This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Time Warner to Split Up AOL

Updated from 9:01 a.m. EST

Media conglomerate Time Warner (TWX) plans to separate its struggling AOL unit's Internet access business from its Web portal and online advertising components, CEO Jeff Bewkes said Wednesday.

Bewkes announced the plans in a conference call to discuss the company's fourth-quarter and full-year financial results, which were roughly in line with Wall Street's expectations, as strong gains in cable television offset sliding revenue at AOL.

The CEO also suggested the company may reduce its stake in Time Warner Cable. Shares were recently rising 4.5% to $16.09.

Time Warner earned 28 cents a share in the fourth quarter, vs. 43 cents a share in the year-ago period, but those results were impacted by one-time items that decreased the current quarter's results by a penny a share and increased last year's quarter by 21 cents a share. Fourth-quarter revenue gained 2% to $12.64 billion.

Analysts polled by Thomson Financial expected a profit of 29 cents a share on revenue of $12.65 billion.

For the full-year, the company posted diluted income per share of $1.08, vs. $1.20 a share in the year-ago period. One-time items bumped up results by 12 cents a share and 40 cents a share, respectively. Revenue jumped 6% to $46.5 billion.

Analysts expected a profit of 96 cents a share on revenue of $46.46 billion.

Time Warner managed the revenue gains, despite a steep slide in subscription revenue at AOL. For the year, AOL's revenue slid to $5.18 billion, vs. $7.79 billion in 2006. The results were due to a 52% slide in subscription revenue, though advertising revenue gained 18%. The company last year sold its Internet access business in the U.K., Germany and France, contributing to the decline, and saw domestic revenue decrease as it offered email and other products to consumers for free.

Those losses, however, were offset by strong growth in cable television revenue, which grew to $15.96 billion, from $11.77 billion in 2006.

"I'm pleased that our company met or exceeded all of our financial objectives last year," CEO Jeff Bewkes said in a company statement. "Looking ahead, we've identified key initiatives that will enable us to deliver strong business results long into the future while increasing our returns to our shareholders."

Additionally, Time Warner said it expects to report full-year diluted earnings per share of between $1.07 and $1.11. Analysts expect a profit of $1.11 a share.

This article was written by a staff member of TheStreet.com.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,172.68 -107.06 -0.62%
S&P 500 1,994.29 -16.11 -0.80%
NASDAQ 4,527.6890 -52.10 -1.14%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs