOL on its own. Better for AOL, too : But AOL will start life on its own debt-free. Asked during Q&A about the prospects for the spinoff, Martin said, "We remain fully committed to complete the spin because it's our firm view AOL is going to be better off on its own."[27] Time Warner (NYSE: TWX ) had a better third quarter than Wall Street was expecting, and also raised its full-year earnings guidance today.[12] Sinclair Broadcast Group witnessed lower revenues in the third quarter -- with expectations that the fourth quarter will see a similar decline. ABC Spells 'V' For Ratings Victory 7 hours ago ABC took a big V-swing out of CBS' strong Tuesday lineup with its new "V" limited sci-fi series, earning a massive 5.0 in prelim Nielsen results.[23] Subscription revenues continued to decline as AOL lost 438,000 subscribers in the third quarter. That's the lowest quarterly subscriber loss since the start of the transition to a free service back in 2006. Margins declined both year-over-year and sequentially as continued cost declines were not sufficient to offset revenue declines. AOL is currently weighing some additional restructuring plans but pending those steps it will be challenging to materially reduce its fixed cost base much further.[14] Year-to-date, AOL has incurred $83 million of restructuring costs and that includes $10 million in the third quarter.[14]

Navigational device maker Garmin Ltd. ( GRMN - news - people ) reported a 24 percent increase in third-quarter profit as lower costs offset a drop in sales. Shares of Blackboard Inc. ( BBBB - news - people ) jumped to a 14-month high a day after the educational software developer said its third-quarter profit rose nearly quintupled. Television broadcasting company Sinclair Broadcast Group ( SBGI - news - people ) Inc. said its third-quarter profit increased 47 percent, helped by lower taxes and expenses. Vitacost.com Inc., an online retailer of nutritional supplements and health and wellness products, said it took a larger loss in the third quarter due to costs connected to its initial public offering in September.[26] The company, which reported a profit in the third quarter, also posted strong October sales versus the previous month.[23]

Profit rose modestly in the company's TV networks and film units, but earnings were halved at AOL and Time Inc. [3] Adjusted OIBDA declines at AOL and Time Inc. negated moderate growth at the company's television networks and film units.[3]

Adjusted operating income before depreciation and amortization OIBDA dipped by 9% to $1,804 million due to declines at the AOL and Publishing segments, partially offset by growth at the Networks and Filmed Entertainment segments.[10] The company's Q3 profit fell 38%, to $661 million, on declines at AOL and the company's publishing segments, but results beat expectations.[29] The AOL unit saw the biggest declines -- revenue was down 23.2% to $777 million and AOIBDA fell 40% to $239 million in the period.[24] AOL in the quarter posted revenue of $777 million, down 23% year over year; adjusted OIBDA was down 40% versus a year ago, and operating income was down 50%.[30] Overall revenues for AOL, which include $332 million in subscription fees, were down 23 percent over the same period last year, to $777 million.[13]

Note that more than half of the total revenue decline was a result of the continued drop in AOL subscription revenue and the negative impact of FX. Advertising revenue declines actually improved somewhat sequentially and our content group revenues were down only 3%, that's the smallest decline so far this year.[14] Networks revenue jumped 5% to $2,874 million driven by 9% growth in subscription revenue, partly offset by a 12% fall in content revenue and 1% decline in advertising revenue.[10] Publishing revenue dipped 18% to $914 million following a 22% fall in advertising revenue, 13% decline in subscription revenue and 24% drop in non-magazine revenue.[10]

Even with meaningful additional restructurings, however, we expect AOL will face margin and earnings pressure for some time in light of projected declines and high margin subscription and search revenue.[14] We expect advertising revenue to decline in the fourth quarter and that will be due to the lower upfront pricing even more difficult comparisons at our CNN division against lat year's U.S. presidential election and to a much lesser degree recent entertainment ratings trends.[14] Advertising revenues were almost flat to the year ago quarter. Domestic entertainment networks posted another quarter of low single-digit growth but this was more than offset by continued softness at our international networks including the impact of unfavorable FX and the difficult comparisons at our domestic news operations.[14]

Kraft Foods Inc.' s Q3 '09 net revenues declined 5.7%, to $9.8 billion, as a result of unfavorable currency effects and divestitures. For the same reasons, the company lowered its organic net revenue growth projection for the full year from 3% to 2%.[23] Adjusted OIBDA of $1.8 billion was down 9% from a year ago. CEO Jeff Bewkes said in a statement that the company "is firmly on track to post solid results this year in spite of the tough economic environment."[30] The losses were moderated by a stronger performance in the television and film businesses, which handily beat expectations and raised hopes that the company had turned a corner. "Time Warner is firmly on track to post solid results this year in spite of the tough economic environment," said chief executive Jeff Bewkes in a statement.[11]

Sanford C. Bernstein analyst Michael Nathanson looked ahead and warned: "In 2010, we remain concerned about the film studio (operating cash flow) given that there is no Harry Potter DVD and no action tentpole in summer 2010." On his earnings conference call, Bewkes lauded his film unit and its management team. "Warners is having another fantastic year," he said. Despite fewer releases, it is still on track to meet or exceed last year's U.S. boxoffice of $1.9 billion, he added.[9] Bewkes raised the outlook for the company's earnings for the year, to $2.05 a share from $1.98 previously.[28] The company expects 2009 full-year content group adjusted earnings to be at least $1.75 a share, compared to content group adjusted earnings of $1.42 a share in 2008. -- Written by Robert Holmes in New York.[21] Looking ahead, TWX forecast adjusted earnings of at least $2.05 per share. This forecast is higher than the $1.98 per share the company issued earlier and the $2.02 per share that the Street expects.[32] The company said it is now looking for full-year earnings of $2.05 per share, as compared to previous predictions of flat annual earnings per share.[12]

