AOL Earnings Rise as Online Advertising Revenue Increases

AOL

saw a nearly 350% increase in net income in the first quarter of 2012 as the company expenses declined and advertising revenue rose. Restructuring costs decreased $20 million to $7.4 million as income rose from $4.7 million, 4 cents per share, to $21.1 million, 21 cents per share. Earnings topped the 17-cents-per share estimate of analysts surveyed by Bloomberg. Advertising revenue rose 5% to $330 million. AOL, owner of local-news sites in the Patch.com network, has expanded out of its original web access services in since being spun off from Time Warner in 2009. In March 2011 AOL completed the purchase of Huffington Post, which had more than 27 million unique monthly US visitors at the time of the acquisition. About six months earlier AOL purchased the TechCruch family of sites. “AOL is a much stronger company today than a year ago,” Chairman and Chief Executive Officer Tim Armstrong said today in a press release. The company “began 2012 by growing advertising revenue (and) lowering expenses.” Subscription revenue for the company declined 15% to $182 million and revenue declined 4% to $529 million, beating the $525.2 million average estimate of analysts surveyed by Bloomberg. AOL made more than $1.05 billion in April with the sale of more than 800 patents to Microsoft

. AOL said it would return a significant portion of the proceeds to shareholders in a press release issued at the time. Starboard Value, a hedge fund with a 5% stake in AOL, has been pressuring stockholders to elect its three-member slate of director candidates to the board of directors at the June 14 stockholder meeting. “Starboard continues to advocate a short-sighted approach that would result in the effective liquidation of the Company by significantly weakening its product offering and attractiveness to advertisers, and has never offered any viable strategy or vision for the future of the Company,” Armstrong said in a letter sent to shareholders earlier this month. “Starboard has issued a barrage of materially false and misleading statements targeted at AOL's stockholders as part of a campaign to elect their handpicked directors to AOL's Board.”