Time Warner AOL (TWX): More Firings Coming?*

Say it ain’t so.  We thought we were done with firings at AOL, but a comment Dick Parsons made on today’s conference call makes it sound like we’re not. 

An analyst asked what Time Warner was going to do to get AOL’s cost structure under control.  New CEO Jeff Bewkes said Time Warner is looking for EBITDA growth at AOL next year (which shouldn’t be surprising, given the recent 25% cost cut).  Old CEO Dick Parsons added (we’re paraphrasing): “And we haven’t played the last card in the AOL cost-cutting deck.”

Now, it’s possible that Dick meant that the last round of mass firings hasn’t hit the P&L yet.  (It will in Q1).  It’s possible he meant that many of those axed on the October 16 D-Day haven’t left the company yet.  But it’s also possible, unfortunately, that he meant that AOL really hasn’t played the last card in the cost-cutting deck yet.  Which would suggest more mass firings on the horizon. (And which would not be good for the “rebuild trust in management” initiative).

*UPDATE: We’ve sniffed around, and it sounds as though more firings are coming, but that they will be small, tactical cuts rather than the wholesale amputations of last month and recent years.  We are still surprised that AOL would consider any cuts on the heels of last month’s carnage, but that’s what we’re hearing.  A reader suggests that the display-ad salesforce will get it this time.

See Also:
Time Warner Q3 Solid; Bewkes “Looking at Everything”
How To Fix AOL 1: Rebuild Morale and Trust
How To Fix AOL, 2: Pick One Head of Content Instead of Three 

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