Our goal is to consistently produce earnings per share growth that exceeds our operating income growth, which should in turn exceed our revenue growth. That will require both strong operating performance and careful stewardship of the balance sheet.[14] Adjusted earnings totaled 61 cents per share, better than analysts had anticipated.[12] The group beats the analyst prediction of 53 cents earnings a share nevertheless attains 61 cents per share.[1]

Excluding items, TWX's earnings checked in at 61 cents per share, topping the consensus estimate by 8 cents per share.[32]

Third-quarter net income fell to $661 million, or 55 cents a share, from $1.07 billion, or 89 cents a share, a year before. [20] The owner of Warner Bros film studio, CNN, the HBO cable channels and magazines like Fortune and People said it earned 661 million dollars, or 55 cents a share, compared to net income of 1.1 billion dollars, or 89 cents a share, in the year-earlier period.[11]

Time Warner sees adjusted EPS for 2009 of at least $2.05 a share, above the Street at $2.03.[30] Time Warner shares were up 2.39 percent at 30.88 dollars in early trading in New York.[5] FILE - In this Nov. 7, 2007 file photo, people walk by the Time Warner building in New York.[8]

"I'm confident that the new content-focused Time Warner will be well positioned to deliver steady and attractive stockholder returns in 2010 and beyond," Bewkes added.[3]

Time Warner execs said AOL had slashed to the bone, so there's not much room to maneuver on the cost front. The sooner Time Warner can stick AOL's results in its "discontinued operations" folder, the better.[2] However the 2008 results included Time Warner's cable unit, which was spun off into a separate company in March.[11] Time Warner's online arm is in a funk at the media giant, joined by the company's languishing publishing business.[38] As we sorta expected, executives at the Time Warner's publishing unit moved late Tuesday to begin the process of doling out hundreds of pink slips in advance of Wednesday's earnings call.[39] All eyes were on Time Warner this morning as the company released its third-quarter earnings.[7] Time Warner's earnings announcement is expected before the stock market opens on Wednesday, and an earnings call with investors is scheduled for 10:30 a.m. I'm told staffers will be meeting with executives before the earnings call.[39] PHYSICAL: Time Warner was upbeat about its third-quarter 2009 earnings, noting improved studio performance plus stabilization of the overall DVD market.[31]

Coming into the year we had several goals that we wanted to accomplish in the face of a difficult economic environment. To deliver strong relative financial performance by focusing on our operations, second to complete the spin of Time Warner Cable and third to maintain a strong balance sheet while both investing fully in our businesses and increasing returns to shareholders. With only two months to go in the year we are on track to deliver on or exceed each of these goals.[14] There might be some confusion in the market about some joint investments that spinoff Time Warner Cable ( NYSE: TWC ) held along with Time Warner, but not related to AOL.[33] Time Warner is in the midst of a massive repositioning, having recently spun off Time Warner Cable and being in the process of spinning off AOL.[29]

Some could even be spun off for a quick return of a portion of the purchase price. Microsoft has not been the.com darling, they have literally thrown Billions of dollars at the internet with not much to show for it. AOL will always be tainted concerning its failed merger with Time Warner.[40] Last week I reported, based on AOL's spinoff SEC filing, that Time Warner ( NYSE: TWX ) may be retaining AOL India and AOL's venture investments.[33] David Gardner called it. If something smells funny in Time Warner's (NYSE: TWX ) third-quarter report, it's just the pungent odor of a rotting AOL.[38]

Time Warner is letting AOL go debt free because "we want to make sure AOL is in best position to succeed."[27] Time Warner will not be saddling AOL with debt during the spinoff, so it will enter independence in a position to succeed, Martin said.[13]

Oh, and just because Time Warner finally plans to spin off AOL next month doesn't necessarily mean that the stink will go away.[38] On the rumor that TW Investments was looking to divest itself of non-core investments (not directly beneficial to Time Warner after the AOL spinoff) to secondary VC firms, a source tells me that isn't true. At least not for now.[33]

Time Warner said its business outlook has improved on a better-than-expected quarter.[3] Reconciliations of our expected future financial performance are also included in the business outlook release available on site. Actual results may differ materially from those expressed or implied through these statements due to various factors. These factors are discussed in detail in Time Warner's SEC filings.[14] Despite tough macro-economic conditions, Time Warner Inc. ( TWX ), the global leader in media and entertainment businesses, reported better-than-expected third-quarter 2009 results that topped the Zacks Consensus Estimate.[10] Time Warner Inc.' s filmed entertainment division, which includes Warner Bros. Pictures and Warner Home Video, became the second studio this week to report an upturn in profitability despite the ongoing economic recession.[35]

Let me just give you one example. One of the reasons why Warner is having such a great year this year against the backdrop of a tough home entertainment environment is because they've done a phenomenal job this year of cutting out costs in their home entertainment division. If you just think about the initiatives that they've undertaken. They've cut SG&A double-digit percentage over a year ago level. They've cut marketing and improved the efficiency of marketing spend by even more as a percentage of total spend, and they don't feel like it's really impacted their sell-through units. They've taken a much more stringent approach to their shipment of good which has resulted in lower returns, which you've seen us make some slight adjustments to our returns reserve, all of which is a reflection of improved profitability against the business.[14] Warner Bros. also cut sales, general and administrative (SG&A) costs by double-digit percentage while increasing marketing spend. Theatrical film revenue from third-quarter 2009 releases, such as Harry Potter and the Half-Blood Prince and T he Final Destination, as well as carryover from The Hangover, were slightly lower than in the prior-year quarter, which benefited from the success of The Dark Knight.[35] Although revenue was slightly off due to weaker DVD sales, down 4% to $2.8 billion, the decline was offset by studio cost savings initiatives.[31]

The biggest decline in sales came from the Time Inc. unit, in which revenue dove 18%.[3]

Like other U.S. magazine publishers, Time Inc. has been facing a steep drop in print advertising revenue, steadily declining circulation and the migration of readers to free news online.[5]

