AOL Time Warner has said that the effects of the slowing advertising industry and the attack on the US two weeks ago are going to cause the company to miss its financial targets. The announcement is a further major indication of the hard times on which media companies are currently falling.
The media giant said that sales are likely to grow at a rate of around 5-7% this year, as compared with the original forecast of around 12%. Earnings will grow around 20% rather than the 31% that had previously been predicted.
Whilst the tragedy on 11 September did exacerbate things, advertising had already begun to slow even before the attack, the company said.
ABN Amro now expects AOL’s full year 2001 earnings to come in at around $10.05 billion, a reduction on the previous forecast of $10.2 billion. FY2002 earnings forecasts are reduced from $12.1 billion to $11.5 billion.
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