The 10-second takeaway
For the quarter ended March 31 (Q1), Time Warner beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share contracted.
Gross margins contracted, operating margins improved, net margins contracted.
Time Warner notched revenue of $6.98 billion. The 27 analysts polled by S&P Capital IQ predicted a top line of $6.82 billion on the same basis. GAAP reported sales were 4.4% higher than the prior-year quarter's $6.68 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.67. The 30 earnings estimates compiled by S&P Capital IQ forecast $0.64 per share. GAAP EPS of $0.59 for Q1 were 1.7% lower than the prior-year quarter's $0.60 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 43.0%, 120 basis points worse than the prior-year quarter. Operating margin was 19.6%, 20 basis points better than the prior-year quarter. Net margin was 8.4%, 140 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $7.12 billion. On the bottom line, the average EPS estimate is $0.67.
Next year's average estimate for revenue is $29.37 billion. The average EPS estimate is $3.18.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,064 members out of 1,250 rating the stock outperform, and 186 members rating it underperform. Among 325 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 286 give Time Warner a green thumbs-up, and 39 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Time Warner is outperform, with an average price target of $42.18.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.