Liveblogging Time Warner Q1 earnings conference call

Dick Parsons is saying that AOL is continuing on track on its turnaround and is being thought of as very successful inside the company. The cable unit, according to Parsons, is the one that still has the best growth growth. Parsons also said that AOL is going to be able to grow its page views going forward. Parsons isn't happy about being down net at Time Inc but the digital revenues are making up for it. The company expects to be finished with the share buyback plan by the end of Q2.

Now the company is going over the slides and this has been summarized above. There will be updates for the Q&A session, but there will be updates for any key data not noted in the slides.

Q&A Session and more data to follow........shares are up 2% at $21.05 as of this point.

Advertising was noted as a key driver for AOL growth. The company is also reminding that Q2 will show the largest OIBDA drop and the remainder of 2007 will have a higher drop. The company is skimming over CABLE results because of the prior conference call and results (See the liveblogging link here).
http://www.bloggingstocks.com/2007/05/02/liveblogging-time-warner-inc-q1-earnings-conference-call/

Film revenues dropping 1% were due to home release drops and difficult comparable movies. Lower home video revenues were partially offset by higher worldwide television distribution. It expects a sharp drop in video OIBDA in Q2 and then a solid ramp back up in the second half. (10:58 AM)

Q&A SESSIONS:
QUESTION (Mitchellson at Deutsche Bank): what is going on with the Braves divestiture and what about the AOL strategy going?
Jeff Bewkes will follow Parson. Parsons: the company and Braves and Liberty are in a letter of internt and MLB has to approve it. On AOL: Bewkes said that the company is interested in investing resources for solid returns and AOL is a candidate for investment inside the company (he didn't say OUTSIDE, worth a note). With pageviews growing, they are very interested in investing further and noted the attempt to buy TradeDoubler in Sweden.

QUESTION (Cohen of Merrill Lynch): on cable about owning a smaller piece after Cablevisions announcement of going private? And where is pricing pressure? Parsons said that the company likes the cable business and its strength. It now has a "currency" and he noted that the cable space is inevitably going to consolidate (and they are well positioned for that). So, maybe TWC would do a deal, and it even noted Cablevision down the raod. (11:06 AM)

QUESTION (Swindberg?, no firm named) On DVR ratings and programming and investment decisions? The comapny isn't worried about it too much. As for networks theya re having a good year. THe NBA playoffs are helping, as is TNT and TBS, and AdultSwim. (11:10 AM)

QUESTION (Wang of Bear Stearns): on AOL Advertising, about up 25% and 19% net, why is there a deceleration? it was seasonality to blame. AOL wants to still grow at or above industry. (11:11 AM)

QUESTION (Yuna Amobi of S&P): 1) to Parsons, what about DoubleClick & Google, how does it affect the advertising.com and relationship with Google? 2) what is bias on more buybacks or dividend hikes down the road, or debt reduction?
Parsons: AOL and Google are partners, the Google-DoubleClick deal is expected to see Google honer the deal without much change; partnership, according to Parsons, is going very well....On the bias toward allocating capital, Parsons says he wants to get through the program by end of Q2 and then the board will go over the return of capital policies. The company remains comfortable with a 3-1 leverage on the balance sheet. On dividends and buybacks, the company will be alert on all fronts plus acquisitions. Parsons said they remain confident tha a dividend hike MAY be the way. 11:16 AM

QUESTION (Masonson? of Bernstein): on subscribers, are the losses lower than expected? Bewkes: That is true, now there are 8 million free accounts since August, and the decline in paying subscribers it has stabilized and is declining slower than originally thought. They want more users and learning more from migration of users. The usage pattern is going up. New product features and tools shoulkd bring in even more users (11:19 AM)

QUESTION (Noto of Goldman Sachs): On AOL advertising with 35% growth rate being lower growth, is this a deceleration of sell-throughs going to take the growth under 25%-30%? Bewkes: there is enough left in ad inventory, and pageviews they think are going to go up with everything else. He doesn't see a concer,

QUESTION (Morris, of UBS) On AOL, how did decline go compared to expectations? Would they consider a sale to monetize subscribers? Bewkes: The migration of AOL dial up to broadband was a little better. The rates are higher than planned and good. AOL's new users that are not from migration is also better than planned. They want key distribution partners with an aim of customer relationships. Of course a separation is possible via sale, but they would have to have super strong relationship. Parsons says the focus is execution. (11:27 AM EST)

LAST QUESTION (Cathy...of Prudential) On cable, the results look good from rental versus sell-through, and what are lock-ups with Netflix and Blockbuster?
It is too early to lay out what the results are showing, but it seems positive and looks good so far. The results are positive because of rentals rather than sell-throughs, but they cant specify yet. (11:29 AM)

END OF CALL........Time Warner Inc. (TWX) shares now up 2.8% at $21.16.

First, sorry for any analyst name butchering. Many rushed through their names so it was not easy to recognize them all. The call all in all went very smoothly and all the questions were answered except for a few points that don't seem to have any one single impact on the bottom line.

Jon Ogg is a partner at 24/7 Wall St.; he does not own securities in the companies he covers.