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Google for the first time has acknowledged that it may face a loss on 5% stake in AOL. The search engine giant thinks that its investment of $1 Billion in AOL is not doing any good. The company in its most recent quarterly financial filing with the U.S. Securities and Exchange Commission, said:
Based on our review, we believe our investment in AOL may be impaired… We will continue to review this investment for impairment in the future. There can be no assurance that impairment charges will not be required in the future, and any such amounts may be material to our Consolidated Statements of Income.
On the AOL investment, Google said:
There can be no assurance that impairment charges will not be required in the future, and any such amounts may be material.
The company said that it would continue to examine its investment in AOL. Some analysts think that the company’s current worth is less than $10 billion.
AOL is already splitting up its Internet access business from its online operations, which is considered as a probable sign of its sale. For AOL’s dial-up access division, EarthLink Inc. is considered the leading bidder where as Yahoo and Microsoft may go for the online operations of the company.
This is really a front page news item. AOL was never a good choice… this company never took off.
AOL looks too good for Google.