US media and entertainment giant Time Warner posted a 38% decline in quarterly net profit today, dragged down by weak results in its publishing division and at Internet unit AOL.
Time Warner said net profit fell to $661m, or 55 cents per share, in the third quarter from $1.1 billion, or 89 cents per share, in the same quarter a year ago. Revenue declined 6% to $7.1 billion.
But Time Warner still raised its outlook for full-year earnings, saying it expected earnings per share of at least $2.05, up from the $1.98 forecast previously.
The improved full-year outlook came despite what Time Warner said will be $100 million in restructuring charges in the fourth quarter in the struggling publishing division.
According to the New York Post, Time Incorporated, publisher of Time, Fortune, Sports Illustrated, People and other magazines, plans to lay off some 540 employees, or 6% of its workforce.
Time Warner did not provide any details about the restructuring in its third-quarter earnings report.
Time Warner chairman and CEO Jeff Bewkes said the company 'is firmly on track to post solid results this year in spite of the tough economic environment'.
'Driven by the better than expected performance at our Content Group this quarter, we're raising our 2009 business outlook,' he said in a statement. 'We still expect to spin off AOL by the end of the year, and we're making great progress on our other longer-term strategic priorities,' he added.
Revenue at Time Warner's networks division, which includes television channels CNN, Turner Broadcasting and HBO, rose 5% to $2.9 billion. Revenue fell 4% to $2.8 billion at the film division as third-quarter releases such as 'Harry Potter and the Half-Blood Prince' failed to enjoy the same success as last year's hit Batman film 'The Dark Knight'.
In the publishing division, revenue fell 18% to $914m. Advertising revenue dropped 22% and subscription revenue declined by 13%. Revenue was down 23% at AOL to $777m. Subscription revenue fell 29% and advertising revenue declined by 18%.
Like other US magazine publishers, Time has been facing a steep drop in print advertising revenue, steadily declining circulation and the migration of readers to free news online.
Time cut around 600 jobs last year and has closed several magazines recently including Southern Accents and Life. It also cut the frequency of Fortune magazine to 18 issues a year from 25.
