Seeking Alpha

AOL +8.1% on Q2 beat, ad improvement, new buyback

  • After dropping 1% Y/Y in Q1, AOL's search revenue rose 6% in Q2 to $98.9M. Display ad sales on AOL properties fell 1% to $144.1M, a smaller drop than Q1's 3%. 3rd-party platform revenue (boosted by last year's Adap.tv acquisition) rose 60% to $194.3M, better than Q1's 55%.
  • Subscription (dial-up ISP) revenue fell 7% to $155.1M after dropping 10% in Q1. U.S. subscribers fell 3% Q/Q and 9% Y/Y to 2.34M, but ARPU rose 7% Q/Q and 4% Y/Y to $20.86. Churn was 1.6%.
  • Average monthly unique visitors to AOL properties rose 18% to 171M, even as average monthly PC visitors fell 7% to 108M. Display ad sales on AOL properties were hurt by the loss of $15M in revenue from Patch and other "shuttered or de-emphasized brands;" they would've been up 9% otherwise.
  • $59M was spent on buybacks at an average price of $36.84, and a new $150M buyback has been authorized. Free cash flow grew 53% to $87.5M.
  • Q2 results, PR

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