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Mum's the Word at Time Warner

The publishing unit squeezed a 12% profit increase from flat revenue by cutting jobs and selling assets, and Time Warner's TV networks, HBO and Turner Broadcasting, posted a 6% increase in earnings and revenue.

Meanwhile, earnings at the embattled AOL division were down 24%, while revenue dropped 38%. The declines came from the loss of Internet-access fees that AOL dumped last year when it announced a shift in strategy towards an ad-supported business model.

Wall Street liked that idea, but its execution is lacking. Third-quarter ad revenue at AOL grew 13%, less than the 16% rate in the second quarter. That marks a dramatic slowdown from previous quarters of 40% ad-revenue growth, and the company said it expects further slowing in the fourth quarter and into next year.

Executives on the company's conference call dodged questions about what factors were driving the deteriorating outlook, but the company attributed it to price competition for display advertising and lower search advertising results in a regulatory filing. The situation has renewed calls on Wall Street for Time Warner to separate itself from the business.

AOL announced Wednesday that it will acquire Quigo, a company that matches online ads to the content, for an undisclosed amount.

"This company has to move fast -- the world is changing fast," Bewkes said on the conference call when asked to describe his management style. "We need to adapt all our products and how we offer them. All of that requires a lot of trial and error."

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