Analyst: Big Media Companies Only Did So-So in Q4, Despite Their Surprising Profits

By the end of this week we’ll know how nearly all of the Big Media companies performed in Q4. But Nomura Securities’ Michael Nathanson already has some qualms about the industry based on the ones that have reported so far –Disney, News Corp., Scripps Networks, Time Warner, and Viacom — even though most exceeded the Street’s profit expectations. Some of the good news came from filmed entertainment profits. Nathanson doesn’t like to base his forecasts on movie and TV shows, though, because there are too many quirks in Hollywood accounting. “After backing out the ever-volatile film business,” he says, “results were less inspiring.” The companies beat forecasts because they “did a remarkable (and unsustainable) job in reining in operating expenses” especially at their biggest profit drivers: pay TV networks. The problem is that some costs were held down by developments largely outside of the companies’ control. For example, the NBA work stoppage (more…)

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