Since 2007, the company has shuttered magazines including Business 2.0, Cottage Living, Southern Accents and Life. Last year at this time, Time Inc. announced that it planned to cut 6% of its workforce, or more than 600 positions. This year'''s layoffs are also expected to be around 6% of staff.[29] Time Inc. cut around 600 jobs last year and has shuttered several magazines recently including Southern Accents and Life. It also cut the frequency of Fortune magazine to 18 issues a year from 25.[5]

Last year we undertook a broad-based reorganization at Time Inc. to centralize our domestic magazines into three clusters.[14]

The ax finally dropped at Time Inc. the company started its layoffs on Wednesday as it aims to reduce costs by $100 million across the publishing division. [28] Time Inc. spokeswoman Dawn Bridges told The New York Times the current restructuring program "will result in a charge of up to $100 million."[6] As I mentioned a few moments ago, we expect to incur as much as $100 million in restructuring charges at Time Inc. in the fourth quarter.[14]

according to AOL’s Daily Finance, Time Inc. executives "have asked for an "emergency meeting with representatives of the Newspaper Guild to discuss job eliminations." (Some employees at Time Inc. are members of the Guild, though not all.) This is just the beginning, as a report last week indicated that the mega-publisher is looking to trim $100 million from its budget.[39]

The content group alone is expected to have adjusted EPS for the year of $1.75. Bewkes said the company still expects to spin off AOL by the end of the year, and I'm sure he's not going to be sad to see it go. [30] The Company expects 2009 full-year Content Group Adjusted EPS to be at least $1.75, compared to Content Group Adjusted EPS of $1.42 in 2008. This outlook includes the expected restructuring charges in the Publishing segment mentioned above."[34]

Let me turn now to our business outlook. As both Jeff and I previously mentioned this morning, we raised our 2009 adjusted EPS outlook to at least $2.05. and as Jeff described, our new outlook now takes into account anticipated restructuring charges of up to $100 million in publishing.[14]

Higher theatrical and cable TV financial results lifted News Corp. net income 11% to $571 million in the third quarter.[23] The cable networks owner reports 29% drop in net income, slight uptick in revenue for third quarter.[39] Management said while ad trends were better than expected in the third quarter, fourth-quarter ad figures should decline due to tough CNN comparisons with last year's elections and lower TBS and TNT network ratings in September and October amid lower baseball playoff games and fewer big film and show premieres.[9] Through the third quarter, our conversion ratio was over 60%. As expected, this is lower than last year's third quarter as a result of higher cash taxes and fluctuations in working capital.[14] We knew coming in to the third quarter that our year-over-year comparisons were going to be very difficult. While this quarter was our most challenging of the year, results were actually quite a bit better than we had anticipated.[14]

We're really managing the business over annual cycles. So we had really favorable expense trends in the first half of this year, and a lot of it was tied to two things. Number one was sports where we had lower amortization of sports costs this year versus they year ago first half of the year, and a lot of that fell in the second quarter. Then we also had a lot of our original and newly acquired programming airing and broadcasting in the third and fourth quarters of this year.[14] Stronger-than-expected theatrical results and past cost measures contributed to the upside surprise. "We find it remarkable that TW has been able to grow its film OIBDA for each of the past six quarters, through massive cyclical and structural downturns, and over a time period where the other five major film studios have suffered 30%-40% year-over-year OIBDA declines on average," said Barclays Capital analyst Anthony DiClemente.[9] I'd also point out that we don't plan to shift debt over to AOL prior to the separation, so once we spin AOL, our leverage ratio should be around two times, and that's a little closer to our long-term target of about two and a half times. Leverage will also move probably a little bit higher in the fourth quarter, as a result of our continued returns to shareholder through both dividends and share buybacks. That concludes my proactive remarks, and as always, thanks for listening in and again, apologies for the audio difficulties.[14]

Our content group margins were up again in the quarter as a result of margin expansion at each of our film and networks divisions. Lastly on this slide, our adjusted EPS was $0.61 in the quarter and we've now generated $1.51 year-to-date through September.[14] As Jeff described, Warner Brothers is having another standout outstanding year. Going into this quarter we fully expected our films adjusted OIBDA to be down year-over-year and that's due to at least three things.[14]

Time Warner's network showed steady improvement. Its film studio was mixed, with a slight top-line dip more than offset by marginal growth on the bottom line.[38] Time Warner's movie studio and cable channels, which rely less on ad dollars, fared better.[8] "I'm confident that the new content-focused Time Warner will be well positioned to deliver steady and attractive stockholder returns in 2010 and beyond."[11] There's nothing as it relates to the state of the business that it would be enhanced by virtue of continuing to remain part of Time Warner.[14] Analysts credited Time Warner's efforts to cut back on expenses, particularly at Warner Bros.[20] Time Warner is also grappling with the slump in print advertising demand amid the global recession, as advertisers are migrating to the Internet.[10] In our view, Time Warner offers an attractive combination of offensive and defensive characteristics: above-average growth, relatively low-earnings risk,.[37] We would remain on the sidelines for now. Time Warner Inc. ( TWX ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.[25] At Time Warner we know that capital allocation decisions are just as important as operating performance and driving returns. We take this responsibility very seriously.[14]

At filmed entertainment, led by Warner Bros., revenue fell 4% to $2.8 billion on softness in the homevideo market. [2] Revenues in the quarter fell 5.9% year-over-year to $7.14 billion, ahead of consensus estimates of $7.08 billion.[34] Revenue fell 6 percent to $7.1 billion, roughly matching Wall Street forecasts.[20]

Advertising, magazine sales tumble: Sales for the company fell 6% to $7.13 billion, just topping analysts' forecasts of $7.07 billion.[3] The company said adjusted operating income before depreciation and amortization (adjusted OIBDA), a commonly used profit metric for media companies, fell 9% to $1.8 billion, topping analysts' expectations of $1.7 billion.[3]

