Tim Armstrong, the chief executive of AOL, did an about-face on Saturday, reversing an unpopular change in the media company’s employee benefits program and apologizing for publicly singling out two families’ health care issues as a cause of those changes.

AOL had recently altered its 401(k) program, switching its matching payments to one lump sum at year-end instead of throughout the year. The change would have disadvantaged AOL employees, especially those who left the company before Dec. 31. On an internal call last Thursday discussing the new policy, he had attributed the change partly to soaring medical costs associated with two families’ “distressed babies.”

In an email to employees late on Saturday, Mr. Armstrong announced the company’s reversal.

“The leadership team and I listened to your feedback over the last week,” Mr. Armstrong wrote. “We heard you on this topic. And as we discussed the matter over several days, with management and employees, we have decided to change the policy back to a per-pay-period matching contribution.”

Under Mr. Armstrong’s leadership, AOL has transformed itself from an Internet portal to a diversified media company. His strong bets on video advertising, in particular, have improved the company’s financial performance.