The AOL Inc., a digital media company posted its revenue growth, better than expected as advertisers utilized the company’s automated platforms in buying and selling digital ads.
The company’s overall quarterly revenue jumped 12% to 626.8 million dollars, surpassing the average estimate of analysts of 623.5 million.
Its advertising revenue rose 18% to 473.4 million dollars, driven by a significant uptick in its sales from third-party platforms, wherein the company assists advertisers in placing dollars on further digital properties. However, company shares dropped 6% to 41.36 dollars on Thursday’s morning trade.
The company owns The Huffington Post, a media property, and Adap.TV, an automated advertising platform, being in the middle of a reversal process, moving away from subscription dial-up profits.
AOL is benefiting from the increasing trend of advertisers who are allocating more money on digital video. Other media companies posted weak ad revenue at their cable units this week. Other shifts came from poor ratings, which caused advertisers to find out digital video.
The company CEO Tim Armstrong said consumers are in quick motion towards web video, mobile, and streaming video products. The CEO reiterated that advertisers are allocating more TV money with digital video.
AOL’s net income jumped to 28.5 million dollars or 35-cent per share for the quarter. Excluding items, the company earnings were at 52-cent per share, meeting the analysts’ forecast.
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