AOL Exhibits Solid Q4 Growth

Still, display sales for core properties remain a weak spot

AOL’s revenue increased for the first time since the second Bush administration. Its global ad business jumped 13 percent in Q4 to $410.6 million. The company’s AOL Networks division, which houses recently rebranded group, saw revenue jump 37 percent to $183.5 million. 

All in all, it was a pretty solid quarter for the company, which CEO Tim Armstrong said showed real “momentum” and was on “a growth path” for 2013.

However, there are some challenges areas for AOL, on top of the fact that its cash-cow dial-up business continues to dwindle (albeit less quickly than in the past).

According to AOL’s Q4 earning report released Friday morning, the company enjoyed 6 percent growth in unique visitors year over year in Q4. That’s not insignificant growth for such a legacy brand. Yet revenue for AOL’s Brand Group, which houses owned-and-operated properties ranging from Moviefone to The Huffington Post, saw growth of 4 percent, netting out at $213 million in revenue in Q4.

Even more concerning for AOL was the fact that its global display revenue was flat, while its domestic display revenue dipped 3 percent. Armstrong and his team have made AOL’s media business, and innovative display advertising, a centerpiece in the company’s turnaround strategy. Plus, during his tenure Armstrong has engineered the purchase of more "premium" brands, such as HuffPo and TechCrunch.

On the plus side, AOL has a ton of cash on hand for future investments or acquisitions: $466.6 million. The company also announced it would repurpose $100 million in common stock to strengthen its foundation.

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