First Call consensus expected the world's largest online service provider to earn 11 cents a share in the quarter. The $1.4bn in sales represents a 46 percent improvement versus the year-ago quarter when it earned $58m, or 5 cents a share, on sales of $943m.
In the quarter, AOL added 755,000 new members, bringing its new customer total for the year to more than 5.1 million users. AOL now has more than 17.6 million subscribers. Though those growth figures are impressive, they fell a tad below most analysts' estimates of between 775,000 to 800,000 new subscribers.
For the year, AOL made $396m, or 34 cents a share, on sales of $4.8bn compared to a profit of $59m, or 6 cents a share, on sales of $3.1bn in the fiscal 1998. Its advertising and e-commerce sales soared to $306m, up 87% over fiscal 1998's fourth quarter. "This has been a year of tremendous growth and achievement," said CEO Steve Case in a prepared release. "As we prepare to usher in a new century that will in large part be defined by the emergence of a connected society, America Online is better positioned than ever to lead the way."
Last quarter, AOL beat Street estimates, earning $117m, or 11 cents a share, on sales of $1.3bn. Despite beating estimates by 2 cents a share, it's doubtful whether fickle AOL investors will give the stock much of a push in Thursday trading.
After peaking at 175 1/2 in April, the stock fell below $100 in June. Of course, the stock has twice split 2-for-1 since bottoming out at 17 1/4 in August. Thirty-six of the 37 analysts following the stock maintain either a "buy" or "strong buy" recommendation.