Viacom delivered a mixed second-quarter financial report Friday, with earnings of 93 cents a share handily beating Wall Street forecasts, but revenue missing targets due to a downturn in domestic advertising.
Total revenue of $2.96 billion declined from $3.15 billion in the year-ago quarter, falling short of the estimate for $3.06 billion.
Domestic advertising declines have been easing in recent quarters, the company said, and this year’s late arrival of Easter — in mid-April, outside of the second quarter — had a 1% negative impact. Viacom said its Advanced Marketing Solutions initiative saw a 76% increase in revenue in the quarter. Advanced advertising — a system that goes beyond traditional Nielsen demographics to target viewers more precisely and through more behavioral indicators — is seen as a potential boon to the company. It factored heavily into the $340 million acquisition of ad-supported streaming platform Pluto TV.
A decline in domestic affiliate revenue at the networks unit was due to SVOD library licensing, the company said, noting that licensing activity was halted as the company finalized its content strategy for Pluto TV. While significant distribution deals were forged with AT&T, Charter and Fubo, the company said contractual rate increases were largely offset by subscriber declines.
Paramount Pictures posted its ninth straight quarter of adjusted operating income improvement. Revenue slid 1% to $730 million, with the studio’s top new release of 2019, What Men Want, coming in the quarter and healthy carryover from Bumblebee.
“As the media landscape continues to segment across price points, we’re confident in our strategy, strong results and the opportunities ahead as we continue to position Viacom for the future,” CEO Bob Bakish said in the earnings release.
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