Cable, TV Units Bolster Time Warner Q1 Profit

May 4, 2005  •  Post A Comment

Media giant Time Warner on Wednesday reported a slight increase in revenue and profit for the first quarter as gains at the company’s cable and networks units offset revenue declines at the America Online division.

Time Warner’s profit rose to $963 million from a year-earlier profit of $961 million. Revenue climbed 3 percent to nearly $10.5 billion.

The company’s cable unit proved once again to be a main growth driver, delivering 10 percent revenue growth to $2.2 billion thanks to a 10 percent rise in subscription revenue and a 9 percent increase in advertising revenue. The division reported a 19 percent jump in high-speed data revenue as well as a 21 percent bounce in revenue associated with advanced digital video services. The unit’s burgeoning phone business posted strong gains as well.

At Time Warner’s networks division, which includes TNT, TBS and HBO, revenue rose 4 percent to $2.3 billion. Subscription revenue at Turner Broadcasting and HBO rose 9 percent, while advertising climbed 12 percent at Turner. That offset a 5 percent decline in advertising revenue at The WB Network, which has struggled in the ratings this season.

Strong international television sales and home video releases were offset in part by difficult year-ago comparisons, when the filmed-entertainment operation received a revenue bounce from the third-cycle syndication of the TV series “Seinfeld.”

Last month Time Warner, along with Comcast, agreed to purchase bankrupt cable operator Adelphia Communications. The sale, when completed, will increase the number of cable subscribers at Time Warner Cable by 3.5 million customers.