Time Warner Q1 Profit Dips 14.3%


Time Warner noted that ad declines reflected a shortfall at Turner’s international networks, “due in part to the impact of unfavorable foreign exchange rates,” as well as “a slight decline at its domestic entertainment networks, reflecting weakened demand.”

With respect to the remainder of the year, Time Warner noted that ad revenue growth at the networks arm “will continue to be challenging due to the difficult economic environment.”

Time Warner chairman and CEO Jeff Bewkes told investors that the Turner entertainment nets, which include TNT, TBS and Cartoon Network, are in “a very good position” on the eve of the upfront, noting that the cable brands enjoy competitive advantages in terms of “scale, reach, ratings and quality programming.” Bewkes also indicated that the CPM gap was narrowing, saying that top-tier cable nets now command unit pricing at about two-thirds the going rate for broadcast inventory.

In a statement released before Time Warner’s Wednesday morning earnings call, Bewkes said the quarterly results keep the company “firmly on track to achieve our full-year business outlook.” He added that Time Warner is “working to determine the right ownership structure for AOL.”

In early trading, Time Warner shares were up $1.47, or 6.6 percent, to $23.24.