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AOL: Financial Impact of Cost Cuts

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Published By:

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Silicon Alley Insider

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Mar-05Jun-05Sep-05Dec-05Mar-06Jun-06Sep-06Dec-06Mar-07Jun-07Sep-07EDec-07EMar-08EJun-08ESep-08EDec-08E20072008

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SUBSCRIPTION REVENUE$1,774$1,734$1,665$1,582$1,538$1,546$1,455$1,245$873$691$540$432$393$346$324$302$2,536$1,365

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Y/Y Change-13%-11%-13%-21%-43%-55%-63%-65%-55%-50%-40%-30%

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ADVERTISING REVENUE$311$320$328$379$392$449$479$566$549$522$551$651$631$600$633$749$2,273$2,614

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Y/Y Change26%40%46%49%40%16%15%15%15%15%15%15%

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OTHER REVENUE$27$25$29$28$27$32$30$27$36$40$33$30$40$40$40$40$139$160

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Y/Y Change0%28%3%-4%33%25%10%10%10%10%10%10%

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TOTAL REVENUE (Includes "Other")$2,112$2,079$2,022$1,989$1,957$2,027$1,964$1,838$1,458$1,253$1,124$1,113$1,064$986$997$1,091$4,947$4,138

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Y/Y Change-7%-3%-3%-8%-25%-38%-43%-39%-27%-21%-11%-2%

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Seq. Change4%-3%-6%-21%-14%-10%-1%-4%-7%1%9%

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PROFITS

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Costs$1,599$1,563$1,569$1,666$1,530$1,533$1,410$1,543$916$768$768$768$600$600$600$600$3,220$2,400

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Adj. EBITDA$513$516$453$323$427$494$554$295$542$485$356$345$464$386$397$491$1,727$1,738

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Y/Y Change-17%-4%22%-9%27%-2%-36%17%-14%-20%12%42%1%

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Seq. Change16%12%-47%84%-11%-27%-3%35%-17%3%24%

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Margin24%25%22%16%22%24%28%16%37%39%32%31%44%39%40%45%

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EBITDA From "OTHER" (Est.)$30$30$30$30$30$30$30

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NET EBITDA$455$326$315$434$356$367$461

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% NET EBITDA from SUBSCRIPTION (Est.)76%76%76%76%76%76%76%

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% NET EBIDTA from ADVERTISING (Est.)24%24%24%24%24%24%24%

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SUBSCRIPTION EBITDA$346$248$239$196$173$162$151$833$682

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% of Subscription Revenue*50%46%55%50%50%50%50%

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ADVERTISING EBITDA$109$78$76$237$183$205$310$263$936

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% of Revenue21%14%12%38%30%32%41%

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Published By:

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Silicon Alley Insider

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Blue = Assumptions

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Red = Estimates

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*Estimate from Parsons' comment on 9/18 that subscription is "majority" of profit and other proprietary research.