News Column

Former giant AOL left reeling by income drop

May 8, 2014

OLIVER SMITH



MEDIA firm AOL was rocked yesterday as its shares dived 20.6 per cent to $34.85, punished by investors after income fell 64 per cent to $9.3m (5.5m) in the first quarter.


The media and entertainment company said revenue from ads bought and sold on its electronic exchange soared 55 per cent to almost $187m, with total revenues reaching $583.3m, but this was not enough to rescue its share price.


Advertising has become a crucial revenue stream for AOL, and its growth is now critical to the firm's overall performance, as revenue from its dial-up internet dries up.


The company, which owns the Huffington Post and the TechCrunch blog, has been investing in advertising as a priority of chief executive Tim Armstrong.


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Source: City A.M. (UK)