Paramount Global revenue in the first quarter climbed 6% year-on-year as Paramount+ added 3.7m subscriptions to reach 71m-plus and the streaming business cut losses by more than 40%.
Less than 30 minutes after the company announced the departure of CEO Bob Bakish and the establishment of a new leadership triumvirate comprising divisional heads George Cheeks, Chris McCarthy, and Brian Robbins, the trio led a whistlestop earnings call before signing off to the strains of Mission: Impossible without taking analysts’ questions.
Overall revenue for the period ending March 31 climbed 6% year-on-year from $7.4bn to $7.7bn, while operating loss improved 66% from $1.2bn to $417m.
Streaming losses improved by 44% from $511m to $286m. Revenue at the direct-to-consumer division gained 24% year-on-year and climbed from $1.5bn to $1.8bn, while subscription revenue increased 22% from $1.1bn to $1.4bn driven by price hikes and membership growth.
Paramount+ revenue grew 51% on the back of subscriber growth and ARPU (average revenue per user) expansion.
Streaming advertising revenue increased by 31% from $398m to $520m, driven by growth from Pluto TV and Paramount+, with this year’s Super Bowl LVIII stream a key draw.
In the studio division, theatrical revenues increased by 3% year-on-year from $588m to $605m powered by Mean Girls, Bob Marley: One Love, and The Beekeeper.
Revenues at the TV media division grew by 1% from $5.19m to $5.2bn, with a 14% gain in advertising revenue the highlight.
Cheeks, president and CEO of CBS, thanked the departing Bakish, and noted the company’s strategic priorities would be to optimise Paramount Global content, strengthen the balance sheet, and optimise streaming strategy.
It remains to be seen how much say the trio will have in strategic direction as uncertainty swirls over the future ownership of Paramount Global.
Controlling shareholder Shari Redstone continues to engage in exclusive negotiations with David Ellison’s Skydance Media, whose bid is backed by RedBird Capital.
Skydance is understood to have offered a sweetener in the form of a $3bn cash infusion which would give shareholders a larger stake than originally planned after they argued a deal would benefit Redstone but not necessarily other shareholders. The money would be used to pay off debt and buy back stock, according to The New York Times.
Private equity firm Apollo has also made an all-cash $27bn bid with Sony Pictures.
Paramount Global stock fell from $12.50 at market opening to $12.25 at close. It spiked at $12.56 during the call before dropping to $12.30.
Year to date, the stock has fallen by 14%. However it has plunged approximately 70% since August 2019, when the CBS-Viacom merger resulting in Paramount Global was announced and stock traded in the $41 range.
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