Paramount’s “Sonic” quarter almost keeps pace with last year’s “Bumblebee” quarter
ViacomCBS beat analysts’ expectations Thursday when it reported its first-quarter 2020 earnings, marking its first full quarter as a recombined company.
Wall Street forecast earnings per share (EPS) of 94 cents on $6.58 billion in revenue, according to a consensus estimate compiled by Yahoo Finance. ViacomCBS actually reported EPS of $1.13 on $6.67 billion in revenue.
Domestic ad sales declined 19% versus the comparable year-ago quarter, which included CBS’ broadcasts of Super Bowl LIII and the NCAA Tournament (canceled this year due to the coronavirus). Domestic streaming and digital video revenue – which includes streaming subscription and digital video advertising revenue – grew to $471 million, +51% from Q1 2019.
Theatrical revenue dipped 3%, as this quarter’s strong box office performance from February release “Sonic the Hedgehog” was offset by year-ago results, which included carryover ticket sales from Christmas release “Bumblebee.”
Content licensing sales were up 9%. Publishing revenue was +4%, driven by higher sales of electronic and digital audio books.
“ViacomCBS delivered solid results in our first full quarter, including sequential improvement on key financial metrics, as well as clear operating momentum,” ViacomCBS president and CEO Bob Bakish said in a prepared statement accompanying the financials. “In the wake of the COVID-19 pandemic, we also took decisive action to fortify our balance sheet, protect our employees and help communities in need. And through new creative strategies and production models, we continue to deliver must-watch content that big audiences love. Importantly, we are just beginning to tap into the potential of our combined assets, and our growing scale, audience reach and earnings power will become even more apparent as the market rebounds and we put the power of our portfolio behind our streaming strategy. I thank ViacomCBS employees around the world for their adaptive creativity and continued focus on serving our audiences, commercial partners and shareholders amid these unprecedented circumstances.”
ViacomCBS stock closed Wednesday afternoon at $14.88 per share, down 3.6% from where it opened that morning at $15.41. The regular trading day for the U.S. stock markets open at 9:30 a.m. ET.
The newly recombined company is still in the midst of cutting costs and streamlining its business after finalizing its re-merging in December. In late February, ViacomCBS announced plans with New York state to lay off 117 East Coast staffers across 11 divisions, with Pop TV being among the first hit by the cuts.
Late last month, ViacomCBS — which was formed by the recombining of Viacom Inc. and CBS Corp. — laid off at least 100 employees, including top execs such as Smithsonian Network president Tom Hayden and Comedy Central head of content and creative enterprises Sarah Babineau.
Viacom and CBS announced their long-awaited merger, valuing the combined company at roughly $12 billion, last summer. When ViacomCBS reported its first earnings as a recombined company back in February, it revealed it now expects to have $750 million in synergy savings by getting rid of overlapping corporate operations and other savings.
Bakish also recently said ViacomCBS is looking to unload its publishing arm Simon & Schuster.
ViacomCBS, like many companies, is also weathering the impact of the ongoing coronavirus pandemic. In March, in attempts to cushion the financial blow brought by the pandemic, ViacomCBS raised $2.5 billion after agreeing to sell two separate debt notes, both with a total value of $1.25 billion each.
Bakish and other ViacomCBS executives will host a conference call at 8:30 a.m. ET to discuss the first-quarter earnings in greater detail.
More to come…
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