AOL’s Profit Doubles, Beating Expectations; Amazon.com Posts Loss
America Online Inc.’s profit more than doubled in the latest quarter as the world’s largest Internet service signed up 755,000 new subscribers and advertising revenue surged.
The largest retailer on the Internet, Amazon.com Inc., posted a loss on pumped-up spending to promote and expand its services, while revenue nearly tripled. Amazon.com also said it will split its stock 2-for-1 on Sept. 1.
AOL, which continues to outpace its rivals in the fight for new subscribers, said it earned $156 million, or 13 cents a share, in its fiscal fourth quarter, excluding acquisition costs. A year earlier, it had pro forma profit of $58 million, or 5 cents.
The profit performance exceeded analysts’ estimate by 2 cents and met the so-called whisper number of 13 cents a share.
Revenue jumped 46% to $1.38 billion. Revenue from advertising and electronic commerce nearly doubled to $306 million from $164 million.
AOL said its members spent an average of 52 minutes each on its flagship service every day, contrasted with 44 minutes a day a year ago. Revenue from its monthly subscription fee jumped 39% to $943 million.
Amazon.com said its second-quarter loss widened to $82.8 million, or 51 cents a share, excluding merger-related expenses, from $17 million, or 12 cents, a year earlier. The performance matched the estimate of analysts polled by earnings tracker First Call, which ranged from 49 cents to 53 cents. Unofficial estimates ranged from a loss of 40 cents a share to 49 cents.
Revenue climbed to $314.4 million from $116 million, putting it within the range of $306 million to $325 million analysts expected.
Amazon.com’s number of registered customers soared to 10.7 million from about 3.14 million a year ago.
Marketing and sales costs more than tripled to $85.9 million, while product development expenses quadrupled to $14.5 million.
AOL and Amazon.com, along with several other technology-related companies, reported results after the close of U.S. markets.
At a Glance
Other industry earnings, excluding one-time gains and charges unless noted:
* Beyond.com Corp. reported a second-quarter loss of $21.9 million, or 62 cents a share, slightly smaller than the 65 cents analysts expected, as revenue more than tripled to $26.3 million from $7.6 million.
* Broadcom Corp. said its pro forma net income before one-time charges for acquisitions and legal settlements rose to $21.2 million, or 19 cents a share, from $4.9 million, or 5 cents, a year ago. That beat analyst forecasts of 16 cents and narrowly missed the so-called whisper number of 20 cents. The Irvine-based company’s revenue more than doubled to $116.3 million from $45.2 million.
* Go2Net Inc. had pro forma net income of $3.06 million, or 7 cents a share, in its fiscal third quarter, 2 cents higher than estimates, contrasted with a loss of $160,831, or 1 cent, a year ago. Revenue nearly tripled to $5.73 million from $1.97 million.
* LSI Logic Corp. posted second-quarter profit of $31.2 million, or 21 cents a share, before acquisition and other costs, down 4% from a year earlier but better than the 18 cents analysts expected, as revenue jumped 49% to $501 million.
* Silicon Graphics Inc. reported an unexpected operating profit for the fiscal fourth quarter of $22 million, or 12 cents a share, contrasted with a loss of $57 million, or 31 cents, a year ago, with a boost from cost cutting. Sales rose 7% to $828.6 million. Analysts expected a loss of 5 cents.
* Sybase Inc.’s net income climbed to $14.3 million, or 17 cents a share, in the second quarter from $450,000, or 1 cent, a year ago, beating expectations of 10 cents, on lower expenses. Revenue slipped 3.5% to $210.2 million.
* Western Digital Corp. reported an operating loss of $81.5 million, or 90 cents a share, for the fiscal fourth quarter, in line with its June warning, amid price cutting in the disk drive industry. Revenue rose 9% to $709.3 million. Analysts were expecting a loss of 95 cents.
