America On-Line: will it survive ...? Message Board

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Technology Stocks : America On-Line: will it survive ...?

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To: Thomas C. Donald who wrote (4767)	9/11/1997 12:27:00 PM
From: jack rand	of 13594

OK. I'll bite. AOL's investment banker, Robertson Stephens, estimates that ANS non-AOL revenue in FY98 would be $100m with 10% pre-tax margins, or $10m. AOL now gives that up. AOL's Q4 ad/commerce revenue was $3.47 per month per sub. CSi's was $0.80. So, a possible initial incremental bogey is $3.47-0.80 = $2.67; or $8.01 per quarter. Times 2.6m CSi subs = $20.8 million gross Assume 50% margin =$10.4 million pre-tax In other words, the same amount forecast for ANS, but with many more `ifs', including timeline, and no further decline of the 2.6m CSi subs, which already are generating losses at rate of $56m/yr. What a deal!

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