Time Warner to split off cable service

CEO of media giant, which owns around 84 percent of Time Warner Cable and has been struggling of late, says "complete structural separation...under the right circumstances, is in the best interest of both companies' shareholders."

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Time Warner is splitting off its cable services division, the company said Wednesday.

Time Warner currently owns around 84 percent of Time Warner Cable. The media giant, which has been struggling of late, has been rumored to be discussing an AOL partnership with Yahoo.

"A complete structural separation of Time Warner Cable, under the right circumstances, is in the best interest of both companies' shareholders," CEO Jeff Bewkes said in a release.

The company also reported first-quarter earnings on Wednesday. Gains in its Turner cable networks and phone and broadband division were offset by slow ad sales at AOL and a decline in the Filmed Entertainment division.

Total sales for the period, which ended March 31, grew 2 percent from a year ago to $11.4 billion. Net profit fell 36 percent to $771 million, or 21 cents per share. That's down from $1.2 billion, or 31 cents per share, in the year-ago quarter, which included a boost from the sale of AOL's Internet access business in Germany.

As of March 31, the AOL service had 8.7 million U.S. access subscribers, down 647,000 from the prior quarter and down 3.3 million from the year-ago quarter. AOL's revenue fell 23 percent, or $330 million, to $1.1 billion for the three-month period just ended.

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