AOL just revealed that it achieved 7% growth in revenues year on year for the last quarter, and that it spent $405 million to purchase video ad outfit Adap.tv. The company reported similar sales successes in the previous quarter.
Since the purchase of Adap.tv was for $322 million in cash, a lion's share of AOL's $470 million cash reserves, the purchase represents an incredibly bold step for AOL. But since the company already has a successful targeted banner ad division, and Adap.tv sells similar services but for targeted video ads, there is likely to be a significant synergy between the new purchase and AOL's existing assets.
Specifically, AOL notes that the acquisition is the "only complete global programmatic video technology stack for publishers and advertisers across all screens." The hope is likely that AOL can soon compete with ad technology from the likes of Google and other Internet giants.
AOL has been on an acquisition spree in recent years. In 2011 it bought the Huffington Post for $315 million, and more recently it bought gadget review site GDGT.com to bolster its existing stable of tech publications, which includes Engadget.com as part of its purchase of Weblogs Inc.
[Image via Flickr user: Global X]