Peter Kafka

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Exclusive: AOL’s Tim Armstrong Says He Doesn’t Want a Yahoo Deal (Video)

Tim Armstrong felt good enough about his Q3 results to host two calls today: One with Wall Street, and another with the media. And the AOL CEO also let me drop by HQ with my shakycam and film a quick interview.

Important points from our chat:

  • AOL’s domestic display-ad sales — a key metric for the company — were up 14 percent, but those numbers include new revenue from the Huffington Post and TechCrunch, both purchased in the last year. If you stripped those acquisitions out, domestic display would be up 4 percent — down from 6 percent last quarter.
  • AOL’s traffic, meanwhile, which includes Huffington Post and TechCrunch, has flatlined. Armstrong says that’s in part because his access business is declining (once people stop paying for AOL, they visit less often) and, in part, because of integration issues. But he predicts that number will tick up again.
  • Asked to identify AOL’s key competitor, Armstrong passed, and instead offered “the usual suspects”: Yahoo, Google and Facebook.
  • What’s up with Yahoo? I expected some squirming from Armstrong on this one, and if you watch the video, you’ll see he never denies that he has talked to Yahoo about some kind of deal, or bankers, or whatever. But he also insists that he wants to keep the company independent, which is as close to a denial as we’re going to get.

Here’s my quickly edited transcript of that discussion (I’ve paraphrased my questions, but quoted his answers), which kicks in around the 3:35 mark.

Me: So what’s going on with Yahoo? Are you talking to them?

Armstrong: “… when I think about our company and where our future is, and those things, it’s really as an independent entity, and being very focused on our core strategy.”

Me: Ah. So you want to be a standalone company, and you don’t want to merge with Yahoo. Right?

Armstrong: “From our results today, and from what you’ve heard me say publicly, and what we’re focused on, the answer is yes.”

Wall Street seems to share Armstrong’s enthusiasm, at least for today: Shares are up 11 percent in morning trading.


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