Verizon is exploring a potential sale of its media assets, including Yahoo and AOL, the Wall Street Journal reported on Wednesday.
The sale, should it go through, could be worth $4 billion to $5 billion and would include the private equity firm Apollo Global Management, according to the Journal.
A spokesperson for Verizon declined to comment.
Verizon acquired AOL in 2015 for $4.4 billion and added Yahoo’s core assets to its portfolio in 2016 for $4.8 billion. In 2017, after officially closing its deal to acquire Yahoo, Verizon sought to merge the two brands under the Oath umbrella, which was later rebranded to Verizon Media Group alongside other Verizon-owned media outlets like TechCrunch and HuffPost.
But the telecom giant has struggled to turn a profit on its media assets and, in 2019, Verizon Media Group cut 800 jobs, or about 7% of its staffers, as it turned its focus toward video and mobile. That same year, Verizon Media Group cut another 150 jobs across AOL, Yahoo, TechCrunch and HuffPost.
But the telecom giant appeared to have more success toward the end of last year. For the first time since its 2017 acquisition of Yahoo, Verizon Media reported its first quarter with year-over-year growth in Q4 last year, with $2.3 billion in revenue, representing an 11.4% increase year-over-year.
Verizon most recently sold HuffPost, which it acquired through the AOL acquisition, to BuzzFeed last November in a stock deal. As part of the deal, which formally went through this past February, Verizon took a minority stake in BuzzFeed — a move that, according to Recode’s Peter Kafka, made it seem like Verizon was “literally paying BuzzFeed to take over HuffPost.” The acquisition also led to a loss of at least 47 positions at HuffPost.
While it’s not immediately clear whether a sale of Yahoo and AOL will go through, once-flourishing digital media companies have had difficulty finding financial success in recent years as they’ve struggled to take on digital advertising tech giants like Facebook and Google. In the past few years, there have been high-profile media mergers, including Vox Media’s acquisition of New York Media, Vice Media’s $400 million acquisition of Refinery29, Group Nine Media’s $300 million acquisition of PopSugar and BuzzFeed’s acquisition of HuffPost.
“As social media companies continue to dominate the content space and control the market for ad dollars, new media companies that were flourishing five or 10 years ago are now faced with a tough choice: band together or bust,” Peter Bittner, a journalism professor at UC Berkeley, told TheWrap last November.