| MUMBAI:
Time Warner's third quarter operating income has taken a hit due to lower revenues
at the AOL, publishing and filmed entertainment segments which more than offset
growth at the networks segment. Revenue
at $7.1 billion fell by six per cent from the third quarter of 2008. Operating
income decreased by 10 per cent to $1.4 billion.
For
the Content Group (which consists of the Networks, Filmed Entertainment, Publishing
and Corporate segments), revenues were down by three per cent, Adjusted OIBDA
decreased by one per cent and operating income declined by two per cent. Time
Warner chairman, CEO Jeff Bewkes says, “I am confident that the new content-focused
Time Warner will be well positioned to deliver steady and attractive stockholder
returns in 2010 and beyond." At
Turner Broadcasting and HBO, revenues rose by five per cent ($143 million) to
$2.9 billion, with nine per cent growth ($163 million) in subscription revenues.
This was partially offset by a 12 per cent decline ($27 million) in content revenues
and a one per cent decrease ($4 million) in ad revenues. Subscription
revenues benefited primarily from the impact of the consolidation of HBO Latin
America Group , as well as higher subscription rates at both Turner and HBO, partly
offset by the unfavourable impact of foreign exchange rates at Turner. Content
revenues decreased due to lower ancillary sales of HBO’s original programming,
offset in part by the effect of lower than anticipated home video returns of approximately
$25 million. Ad
revenues reflected a decline at Turner’s news networks and the unfavorable
impact of foreign exchange rates, partially offset by an increase at domestic
entertainment networks. At
the film division revenues declined by four per cent ($101 million) to $2.8 billion,
due primarily to lower revenues from home video and interactive games, and the
unfavorable impact of foreign exchange rates.
Theatrical film revenues from third-quarter 2009 releases, such as Harry Potter
and the Half-Blood Prince and The Final Destination, as well as carryover
from The Hangover, were slightly lower than in the prior year quarter,
which benefited from the success of The Dark Knight. At
AOL revenues were down by 23 per cent ($235 million) to $777 million, resulting
from a 29 per cent decline ($138 million) in subscription revenues due to continued
subscriber losses and an 18 per cent decrease ($92 million) in ad revenues. The
decline in ad revenues was due primarily to lower paid-search and display advertising
on AOL Media, reduced sales of advertising on third-party Internet sites and the
unfavourable impact of foreign exchange rates. | 
