Yesterday, Verizon Communications Inc. reduced the value of its AOL and Yahoo acquisitions by $4.6 billion, directly affecting beleaguered Oath, home to various media properties,
including HuffPost and Engadget.
According to Bloomberg, the move signals that Verizon Media Group/Oath, which it was renamed in early November during restructuring at Verizon, hasn’t been able to remain competitive in bids for digital advertising. That's led to losses in revenue and profit.
The reduction in value wipes out nearly half of Verizon Media Group/Oath value.
Verizon has spent around $9.5 billion over the past three years in its attempt to build up its media wing and others. The division still has approximately $5 billion of assets and has a goodwill balance at around $200 million, according to Bloomberg.
Oath, conceived by former Verizon executive Tim Armstrong — who vacated his position as CEO earlier this fall — has been quietly scaled back recently as Verizon restructured the company.
Earlier this month, Oath was fined $5 million due to violations of the federal Children’s Online Privacy Protection Act after AOL was accused of taking part in “billions” of auctions for ad space appealing to children under the age of 13.
In November, Oath’s Tumblr platform was removed from the App Store because of the presence of child porn. Since then, Tumblr has announced that no adult content will be permitted on the platform.
However, the division has also embraced new ad inventory this year, including programmatic audio ads and metrics. National Geographic used Oath’s programmatic VR Ads to promote its latest season of Mars.
Yahoo Finance has also introduced new products, including a subscription service and a soon-to-launch standalone Apple TV App.