Jeff Bewkes and company reported Q3 revenue of $7.12 billion, which was more or less on track with the consensus estimate of $7.08 billion.[4] Looking ahead, the company said fourth-quarter ad revenues and subscriptions are improving, with food, automotive and beauty advertising poised to show better numbers than last year.[28] Notwithstanding revenue declines and the impact of unfavorable FX and higher pension expenses, consolidated margins were relatively flat compared to last year as we continue to focus on cost management across the company.[14] Management is also continuing to focus on costs here but the magnitude of the revenue declines pushed margins lower in the quarter.[14]

Looking ahead to the fourth quarter, we expect to see additional improvements in the pace of revenue declines due to easier comparisons and improving business fundamentals.[14]

AOL is a laggard among laggards. Yahoo! (Nasdaq: YHOO ) and IAC's (Nasdaq: IACI ) media and advertising revenue fell by 8% and 12% respectively this past quarter.[38] AOL revenue plunged 22% and profits dropped by half last quarter as it continues to bleed subscribers and advertising remains sluggish.[2]

The pace of ad revenue losses is slowing, at least. AOL reported a 21-percent year-over-year loss in the previous quarter, but search revenue took a bigger hit this quarter than last.[13] AOL's ad sales revenue fell 18 percent versus the year-ago period, while subscription dollars dropped another 29 percent.[19] The group's ad revenues dropped 1 percent and slowing DVD sales led to a 12 percent decrease in content revenues, while subscription revenues showed promise with a 9 percent increase.[6]

Subscription revenue, which will continue to shrink, was down another 29 percent, and ad revenue, which is supposed to improve one day, was down 18 percent.[4]

Subscription revenue fell 29 percent and advertising revenue declined by 18 percent.[5]

Filmed Entertainment revenue fell 4% to $2,780 million mainly due to lower revenue from home video and interactive games and the adverse impact of currency fluctuations.[10] Revenue for the quarter was $417 million, which compares to the estimate of $402.56 million.[41] Studio revenue declined 4% ($101 million) to $2.8 billion, due primarily to lower revenue from home video and interactive games, and the unfavorable impact of foreign exchange rates.[35] Cable revenue was up a healthy 5.2% to $2.87 billion and AOIBDA rose 8.7% to $1.1 billion.[24] Analysts, on average, were projecting full-year 2009 EPS of $2.03 on revenues of $28.07 billion. These estimates and the above guidance may not be comparable.[34] Quarterly revenue slipped 6% to $7.1 billion, matching the consensus estimate.[32]

We ended the quarter with about $7 billion of cash on hand. As I've discussed before, we don't intend to operate at these types of cash levels over the longer term and in fact, we expect cash to decline by at least $2 billion this quarter, due to a debt maturity later this month.[14] Media conglomerate expects to restructure its Time Inc. publishing unit in the current quarter, raises guidance after better-than-expected quarter.[3] Hearst, Time, Wenner Plot Promos for Mag Industry Adweek Hearst Magazines president Cathie Black, Time Inc. chairman Ann Moore and Wenner Media chairman Jann Wenner are having private talks about a marketing campaign to boost the image of the magazine business.[23] Magazines, after all, are widely believed to be a dying form of communications, imperiled by the speed and ever-improving content of the Internet. Bewkes would probably not want to go down in history as the CEO Who Betrayed Time Inc. and turned his back on the company's glorious past." In a memo sent out to the flagship magazine's staff (here reproduced by Gawker's Hamilton Nolan ), editor Rick Stengel expressed his hope that "up to 12" editorial staffers would themselves choose to be a part of the company's "glorious past" by voluntarily accepting a buyout.[7] A spinoff of Fortune magazine, FSB was published by Time Inc.' s Content Solutions custom-publishing division on behalf of American Express.[23]

Fortune Small Business was moved to Time's Custom Publishing division from the news group a year ago.[28] The company's fading access business is old news. It peaked years ago, so it's not much of a shock to see just 5.4 million "You've Got Mail" accounts, or 2.1 million fewer subscribers than a year ago. It's inexplicable to see AOL kill this business off slowly, when it could have sold it to Earthlink (Nasdaq: ELNK ) or United Online (Nasdaq: UNTD ) while it was still worth buying.[38] The company' theatrical/DVD division recorded $291 million in operating income for the three months ended Sept. 30. That marks a 6% jump from the same frame last year.[31] Even recent releases like Where the Wild Things Are, Final Destination and The Informant have all exceeded expectations and we're very excited about upcoming films, particularly Sherlock Holmes and Clint Eastwood's In Vegas coming out before the end of the year. Now although we're releasing fewer movies this year, we're on track to match or exceed last year's domestic box office gross of almost $1.9 trillion.[14] The NBA season is starting strong. The 2009 and 10 NBA season began with its most-viewed opening night in the history. It was up in NBA. It was up about 40 to 45% from last year's opening night doubleheader. This kind of September-October ratings weakness would have an impact if it was a sustained trend, but we don't think that it is and whatever effect it will have, I don't think it's likely to be large and it won't be immediate. On the question of scatter, I think what you're asking is how is the scatter this year versus the scatter last year? And basically, in the fourth quarter what we're seeing is scatter up mid-single digits over last year's.[14] Execs predicted advertising at CNN would remain soft into the fourth quarter on tough comps from last year, which featured a riveting presidential campaign.[2]

Network sales rose 5% in the quarter, despite a 1% dip in advertising sales from the same period a year ago.[3] Progressive Targeting Boosts Lord & Taylor's ROI Rocket Fuel has partnered with Morpheus Media to drive sales, loyalty and brand engagement for Lord & Taylor. The fledgling hybrid ad network that launched earlier this year helped to triple the retailer's campaign goals from the first to the second for online sales of women's fashion, apparel.[23] We, basically, will continue to optimize that and the good news for us is because we've got the leading basic networks and the leading pay networks we can be the advantaged buyer and so that when we sale to ourselves we'll do it and not have any kind of subsidy problems. As the leading seller we absolutely need to keep alive the other customer, which are the four broadcast networks and other cable other networks, because that's the only way between them and our own networks that we can keep the lead level of sales in both theatrical and TV. Just to finish, because I hope you can tell I'm a little focused on this point and have been for more than five years.[14]

