AOL has struggled to reinvent itself as a media and news group since its spin-off from Time Warner in 2009.
Its consolidated financial
statements reflect a year on year revenue growth from a loss of $795.3million
in 2010 to a profit of $13.5million in 2011 and a subsequent income gain of
$1,041.8 million in 2012. Advertising revenue - a key measure for the company
as it moves away from subscription-based dial-up services to focus on its media
outlets such as the Huffington Post- has risen consistently (7.9% in 2012).
However increasing cost of
revenues related to increased traffic acquisition costs and special items and the
steady decline in subscription revenues leave room for concern.
Victor Anthony at Topeka
Capital Markers concludes that AOL shares may “react positively off the
headline revenue outperformance” and profit growth, but added that “we would
have liked to see growth in domestic display (advertising) as evidence that AOL
can fully compete with Google and Facebook” (http://www.rawstory.com/rs/2013
/02/08/aol-shows-signs-of-revival-with-gains-in-advertising/).
In conclusion though a look
at a company’s financial statements might indeed provide valuable investor
information, but beyond those figures this report through in-depth analysis,
examines AOL Inc. and the conditions under which it operates, in order to
properly interpret its’ set of accounts and get the full story (not a
photoshopped version).
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