By Jennifer Saba and Lisa Richwine NEW YORK/LOS ANGELES (Reuters) - AOL Inc Chief Executive Tim Armstrong tried to tamp down a backlash after he blamed a pension cut on costs stemming from two employees' "distressed babies," insisting that the Internet provider was focused on families. Armstrong's comments on Thursday during a company town hall meeting about why it was cutting 401(k) contributions caused a fire storm on social media, overshadowing positive quarterly results from AOL. It marked the second recent instance when a gaffe by Armstrong left the CEO with some explaining to do. During the meeting, Armstrong singled out two unidentified employees who had babies with health issues in 2012 and their impact on AOL health costs, which he said had also increased because of "Obamacare" health reforms.