We buy about 25% of Turner programming coming from our own company Warner. Warner is selling about 25% of their sales out to Turner. Similar numbers for HBO and you can't really be number one as a consistently as we are in both the film side of Warner's and the series sales side of Warner's unless you are both selling to everybody that's in the buyer's market, meaning all the other networks and optimizing your sales to the leading network company which is us.[14] Ad sales fell 22% at the company's publishing arm, and subscriptions were down 24% in the quarter.[3] About a third of the subscription decline was driven by unfavorable FX with the rest a result of lower domestic newsstand sales and the lingering impact of lower renewals during the height of the credit crisis. Similar to last quarter, renewal rates have improved from the lower rates experienced at the height of the credit crisis.[14]

The film division slightly grew operating income before depreciation and amortization in the third quarter despite expectations of a decline.[9]

Film earnings rose 5.8% despite a 4% revenue drop. Key theatrical releases in the quarter included the latest "Harry Potter," "The Final Destination" and carryover from "The Hangover," but revenue was slightly below the year-ago period, which benefited from "The Dark Knight."[9] Theatrical film revenue from releases including "Harry Potter and the Half-Blood Prince," "The Final Destination" and "The Hangover," while sturdy, fell short of "The Dark Knight's" perf in the prior-year quarter.[2]

Our next question comes from Ben Swinburne ''' Morgan Stanley. Jeff, I wanted to ask you about the film segment, when you look at the two businesses there, Warner Brother's T.V., Warner Brother's Film, how you think about just sort of the secular growth of those two businesses? Obviously, the revenue mix in film is changing a bit as we go through changes in the home-video market.[14] Warner Bros. movie studio: Revenue down four percent, because of slumping DVD sales.[4]

The results indicate that advertising at the company's cable nets is beginning to recover, and that cost-cutting at Warner Bros. is paying off, Reuters writes ( via The New York Times). [29] Health Bills Aim A Light On Doctors' Conflicts New York Times The targets are common business practices like drug company payments to doctors for speeches and consulting services, Natasha Singer reports.[23]

Q+A Douglas Ferguson How will we consume media in five and 10 years' time? Ferguson: When everything is digitized and libraries offer materials, we will have access to anything and everything whenever we choose, at a trivial long-tail price. Q+A Lance Broumand How will get your news in a few years? Broumand: I think it's one page that looks a lot like what the Drudge Report looks like right now.[23] "The readers are still there." He said the company was trying to lure them with "a depth of analysis." He used the example of Fortune magazine, which, he said, will come out fewer times per year but with extreme attention to "the quality of each issue" and to reporting on the largest and most important companies.[2] The changes include reducing the frequency of Fortune to 18 times a year from 25 and focusing the magazine's coverage on the largest corporations.[28]

At Turner Entertainment Networks, we have seen some rating softness in September and October and we're not happy with it. Let me give you the context for it because both those networks are having a very successful time, generally, and Turner's having a great year.[14] The CEO said that despite a soft home entertainment market, Warner Bros. was on track to post the studio's highest fiscal year profits.[35] Based on the unparalleled track record of our studio under Barry Meyer and Alan Horn, we have every expectation that Warner will continue to lead the industry in the next years coming up. The second priority I mentioned is improving the efficiency of our business.[14] Last, I would say there's a fairly long established and increasing every year effort at Warner's to do local production of films.[14]

We're essentially in general focused on either of the fast growing regions which would be if you're doing geographic, Latin America, Eastern Europe, India. Or the fastest growing sectors within even developed economies which essentially would, because those are slowing growing in the long run. Those sectors would essentially be some local production and TV networks. If you look at what we've done and what you see in HBO's recent activities, we have been buying in our partner shares in HBO, which is number one wherever it operates and it operates across Latin America, Eastern Europe, and Asia, and we're now in a majority ownership position in all of those that would be one. Two is we have worldwide launch and distribution of most of our big recognized networks, CNN, Cartoon, HBO, little more the Turner classic movies, less consistently TBS TNT and what we've been doing, CME being an example, is in targeted regions buying into those network companies that we think are ones that can be leaders in both broadcasting and multi-channel cable satellite broadband distribution. CME is one of those, and we got in a position where we have a pretty good participation in the economics of it now and we believe we have a fairly good position if we were to acquire a larger stake in it or manage it in a more coordinated fashion with Warner, Turner, HBO, and other kinds of channels.[14] If the issue that we're talking about here is whether an attempt long waited for by broadcasters to move to some retrans consent is going to be increasing rather than weakening competition for strong cable networks I would go with the cable networks not the broadcasters and I would just site the record low shares for broadcast networks which has stabbed down into the mid 20s. Cable being at its highest level, broadcast now being at its lowest and as you know the economics of those things they are basically unable increasingly to finance and schedule compelling programs. I think we have a very clear few on it and I would just finish by saying it may be possible for distributors, cable, satellite, Telco, to do some efficiencies in their program buying to weaker networks. I think what you'll see is a bigger separation between the strong branded networks which is what we have and some of the niche weaker ones that were frankly carried in the past by momentum, by their ownership, by the broadcast companies that were essentially porting retransmission from broadcast over to some associated co-owned cable network and I think that's what happened.[14]

Can you help us think about your international expansion strategy in the cable networks and how large of an investment you intend to make over the next year or so.[14] Bewkes also seemed unconcerned about the premise that distributors would play hardball with cable networks to keep down carriage fees. "It may be possible for distributors to do some efficiencies in their program buying to the weaker networks," Bewkes said. "But what I think you'll see is a bigger separation between the strong branded networks and some of the niche weaker ones that were frankly carried by momentum, by their ownership by broadcasting companies that were essentially porting retransmission from broadcast over to some associated cable network."[24] "We think the big must-have, big reach networks will gain bargaining leverage in the coming years," Bewkes said on the call. "They are essentially competing with ever more distribution choices -- telcos, cable, satellite and broadband -- and all of those all need strong, identifiable brands. If you have the strong and lead brands in those categories with a lot of reach, you're going to see the leverage go up.[24]

