AOL CEO Tim Armstrong Promises 2011 Will Be Comeback Year
NEW YORK - 2010 was a turnaround year for AOL, and 2011 will be its comeback year, chairman and CEO Tim Armstrong said Wednesday.
While the online firm will not return to advertising growth until the back-half of the year, Armstrong said his team remains focused on big instead of small, incremental improvements. "Our focus is really not on millions, but billions," he said.
His comments came after AOL reported fourth-quarter financials.
On the earnings conference call, Armstrong also once again touted his team's focus on boosting AOL's content and content traffic.
He mentioned, for example, that AOL overtook Hulu in terms of unique video views in the fourth quarter. And he cited such recent content deals as one with Heidi Klum as a sign of AOL's momentum.
Armstrong also explained why AOL recently outsourced most of its sports coverage and emphasized that some people wrongly interpreted that as a pullback from AOL's content aspirations.
"We focus on video and local news," while Sporting News is AOL's partner for regular sports coverage, he said. There are big companies, such as Walt Disney's ESPN, in the sports space, and to compete with ESPN, one "must be differentiated," Armstrong argued.
AOL's fourth-quarter revenue fell 26 percent from the same period a year earlier to $596 million, but profit rose from $1.4 million in the period a year earlier, which included $106.3 million in restructuring costs, to $66.2 million.
For the full year 2010, revenue fell 26 percent to $2.4 billion. A loss of $783 million for 2010 compared with a year-ago profit of $249 million. The loss came amid lower revenue and a big goodwill impairment charge announced last year.
"I am very proud of what we accomplished in 2010 as we began the year with a significant restructuring of AOL and ended the year with a significantly improved balance sheet, a number of exciting new products and a new culture focused on winning," said Armstrong. "We have set aggressive goals for ourselves in 2011 in pursuit of capturing the growing opportunity ahead of us.”