Jan. 7 (Bloomberg) — Time Warner Inc., the owner of HBO and AOL, will report its first annual loss in six years after writing down the value of its cable-system, publishing and Internet assets by about $25 billion in the fourth quarter.
The shrinking U.S. economy hurt advertising at the AOL and publishing units more than anticipated, the world’s largest media company said today in a statement. A $281 million verdict against its Turner Broadcasting System and the bankruptcy of Lehman Brothers Holdings Inc., a tenant in the Time & Life building, also hurt results.
“It’s a little startling they didn’t have a handle on this decline in advertising,” said Fred Moran, an analyst at Stanford Financial Group in Boca Raton, Florida. “The trends were readily available, so this downward adjustment is definitely surprising.”