AOL gets hurt - $54.2b loss

[Sckott]

http://money.cnn.com/2002/04/24/technology/aol/index.htm

This will effect a lot of us, I'm afraid.....

[Dan C]

Interesting that AOL's internet service is dragging them down while publishing and recording actually made money. Sadly, that's where AOL's suits have been slashing budgets and staff, along with CNN.
I wonder if that'll change much.
Goodbye LIFE magazine, hello 'instant messaging'. Yeah, good business.:rolleyes:
Dan C

[GabeG]

This loss was actually announced back in January. There are rumours about that AOL may be spun out of the company.

[RDK]

So AOL-Time Warner will once again become AOL and Time Warner???

;)

[Ronald]

I wouldn't be concerned. It all has to do with accounting changes coming into place this year. In the past companies were able to amortize losses up to 40 years. This year, that loophole has been closed. The $54.2 MMM loss is due to the $106 MMM AOL and Time Warner merger.

The old rules governing accounting for mergers and acquisitions allowed companies to understate the value of their purchases and inflate earnings. With closure of the loophole, investors have a better feel for the true value of a company.

[peterredtrumpet]

And, in one of the conundrums of capitalism, I noted that AOL's stock rose the day they announced that loss.

Take it easy!
Peter

[jligon]

While the economist in me may show some conern, I can't help but smile when I read a story like this. I HATE AOL. Anyone that has tried to cancel their service knows why.
Maybe if they stopped sending me those CD-Roms in the mail every week, they wouldn't have been doing so bad. :)
I have a tough time being sympathetic to any of those HUGE Companies (AOL-Time Warner-ABC-Disney...)

[Joe Koz]

Now it would be time to buy AOL...........

[Mike V]

Originally posted by Ronald
I wouldn't be concerned. It all has to do with accounting changes coming into place this year. In the past companies were able to amortize losses up to 40 years. This year, that loophole has been closed. The $54.2 MMM loss is due to the $106 MMM AOL and Time Warner merger.

The old rules governing accounting for mergers and acquisitions allowed companies to understate the value of their purchases and inflate earnings. With closure of the loophole, investors have a better feel for the true value of a company.

This is absolutely right! AOL may have the most newsworthy numbers here, but look around and you will see the impact of these accounting rules on many companies throughout the market.

[Mike V]

Originally posted by Joe Koz
Now it would be time to buy AOL...........

I wouldn't touch it at this price with a 20 foot pole. Unless, of course, "irrational exuberance" is back with a vengeance!