Chairman and Chief Executive Officer Jeff Bewkes said: "We still expect to spin off AOL by the end of the year, and we'''''''''''''(TM)re making great progress on our other longer-term strategic priorities. [34] Bewkes also reiterated the company expects AOL to be spun off by the end of the year.[28]

The company's publishing arm was a mess, but let's take a closer look at how AOL has let itself go in recent years.[38]

We're also providing a full year outlook for the content group and because of our expectation that AOL will be spun off before the end of the year and if we meet that goal, AOL will be reflected as a discontinued operations in our consolidated financial statements following the spin-off and will no longer be reflected in our adjusted EPS figures.[14] A year in the making, MSN Wednesday is expected to debut a refurbished home page that puts the focus on Bing-powered search, local content, in-line video, and the social networks that are consuming an ever greater share of consumers' digital lives.[23]

TWX said it bought back 18 million shares for $330 million since it reported Q2 results on July 29. TWX this morning is up 79 cents, or 2.6%, to $30.95.[30] Fourth quarter results will also reflect the charge of up to $100 million and that's tied to the restructuring initiatives that Jeff described a little earlier.[14] The forecast includes the $100 million restructuring charge to be incurred in the fourth quarter.[28]

As expected, Time Inc. announced that it plans to cut another $100 million from costs; the reduction is expected to come mainly from layoffs. [29] Closed for 15 months ''' opening 10 days only! Get notified ahead of time as our expert portfolio manager invests $1 MILLION in the best opportunities from across The Motley Fool'''s premium investment services. This is the first open since August 2008, by invitation only.[38]

By contrast, TW's media networks division, encompassing the Turner cablers and HBO, saw operating income rise 3% to $938 million.[2] From Ad Networks To Audience Aggregation: Where Advertising Is Heading The ability to target and buying audience segments is rapidly becoming the holy grail of online marketing, replacing traditional media planning strategies built around content. Who will win in this race to deliver targeted audience? The new crop of ad exchanges? Ad networks? Agencies creating their own.[23] Giant Time Inc., which is in the midst of another round of layoffs, has been one of the most visible casualties of a one-two punch: a general crisis in the print media as ads migrated online was followed by a severe economic downturn that squeezed advertising even more.[2] A year ago - nearly to the day - Time Inc. announced a dramatic reorganization that included as many as 600 layoffs. This time around, it looks like the total will be closer to 500.[39] Close on the heels of the announcement of a new round of layoffs, Time Inc. is also closing Fortune Small Business.[23] A source familiar with the job cuts said the company had offered voluntary buyouts Tuesday night to Time Inc. employees who are members of the Newspaper Guild. Most of those employees work for Fortune, Fortune Small Business, Money, Time, Sports Illustrated and People.[3] People, part of Time Inc.' s style and entertainment group, is looking for eight volunteers. At other titles not a part of the Guild, Essence let go of around a dozen employees, including at least four on the print editorial side with the rest coming from its Web site, and Entertainment Weekly cut about 11 staffers, mostly on the business side. InStyle laid off about six employees across both the editorial and business sides.[28]

Time Inc. on Wednesday shuttered Fortune Small Business, affecting at least one full-time staffer and another four or five employees who worked on that title as well as other projects.[28]

"The call for volunteers will expire on the close of business November 18," the memo declared flatly. Update, 2:43 p.m. : Since posting this, more (bad) news has come out Time, Inc., including the fact that Fortune Small Business has been shuttered .[7] The Age of Consent Consumers may find it intrusive if not downright creepy, but marketers, under immense pressure to meet quarterly goals, depend on behavioral targeting to squeeze digital dollars out of dimes. The question is: Can it be done in such a way that is beneficial to everyone? DOA Q&A: Philip K. Dick At a time when the whole world feels like it's falling apart, who better to talk to than someone who suggested that might be the case? Church & State Can the news business survive once-sacred walls toppling? Work with me on this, because you, the reader, are an integral part of this story. I want you to pick up this magazine.[23] Startup Plans to Sell Magazines, Piece by Piece New York Observer A trio of under-30 former Wall Street analysts -- Ryan Klenovich, Jian Chai, and Steve DeWald -- plan to save the magazine business with a Web site called Maggwire.com.[23] Dylan Stableford is a veteran media reporter based in New York. Most recently, he served as senior editor, digital at FOLIO: magazine. He was formerly the managing editor of Mediabistro.com, including its popular network of media blogs, an editor at MTV.com during the dotcom boom and served briefly as an associate producer of the "Howard Stern Show" on E! He writes regularly about music and culture for several publications, including Rolling Stone, New York and Salon.[39]

We all know that the business has changed a bit but gradually over the years as the broadcast networks look towards in-house programming. That has worked out, and this is not new as an advantage for us, because we are the supplier of second choice to all four of the big networks.[14] We ended up with three fewer major league baseball playoff games in 2009 versus 2008. We had fewer new series on the key comedy launches at TBS this year and we didn't have at TBS any network premiere movies in October, whereas we had two the prior year. Now there is ''' so those are essentially scheduling that we'll move around and some will show up in the current month.[14] Yep, Google co-founder Larry Page and CEO Eric Schmidt tell author and New Yorker scribe Ken Auletta that the search giant took a serious gander at the Grey. Microsoft Announces Third Round Of Cuts TechFlash et al. Marking the software giant's third round of layoffs this year, Microsoft is cutting another 800 jobs company-wide.[23] Jeff Zucker Is Not Going Anywhere Jeff Zucker, CEO and president of NBC Universal, has been trying to turn digital dimes into digital dollars for years. Currently he's delivering tv programs online through Hulu, transforming nbc tv stations into hyper local Web destinations, and selling tv advertising based on the Internet's automated, targeted model. Jonathan Miller Preaches the Agnostic Gospel of the Cloud Jonathan Miller is more determined than ever to crack interactive media's money-making code in his new job as News Corp.' s digital chief. He's got plenty of learning experience to draw from, both as a partner at venture capital firm Fuse Capital and as the chairman and CEO of.[23]

