AOL's Q1: Display Ad Revenues Finally Going Up, But Profits Are Down 86 Percent

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Our parent company AOL has just released its quarterly earnings for Q1 2011, and it’s a mixed bag (again).

Revenue came in at $551.4 million, which is better than most analysts had anticipated – the company was expected to earn $0.17 per share on revenues of $536.35 million. Actual earnings came in at $0.04 per share, down 86 percent.

Notably, global display advertising revenue grew 4 percent, marking the first quarter of year-over-year growth since Q4 2007 (!). Domestic display grew 11 percent in the quarter, or 6 percent excluding acquisitions.

Overall advertising revenue declined $40.6 million compared to Q1 2010, mostly due to lower third-party network revenue associated with shutdowns and reduced operations in Europe, in addition to the absence of revenue from Bebo and ICQ (which AOL sold in 2010).

Leaving aside those AOL-implemented initiatives, advertising revenue was essentially flat for the quarter, reflecting declines in search and contextual revenue but growth in display revenue and increases in Third Party Network revenue.

Among the notable things that happened at AOL during the first quarter: the company closed the acquisitions of goviral and The Huffington Post and aligned all of its content under the newly formed AOL Huffington Post Media Group, with Arianna Huffington as editor-in-chief.


aol q1 2011