The company, which is headed by acting CEO Joe Ianniello, is expected to complete its recombination with Viacom in early December.
CBS Corp, which is expected to complete its recombination with Viacom in early December, reported lower third-quarter revenues on Tuesday that exceeded Wall Wall's estimates despite increased content spending and its growing streaming services.
The company, led by acting CEO Joe Ianniello, reported adjusted earnings of 95 cents per share, compared to $ 1
Operating profit for the third quarter of $ 501 million compared to $ 690 million for the same period last year and "included expenses incurred during the third quarter in connection with the ongoing merger with Viacom." Adjusted operating income fell 21 percent to $ 581 million from $ 736 million last year "as a result of increased investment in content, including a higher number of series produced across multiple platforms, as well as the company's direct to consumer streaming services."
Revenue for the third quarter reached $ 3.30 billion, an increase of 1 percent, compared with an analytical estimate of $ 3.37 billion. "Revenues from connected and subscription fees increased by 12 percent, driven by increases in fees from CBS Television Network connected stations and forwarded revenues, as well as growth from the company's direct-to-consumer streaming services," the company said. "Revenue for content licenses and distribution increased by 1 percent, primarily as a result of higher sales of series produced for third parties."
As expected, advertising revenue fell 7 percent from the third quarter of 2018, when the company had "record sales of political advertising driven by the midterm elections in 2018." But Ianniello emphasized "a solid underlying network development of 2 percent during the quarter."
The results also came when ratings for the CBS broadcast network fell during the third quarter. Bernstein analyst Todd Juenger in his earnings preview wrote: "Conventional C3, adult 18-49 first age groups for the major broadcast networks were down 13 percent" from the previous year in the third quarter. "CBS dropped even further (18 percent), where some of the underperformance was driven by blackout with AT&T, which lasted from July 20 to August 9, as did Nexstar's CBS subsidiary, which lasted from the beginning of the quarter to the end of August."  Meanwhile, CBS Corp.'s streaming services, CBS All Access and ShowTime, were expected to deliver results in the recent period thanks to shows like CBS All Access " Why Women Kill Kill . And continued expected profit on the transfer of The consent fee was also expected to increase results, as they did.
"We delivered record revenue from the third quarter as we continue to increase our investments in our premium content and direct-to-consumer streaming services, which is the cornerstone of our growth strategy," said Ianniello. in the quarter, our direct to consumer revenue from CBS All Access and Showtime OTT grew by 39 percent from last year, driven by a strong slate Meanwhile, revenues from retrans, reverse comp and virtual [distributor] increased 18 percent, and our total membership and subscription fees increased by 12 percent, representing more than a third of our total revenues during the third quarter. "
He added:" Our Content Licensing Revenue also grows as we increase the production of programming for all of our platforms, including five new hit shows we just launched on the largest media platform, CBS Television Network, which is about to end the season as the most watched network for the 12th consecutive year. "
Looking at the end of the period, Ianniello said:" During the fourth quarter we have a fantastic programming schedule at Showtime, including returning favorites Shameless and Ray Donovan along with a number of exciting new series, such as The L Word: Generation Q . So we build a lot of momentum as we approach our merger with Viacom and enter 2020. ”
Much of Tuesday's revenue from conference revenue is expected to focus on the future prospects of the CBS assets under the recombined ViacomCBS, which is expected is formed when the mega traffic with Viacom is closed in early December.