Financial Focus: Big Media Takes A Big Dive

Last week wasn't the best to be a big media company on Wall Street. Three of the biggest were among the most active stocks Friday--and not in a good way.

The big tremor came Thursday when Pixar Animation Studios said it would walk away from its mega-partnership with Walt Disney Co., which led to such hits as "Toy Story" and "Finding Nemo." That isn't happy news for the Magic Kingdom, which has been a darling of media stocks. It also puts more pressure on Disney's ABC, which has seen great success with ESPN but is still trying to find its way with the broadcast network. Disney dropped 45 cents (1.84 percent) to $24 on heavy trading Friday.

Time Warner turned an annual profit, but also gave investors the willies with its inability to stop the bleeding at AOL and results that didn't show as much strength elsewhere as many had hoped. More than 26 million shares of Time Warner changed hands Friday, with the stock ending down 1 percent to $17.57 a share when all was said and done. General Electric, which owns NBC and will soon own Vivendi Universal, also dropped 1 percent to $33.63 on volume of 17.1 million shares. Viacom, whose network CBS had a big day yesterday with the Super Bowl, dropped just about 1 percent to end the day at $40.57. Yet News Corp.--which owns Fox among other assets--landed in positive territory, up 32 cents to $36.82.



Wall Street continued to react to last week's earnings reports from the interactive sector, too. One Internet marketing firm reaped the benefits of a good quarter, and a competitor did well but surprised investors by predicting a quarter that would not be as lucrative as analysts had hoped.

DoubleClick shined in its Wednesday earnings release, which reported its first full year of profitability and a quarter that was a vast improvement over the fourth quarter of 2002, when it was still losing money. DoubleClick was also positive about the new year, predicting it would have about $300 million in revenue in 2004. It was rewarded with a 15 percent boost in share price on Thursday and another 1 percent rise on Friday, when it closed at $12.02.

Contrast that to aQuantive Inc., which owns agency Avenue A and research company Atlas DMT. aQuantive reported $63.9 million in revenue in the fourth quarter, a healthy 44 percent more than a year ago. So far, so good. But when the company said it would have first-quarter revenue between $17 million and $19 million, that's when the trouble began. Shares in aQuantive fell 20 percent when the market opened Thursday and ended the day down 11 percent. The slide continued--ever so slightly--Friday, when aQuantive closed at $11.30, down 17 cents.

Other interactive companies felt the slap or tickle of investors by the end of the week.

Shares in Amazon, which ended 2003 as its first year in the black, was up $1.18 to $50.40 on volume of 11.41 million shares. CNET, which also got into the black for the first time, was up $2.56 to $10.75 on volume of 16.6 million shares.

And RealNetworks dropped 55 cents to close at $5.59, well below its 52-week high of $9.29. It said Thursday that it had lost $5.53 million in the fourth quarter, compared to $2.45 million a year ago. It has been laid low by $1.6 million in costs in its antitrust lawsuit against Microsoft.

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