According to Google’s 10-Q filing, Google is regretting their $1 billion investment in AOL for 5% of the company. They have determined that AOL looks like a lemon, and they will never see any return on their investment.
Based on our review, we believe our investment in AOL may be impaired. After consideration of the duration of the impairment, as well as the reasons for any decline in value and the potential recovery period, we do not believe that such impairment is “other-than-temporary” at June 30, 2008 as defined under FSP 115-1
This is a pretty heavy statement — future profits that they would have hoped to generate from this major investment aren’t looking like they will ever exist, but it doesn’t appear that investors in Google are cashing out because of this filing either — at least as of right now.
In AOL’s second quarter, they saw profits drop to $1.1 billion — that’s a 29% decrease in subscription revenues. It’s definitely not looking up at AOL.
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