Theatrical success could only partially offset declines in pay TV and advertising for Paramount Global as the media giant released its third quarter financial results this week.
Driven by the performance of Top Gun: Maverick, the company’s filmed entertainment division produced revenue of $783m for the quarter, 48% up on the figure for the third quarter of 2021. Direct-to-consumer revenue was also healthy, increasing 38% to $1.23bn.
Overall revenue, however, was up only 5%, to $6.92bn, and operating income fell 36% to $566m. Adjusted earnings per share were down 49% to 39 cents, causing a drop in the company’s share price in early Wednesday (2) trading on Wall Street.
The company identified Top Gun: Maverick - which has grossed $1.49bn worldwide and now ranks as the fifth biggest domestic release of all time - as the “key contributor” to its filmed entertainment result. But it also noted the performance of recent horror release Smile, which it said was made for $17m and is on track to gross more than $200m globally.
In a call with analysts after the results were announced, Paramount Global president and CEO Bob Bakish said Smile will be “the next example of our 45-day theatrical to streaming fast-follow strategy,” moving onto the company’s Paramount+ streaming service after its theatrical run.
The strategy “gives us a very compelling return on investment,” Bakish said. Both Top Gun: Maverick and Smile, he added, “really benefited significantly from the theatrical window, and that’s both financially and from a marketing franchise-building perspective.”
The Paramount+ plus service, launched in March 2021, added 4.6m new subscribers in the third quarter to reach 46m worldwide, with international markets driving the growth (though it lost 1.9m subscribers when it was replaced in the Nordics by Paramount and Comcast’s new SkyShowtime service).
Addressing the future of Paramount’s premium channel Showtime, Bakish said the network is entering a “particularly compelling” chapter. Showtime, he said, will “benefit from further integration with the rest of the company.” And its programming slate “is going to evolve. There’s been some early conversations around that. Start with the fact that the Showtime brand will stand really more than ever for thought-provoking, distinctive, often edgy content.”
No comments yet