Like an America Online busy signal circa 1996, it took awhile to get connected. But the truth at AOL Time Warner
This comes after an internal review turned up accounting inaccuracies in the way it recorded some advertising and commerce transactions. While the amount is significant, the restatement itself was not a surprise, as AOL Time Warner's integrity had been hounded by SEC allegations.
The company also reported earnings of $0.19 a share before charges for the third quarter. While that was a nickel off last year's showing, it was in line with Wall Street expectations. It continues to be dogged by weakness at its America Online service, where ad revenue fell for the fourth consecutive quarter.
Nailing watered-down projections and taking a vat of correction fluid to past financials might not amount to much of a moral victory, but the investing community is taking the news well. The stock traded a buck higher in after-hours trading yesterday, on the heels of the report.
With the stock trading for less than what the company paid for all of Time Warner two years ago, the gray clouds may finally be passing for AOL, as investors begin to value the conglomerate's vast assets at a time when entertainment is a necessary commodity.