AOL (AOL) revealed on Friday an in-line 57% leap in fourth-quarter profits as the Internet company generated its first annual revenue growth in eight years amid rising search revenue.
Encouraged by the results and new plans to buy back $100 million of common stock, shares of AOL soared almost 7% in premarket trading, tacking onto their 52-week surge of more than 70%.
The company said it earned $35.7 million, or 41 cents a share, last quarter, compared with a profit of $22.8 million, or 23 cents a share, a year earlier. Analysts had called for EPS of 41 cents.
Revenue gained 3.9% to $599.5 million, topping the Street’s view of $574 million.
AOL said ad sales increased 13% year-over-year to $410.6 million as search revenue jumped 17% to $103.6 million.
AOL’s global display sales were flat year-over-year at $169.8 million, while its AOL properties division logged a 6% rise to $273.4 million. Subscription revenue slumped 10% last quarter, compared with an 18% tumble a year ago.
“AOL returned to growth and generated significant value for shareholders in 2012,” CEO Tim Armstrong said in a statement. “AOL has strong momentum entering 2013 and is positioned to continue on our growth path by executing our strategy to build the next generation media and technology company.”
Meanwhile, AOL’s board of directors signed off on a plan to buy back $100 million of its common stock over the next 12 months.
Shares of the New York-based company rallied 6.65% to $33.50 in premarket trading on Friday morning.