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Nov 5 2008

AOL falls further as its ad business declines

Saad Ali Abbasi 

AOL_Logo AOL seems to be falling even further as stats suggest its advertising business is falling apart. Ad revenue has decline 6% year over year, as compared to Yahoo, Microsoft, and Google which are witnessing growth of 0-20%. AOL’s stats would be even worse if not for its recent search deal with Google. AOL also sees its premium inventory going down as ad-revenue per unique visitor dropped 15% year over year. Though AOL’s cash flow before capital expenditures seem to be solid even under these circumstances, showing a decline of only 7%. While AOL’s Platform A also has a decline in profit margins, despite massive cost cutting. Time Warner, owner of AOL and its subsidiaries however is still going forth strong, and will generate $5.5 billion of free cash flow this year, despite the collapse of economy. Guess the company’s reduced outlook on higher restructuring charges worked out okay.

[via Silicon Alley Insider]

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