AOL beats Street on earnings, but changes could be afoot
The company posted revenue during the first quarter of $529.4 million. Its net income hit $21.1 million, jumping 349 percent over last year.
Last updated: 9:04 a.m. PT
AOL had a stronger-than-expected first quarter, posting higher revenue and profits than Wall Street had expected.
The online giant today announced that it generated $529.4 million in revenue during the first quarter, beating the Street's $527 million consensus. AOL was able to make a $21.1 million profit, or 22 cents per share, during the period. AOL's profit was up 349 percent year-over-year from the $4.7 million net income it posted last year.
"AOL is a much stronger company today than a year ago and began 2012 by growing advertising revenue, lowering expenses and improving Adjusted OIBDA trends," AOL chairman and CEO Tim Armstrong said today in a statement. "In 2012 and beyond we are simultaneously focused on the continued successful execution of our strategy and on creating and unlocking value for our shareholders."
In order to unlock that value, might AOL be eyeing a rather surprising move? Pando Daily is reporting, citing sources, that AOL is considering selling off its two most popular technology brands, Engadget and TechCrunch. The company might also, apparently, bundle Apple blog TUAW and gaming site Joystiq in the sale. The company is reportedly seeking $70 million to $100 million in the sale.
Armstrong was quick to squelch that chatter, however. He told PaidContent "firmly" that AOL has no interest in selling TechCrunch or Engadget. "Our number one goal basically has been to scale them up. At this point, it's likely we'll just end up investing ourselves," he said.
Still, it's clear the company is trying to find ways to generate cash. Last month, it announced the sale of 800 patents and related patent applications to Microsoft. The deal also includes Microsoft receiving a non-exclusive license to patents that AOL retains. Assuming regulatory approval is obtained,.
Since that sale, investors have been quite pleased with AOL, helping its stock climb nearly 39 percent to $25.58. This morning, the company's shares are down 3 cents in pre-market trading following news of its earnings.
CNET has contacted AOL for comment on the report that it could be planning to sell its technology brands. We will update this story when we have more information.
This story was updated to include comment from AOL chief Tim Armstrong.