Verizon takes billions in charges for Oath, buyouts

Verizon Communications is taking a $4.6 billion goodwill impairment charge related to its failed media division Oath.

Oath, which is the result of a merger between Yahoo and AOL under the Verizon brand, has been a black eye for the telecommunications firm, which spent some $9 billion to create Oath by acquiring internet giants AOL in 2015 for $4.4 billion and Yahoo for $4.5 billion in 2017.

Tim Armstrong, the former AOL boss, took the helm of Oath in 2017 with the goal of challenging the powerful duopoly of Google and Facebook for advertising revenue. He aimed to amp up page views across Oath’s sites to 2 billion by 2020 from 1 billion last year.

Armstrong also claimed that the division would generate $10 billion in annual revenue by 2020.

But Oath wasn’t able to make meaningful gains on Google and Facebook, which together will capture 57 percent of the US digital ad market in 2018, according to eMarketer.

This fall, Armstrong exited as the unit posted third-quarter revenue that fell 7 percent, to $1.8 billion, far from its goal of $10 billion.

Shares of Verizon rose 1 percent on Tuesday, to $58.85.