Time Warner Posts Its First Yearly Profit : Earnings: The milestone comes after successive losses since the giant company was created in a 1989 merger.

Boosted by improved results in all areas, Time Warner Inc. earned $86 million in 1992, the first annual profit for the world’s largest media and entertainment company since the 1989 merger of Time Inc. and Warner Communications Inc.

Although small for a company with Time Warner’s $13.07 billion in annual revenue, a profit of any kind marks a milestone for the debt-laden company, reflecting record results in its music, filmed entertainment, cable and HBO areas.

Time Warner’s fourth-quarter profit totaled $68 million on revenue of $3.7 billion, compared to a profit of $45 million a year earlier on revenue of $3.4 billion.

Despite the improved results, analysts still appear to have mixed feelings about Time Warner’s stock.

Oppenheimer reiterated a buy recommendation Monday. Last week, A. G. Edwards downgraded the stock to a hold from a buy.

Time Warner closed unchanged, at $34.40 a share Monday in trading on the New York Stock Exchange.

Time Warner’s 1992 results contrast with a loss of $99 million in 1991.

Despite being in the black in 1992, earnings per share showed a loss of $1.46, reflecting large payouts to holders of preferred stock.

The company lost its visionary leader, Chairman Steven J. Ross, in December.

In the last few weeks, Time Warner has been moving aggressively to revamp its balance sheet by replacing high-cost debt and preferred stock with cheaper debt.

Time Warner also made progress in 1992 when its senior debt achieved investment grade ratings.

Time Warner’s film entertainment earnings before taxes and interest set a record at $410 million, up from $390 million a year earlier.

The company’s Warner Bros. unit captured the top spot among studios in domestic box office share with such hit films as “Batman Returns,” “Lethal Weapon 3,” “Unforgiven” and “The Bodyguard.”

Warner Bros. edged out Walt Disney Co. to capture the top domestic box office share with 19.8%, according to the Hollywood trade paper Variety. The company’s video unit, boosted by such releases as “Batman Returns,” also had a strong 1992.

Time Warner’s record division saw its earnings before taxes and interest rise to $585 million from $560 million a year earlier, with sales led by such artists as Eric Clapton, Madonna, Metallica and En Vogue.

Cable profits were especially strong, rising 12% to $977 million. Time Warner Cable boosted its number of subscribers last year to 7.1 million, from 6.7 million in 1991.

Time Warner’s HBO division had earnings of $215 million, up from $195 million a year earlier, which the company said reflected increased results from domestic pay television services offset by investment spending on HBO ventures in such areas as Latin America and Singapore.