Time Warner Inc posted higher-than-expected quarterly profit, and the media powerhouse raised its full-year earnings forecast in a sign that advertising sales at networks like CNN and TBS are showing life.
Third-quarter net income fell to $661 million, or 55 cents a share, from $1.07 billion, or 89 cents a share, a year earlier, the company said on Wednesday.
Profit after adjusting for special items was 61 cents a share. Analysts had forecast earnings of 53 cents a share, according to Thomson Reuters I/B/E/S.
Revenue fell 6% to $7.1 billion, roughly matching analysts' forecasts.
Chief Executive Officer Jeff Bewkes said the company's full-year results should be better than it previously expected.
“Time Warner is firmly on track to post solid results this year in spite of the tough economic environment,” he said in a statement.
Adjusted earnings per share should rise to at least $2.05, compared with $1.98 a year earlier and the analysts' forecast of $2.02.
In a pattern made clear in this week's rush of third-quarter results, those media companies with cable properties are finding their footing more quickly as the economy starts to improve.
Take Time Warner, for instance. At its cable networks, including Turner Broadcasting and HBO, revenue rose to $2.87 billion from $2.73 billion, thanks to higher subscription sales. Advertising sales fell, but only 1%, which will probably be taken as a sunny sign in the media industry.
Revenue dropped at Warner Bros and Time Inc publishing, the largest magazine publisher in the United States. It also fell at AOL, the Internet property that Time Warner is spinning off.
The company confirmed that the spinoff would occur in December. (Reuters)