Moving over to AOL. We saw only a slight improvement in advertising trends in the quarter down 18%. That compares to a 20% decline in the first quarter and a 21% decrease in the second quarter. Looking at the components, AOL Media, which includes both display and page search, remain soft.[14] Martin laid some of the blame for revenue declines at Google's feet, saying the cost-per-click advertisers pay for ads showing on AOL's site were down due to algorithmic changes by Google.[13] Ad revenue has taken an 22% hit over the past year. That certainly doesn't hold up well against Google's (Nasdaq: GOOG ) growth during the same three-month period.[38]

I think generally speaking, though, if you think about just the way that we're trying to run the networks, and that's true for each of Turner as well as HBO over the longer term, is to try to have expense growth be contained at a percentage that's lower than revenue growth.[14] I'm trying to figure kind of a core expense growth rates for your domestic Turner networks and domestic HBO, the first three quarters of the year. I could take a crack at it; Jeff can fill in where I miss something, but the one thing, Michael, and I think this has been a consistent message with us all along which I that it's always we would caution against looking at particular quarters.[14] We think the big must have, big reach networks will gain bargaining leverage in the coming years. I think some of what I think that you're asking if you're conveying what some of the distributor level companies are saying I would not agree with which is that there essentially and this is good and it's also the direction of public policy in Washington. They are competing with evermore distribution choices. Telco's, cable, satellite, broadband and all of those as they compete need the strong identifiable brands like CNN, HBO, TNT and so forth, so if you have the strong and lead brands in those categories with a lot of reach you're going to see the leverage go up.[14]

HBO Sports senior vice president Mark Taffet discusses the PPV performance prospects for the Sept. 19 Floyd Mayweather Jr. -Juan Manuel Marquez boxing event as well as the network's PPV fight schedule for the rest of the year during a recent'' interview with Multichannel News.''[24] Survey: Agencies Are Ready To Spend Mobile ad budgets are headed up next year, according to a new study.[23]

Based on current bookings food, auto and beauty categories are now pacing to show year-over-year increases in the fourth quarter, and that is very encouraging. Subscription trends also continue to improve relative to the first half of this year.[14] In fourth quarter scatter, we're seeing up mid-single digits over last year's up-fund. Compared to last year's fourth quarter scatter is stronger, but it's offset a little bit, not much, by the fact that the upfront for everybody was down slightly from last year, so scatter-on-scatter, year-to-year is up somewhat.[14]

The studio is also on track to equal or beat last year's $1.9 billion box office haul despite releasing fewer movies in 2009.[35] TW's overall quarterly profit of $661 million was down from $1.07 billion in the year-ago period.[9] Moving on to free cash flow on the next slide which highlights the detail. Our cash generation remains quite strong and we delivered over $1 billion in free cash flow this quarter now above $3 billion year-to-date.[14]

The quarterly earnings of 61 cents a share beat the Zacks Consensus Estimate of 52 cents, but dropped 6% from 65 cents delivered in the prior-year quarter.[10] Excluding unusual items, earnings came to 61 cents a share. That tops the analysts' average forecast of 53 cents, according to a survey by Thomson Reuters.[8]

All in all, I would give you a summary on television that says we think we can continue to grow it and continue to produce fairly consistent earnings and cash flow. At the risk of making a longer answer slightly longer, I do just want to just add on from a capital deployment standpoint, we do think a lot about the absolute level of capital that we're committing to this business. We feel like we are at or about the right range at this moment in time with the right split between theatrical and TV, and we're going to continue to focus on improving the returns in the studio business and it's going to not only come from top line growth, but by also managing the operational efficiency of the business. [14] As you know we currently pay a meaningful dividend. We intend to maintain this same dividend after the AOL separation and we would like to grow it over time in line with underlying business trends.[14]

We've always made tremendous progress toward a single sign-on for consumers that would enable consumers to move between multiple unaffiliated Web sites without reregistering, making TV Everywhere a completely seamless user experience. An analogous example is the way we're approaching e-readers in the publishing business where we've also been working hard to help flush these. We view the emergence of e-readers as a critical opportunity for magazines to migrate their dual revenue stream models to a digital environment. There's no question about consumer willingness to buy quality content on their IPod or on their Kindle.[14] We've got a pretty healthy market for our network series production overseas. On the syndication business, we're fairly happy with what we've been able to do, to the extent that syndication, if it's true, it's not clear what will happen. If it goes kind of vertical to in-house supplies, we've got a pretty good position and it's not a huge part of our revenue business.[14]

The company's TV unit posted a 3.2% profit improvement on a 5.2% revenue gain.[9] The decline resulted from an 18% decrease in advertising revenues as well as a 29% decline in subscription revenues.[22]

The problem here is that the equity's 20-month moving average is dropping through the $32 region. Since the middle of 2007, the shares have closed above this trendline once. This trendline's resistance has served as a catalyst for the stock's substantial decline.[32] We need to be weaned off the click. That's what the online marketing world needs right now to improve branding, according to eMarketer. When Algorithms Collide The online advertising marketplace has seen its fair share of arms race-like tit-for-tat technology battles over the years.[23]

We are executing very well in spite of the tough environment. We're raising our guidance and we're on track to complete the AOL spin this year.[14]

Access lines at quarter ended stood at 5.4 million, down 2.1 million from a year ago.[30] AOL ended the quarter with 5.4 million dial-up subscribers, down 438,000 from the quarter before.[8] As of Sept. 30, 2009, AOL's dial-up Internet service had 5.4 million U.S. subscribers, down 438,000 from the prior quarter and 2.1 million from the same period in 2008.[15]

AOL averaged 102 million U.S. unique visitors per month and 44 billion domestic page views, which translates to 144 pages per unique visitor.[22]

