Paramount Global reported its third-quarter financial results, including a swing to a streaming profit from its loss a year ago, on Friday in the Hollywood conglomerate’s second earnings report since its sale to Skydance Media was revealed.
That marked the second quarter of streaming unit profitably in a row, though CFO Naveen Chopra during a morning analyst conference call forecast the timing of content and marketing expenditures would produce a loss for the streaming business during the current fourth quarter, even as domestic profibility for its Paramount+ streaming platform in 2025 was expected.
Currently controlled by National Amusements, led by Shari Redstone, Paramount said Paramount+ added 3.5 million subscribers compared with the second quarter in June to end September with around 72 million subscribers.
The subscriber growth at Paramount+ during the latest quarter derived both internationally from a new hard bundle agreement, or a hybrid carriage deal typical of foreign markets where the cost of entry is lowered, and domestically from the new multi-year distribution agreement with Charter Communications that makes the ad-supported tier available.
Adjusted operating income before depreciation and amortization (OIBDA) in Paramount’s streaming unit, known as its direct-to-consumer segment, amounted to $49 million in the third quarter, compared with a year-ago loss of $238 million. DTC segment revenue rose 10 percent to $1.86 billion, driven by an 18 percent advertising gain and a 7 percent subscriber revenue increase. Paramount+ revenue even jumped 25 percent, “driven by year-over-year subscriber growth and average revenue per user expansion” of 11 percent.
Paramount’s latest results included a $104 million charge related to the value of FCC licenses and a $321 million severance charge connected to layoffs and the departure of former CEO Bob Bakish.
The company said “Sports, including the return of the NFL and UEFA, originals like Tulsa King, which saw the biggest global debut in platform history for season 2, and Mayor of Kingstown, as well as post-theatrical releases, such as A Quiet Place: Day One and IF, all drove acquisition in the quarter.”
The transactions with Skydance are expected close in the first half of 2025, co-CEO Chris McCarthy reiterated during a morning analysts call following the earnings update. Fellow co-CEO Brian Robbins added Paramount continued to work to transform its streaming businesses and streamline the studio to reduce costs.
Paramount also posted the latest quarterly results for its Filmed Entertainment unit, whose biggest new release in the period was Transformers One, while its biggest third-quarter box office performer was A Quiet Place: Day One, released at the end of the second quarter on June 28. Filmed Entertainment unit adjusted OIBDA came in at $3 million, a $52 million turnaround from the loss of $49 million in the year-ago period hit by the dual Hollywood strikes. The key driver was the fact that expenses declined from $940 million to $587 million.
Paramount’s total third-quarter revenue declined by 6 percent to $6.73 billion, operating income fell by 46 percent to $337 million, while adjusted OIBDA rose 20 percent to $858 million.
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