Time Warner, the world's largest media conglomerate, reported sharply higher third-quarter earnings on Wednesday as a result of several asset sales and discontinued operations that were part of the deal to acquire cable systems from Adelphia; its AOL unit reported lower revenues overall but higher profit - as well as a surge in ad revenue.

Time Warner's third-quarter net earnings totaled $2.3 billion, or 57 cents a share, versus $853 million, or 18 cents a share, in the year-earlier quarter, reports the Associated Press. Revenues were up 7 percent, to $10.9 billion, from $10.2 billion. Without 23 cents per share in discontinued operations and 14 cents per share from the sale of assets, earnings came to 19 cents per share, up from 17 cents per share on a comparable basis in the year-ago period. Analysts expected earnings of 20 cents per share.

AOL's operating income before depreciation and amortization increased 21 percent, despite a 3 percent decline in revenues as it adopts an advertising-based model and discards one based on subscriptions. AOL lost 2.5 million dial-up subscribers in the quarter, bringing its total down to 15.2 million.

Wayne Pace, Time Warner's CFO, is quoted by Seeking Alpha as saying AOL's revenue decline was "due mostly to a 13% decline in subscription revenues (to $210 million) which reflected continued subscriber losses. The decrease was offset in part by a 46% increase in advertising revenues (to $151 million), which benefited from solid growth across advertising run on third-party websites generated by Advertising.com, as well as display and paid search advertising."