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May 6, 1997updated 05 Sep 2016 12:40pm


By CBR Staff Writer

America Online Inc, expected to lose the equivalent of $0.07 per share according to the First Call consensus, reported net income for the third quarter – the first full quarter since the introduction of flat-rate pricing – of $2.6m, or $0.02 per share, on revenue which surged 46% to $456.2m. The company says that while it incurred a variety of unusual costs associated with the switch to flat-rate pricing, including the settlement of class action suits resulting from overloaded access lines, it managed to eke out a profit primarily due to lower marketing expenses. Non-subscription revenues for the quarter nnearly tripled to $74.7m, with advertising and electronic commerce revenue supplying $60.7m, compared to $15m last time. Subscribers remained essentially flat at eight million. For the corresponding quarter last year, the company posted net income of $25.2m, or $0.14 per share. For the year-to-date, net loss was $505.9m on revenue up 60% at $1.22bn, compared to net income of $35.6m, or $0.13 per share, last year.

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