AOL (NYSE:AOL) shares surged by double digits on Tuesday after reporting better-than-expected financial results for the third quarter, as the the Internet company received a boost by advertising revenue.
Before the opening bell, AOL announced that net income came in at $20.8 million (22 cents per share), compared to a net loss of $2.6 million (2 cents per share) a year earlier. Analysts were expecting earnings per share of about 18 cents. Total revenue for the quarter was flat at $531.7 million, but higher than the average estimate of $521.6 million.
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Global advertising revenue jumped 7 percent to $340 million, compared to $318 million in the third quarter of 2011. It was the sixth consecutive quarter of year-over-year growth, and the main driver for the best year-over-year revenue performance in more than 7 years.
“We just reported the best relative revenue performance in seven years and the second consecutive quarter of year-over-year profit growth, exceeding our expectations,” said Tim Armstrong, chief executive officer. “We have positioned AOL for growth in 2013 and beyond with consumer and advertiser demand growing for our premium content and innovative products, video, services and ad formats.”
Wall Street cheered the results, as shares of AOL climbed more than 14 percent higher in afternoon trading, making a fresh all-time high above $40. Other well-known Internet companies such as Google (NASDAQ:GOOG) and Yahoo (NASDAQ:YHOO) traded less than 1 percent higher. IAC/InterActiveCorp (NASDAQ:IACI), a leading media and Internet company comprised of over 150 brands and products, gained about 2 percent.
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