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Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: Brewmeister who wrote (13506)	4/27/1999 10:20:00 PM
From: John F. Dowd	Respond to of 41369

TO ALL: When you compare these results to that of MSFT's one should not be surprised to see the market reaction. After all if a 43% YOY earnings improvement which amounted to 2bill. in quarterly earnings with no new products in the qrtr. couldn't excite the fickle market then why should we be surprised at the street's lack of enthusiasm over the AOL report. It appears that that the financial pundits do not like leaders at the present time. But wait a few days maybe one of them will pass wind and all that will change.JFD - longgg AOL

To: Brewmeister who wrote (13506)	4/28/1999 9:55:00 AM
From: xfiles	Read Replies (1) \| Respond to of 41369

I don't mean to nitpick but,... Briefing notes, <<Revenues rose 66% to $1.25 bln, above expectations in the $1.1-1.2 bln range.>> The problem is that the expectations were based on AOL ex-Netscape. And AOL standalone revs were $1079M. So as I stated in previous posts, revenues were fine, but they were NOT above most expectations. Sell-side analysts are well aware of this, but they are fudging the numbers in their reports. (See the posts of analyst reports provided here by Moon.) Similarly, Briefing (and nearly everyone else, as far as I can tell) states that <<Advertising and ecommerce revenues were $275 mln, well above expectations of $190 mln and nearly doubling the year-ago figure of $142 mln.>> Again, the AOL-only advert and commerce revs were $157M, plus AOL-only "other" revs of approx $53M, for a total of $210M. It's evident to me that the press release and the conf call intentionally obscured what the AOL-only numbers were, probably because the revs were pretty much inline with most models. The EPS was higher than models in part because of lower than modelled marketing expenses. The huffing in the lead of press release and on the call about "beating First Call" was unseemly. AOL is a great company, and the revenue and earnings growth were admirable. Unfortunately, the share price had much more than this factored into it. x.