How To Create A Successful Low-Cost Video Network On YouTube's most-viewed channel list you'll find the how-to video network ExpertVillage in second place for all time with 812 million views. [23] There are some very high profile examples of times like Sopranos when we made a decision to sale the program for a lot of money to another network.[14]

Friedman went on to say, "Time Warner really has no practical use for a magazine operation, when you look at the conglomerate with a cold, rational eye."[7] How's that? Well, Fortune magazine, for instance, will publish less frequently, which will supposedly make each issue that much better. One item of note so far: While Time Inc. has said that it will not be closing titles during this round of cuts, Bewkes left the door wide open for future moves, promising to "take a hard look at non-strategic and unprofitable titles." In the meantime, while I've read reports that say folks who work in online operations won't be affected by the cuts, that's not the case; I've heard of a few different staffers on the Web side who are on their way out.[36] Time Inc. also will further pool the management and editorial teams across all the news group brands.[28] Data Novice: Google Proves Peace On Earth New York Times Writing in the Times, author and analytics novice Colson Whitehead employs Google search data to prove his theory that our country has officially entered an era of "postraciality." Noting that journalists, in his opinion, employ Google searches to lend credence. Expert: Windows 7 More Prone To Malware ComputerWorld At least one researcher is saying that Microsoft's decision to reduce the number of security messages that its new operating system, Windows 7, delivers when users install software makes its more vulnerable to "malware" infection[23] Ivanka Trump Leverages Her Nearly Half-Million Strong Twitter Following 9 hours ago Ivanka Trump reached a quarter of a million followers on Twitter in less than three months during a promotion for her latest venture (of course, during this period she also had a highly publicized engagement to New York Observer publisher and fellow real-estate royal Jared Kushner going for.[23]

We also continue to expect very strong results in the upcoming fourth quarter as our successful summer films, Harry Potter and The Hangover will be released on home video. [14] Collins Stewart analyst Thomas Eagan called the film division's results "standout." Another analyst, Caris & Co's David Miller, said: "Cost containment has been thematic to the Jeff Bewkes regime. He demonstrated this hawkish ability to keep an eye on costs once again."[20]

I hope everybody kind of checks it and realizes that the number is substantiated, that you can't have which is why our competition doesn't have the kind of consistency and the high level of earnings unless you can do both, and so the most recent examples are Mentalist and Southland, huge hits from Warner's onto the broadcast networks and award critically acclaimed. [14]

SOURCES

1. Regardless of Declining Profits in 3Q, Time Warner Raises its Outlook | TopNews United States
2. Time Warner profits take a tumble - Entertainment News, Technology News, Media - Variety
3. Time Warner sees brighter future - Nov. 4, 2009
4. Time Warner Beats Consensus, Announces Big Layoffs at Time Inc. | Peter Kafka | MediaMemo | AllThingsD
5. AFP: Time Warner net profit down but raises outlook
6. Time Warner Earnings: Growth From Networks Can't Offset Publishing Declines - mediabistro.com: FishbowlNY
7. Time Warner Released Third Quarter Layoffs Begin At Time Inc - Pressed - Portfolio.com
8. The Associated Press: Time Warner 3Q profit drops, boosts outlook
9. Time Warner Q3 profit falls, raises forecast
10. Time Warner Reports Better than Expected Third Quarter -- Seeking Alpha
11. Time Warner posts lower profit but raises outlook : US Business
12. Time Warner Beats the Street | Market News Video
13. AOL Ad Revenues Way Down - ClickZ
14. Time Warner Inc. Q3 2009 Earnings Call Transcript -- Seeking Alpha
15. AOL Sees Revenue, Operating Income Plummet in Third Quarter | Digital Media Wire
16. AOL global revenues slump 23% - Media news - Media Week
17. AOL, On The Verge Of Independence, Weighs On Parent - WSJ.com
18. BBC NEWS | Business | Time Warner raises profit outlook
19. Untitled
20. Time Warner Profit Beats Estimates - ABC News
21. Time Warner Q3 Profit Tops Estimates | Media | Financial Articles & Investing News | TheStreet.com
22. AOL Ad Revenues Decline by 18% in Q3 2009 - Search Marketing News Blog - Search Engine Watch (SEW)
23. MediaPost Publications - Home of MediaDailyNews, MEDIA and OMMA Magazines
24. Bewkes: Retrans Could Hurt Smaller Channels - 2009-11-04 12:09:07 EST | Multichannel News
25. Dividend Stocks The Dividend Daily » Blog Archive » Time Warner Q3 Profit Tumbles 38%, Beats View; Forecast Raised (TWX)
26. Earnings roundup: Time Warner, Garmin - Forbes.com
27. Bewkes Asks Analysts To Imagine Time Warner Without AOL. Pretty Please. | paidContent
28. Time Warner Profits Fall. MSLO Declines. - Fashion Memopad - WWD.com
29. Time Warner Profit Drops 38% but Betters Expectations - MediaBuyerPlanner
30. Time Warner Q3 EPS Tops Estimates, No Thanks To AOL - Tech Trader Daily - Barrons.com
31. Time Warner says DVD market stabilizing - 11/4/2009 - Video Business
32. Time Warner tops expectations in the third quarter - BloggingStocks
33. AOL Keeping Its Venture Investments And AOL India | paidContent
34. Time Warner operating income slides 10% on weakness from AOL (TWX) - Comtex SmarTrend Alert
35. Time Warner Q3 Studio Results Exceed Expectations | homemediamagazine.com
36. Chart: Why Time Warner Is Slashing Jobs at Time Inc. | Peter Kafka | MediaMemo | AllThingsD
37. Warmer on Time Warner - Barrons.com
38. What's Wrong, AOL? (TWX)
39. Cuts Begin at Time Inc. | The Wrap
40. Ask.com, Microsoft and AOL - Internet Love Triangle? -- Seeking Alpha
41. StreetInsider.com

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