The media company, which is controlled by billionaire Sumner Redstone, earned $574 million, or 97 cents per share, in the fiscal third quarter that ended on June 30. That's up 37% from $420 million, or 69 cents per share, a year earlier.
Viacom Fiscal 3Q Earnings Grow 37%
NEW YORK (AP) – Viacom Inc., the owner of MTV, Comedy Central and Paramount Pictures, said Friday that its net income increased 37 percent in the latest quarter thanks to growing advertising sales and higher fees from cable TV, Netflix and other companies that carry its programs.
The media company, which is controlled by billionaire Sumner Redstone, earned $574 million, or 97 cents per share, in the fiscal third quarter that ended on June 30. That’s up 37 percent from $420 million, or 69 cents per share, a year earlier.
Adjusted earnings were 99 cents per share. That’s well above the 86 cents per share that analysts polled by FactSet were expecting. This figure excludes employee-separation charges totaling about $14 million. Judy McGrath stepped down as CEO of MTV Networks during the quarter after 30 years with the network, which she helped shape into a cultural icon.
MTV has been enjoying a resurgence fueled by can’t-look-away unscripted shows such as “Jersey Shore” and “16 and Pregnant.” Viacom said MTV did well even without “Jersey Shore” on the lineup during the quarter. The fourth season of “Jersey Shore” premiered on Thursday.
Viacom’s revenue rose 15 percent to $3.77 billion from $3.28 billion. Analysts were expecting $3.52 billion.
President and CEO Philippe Dauman said the “breadth of hit programming found across Viacom’s media network portfolio” is contributing to strong advertising growth.
Redstone, who serves as Viacom’s chairman, said the company has “found its stride.”
“Our media networks are creating hit after hit, sought after by both audiences and advertisers, and Paramount Pictures is putting together a truly unprecedented year of box office success,” he said in a conference call with analysts.
Worldwide advertising revenue grew 14 percent to $1.28 billion, while U.S. ad sales increased 12 percent during the quarter. The U.S. and worldwide growth rates were slightly higher than what Viacom saw in the previous quarter, a further sign that the advertising market is improving. Dauman said the company expects U.S. ad revenue to grow in the double-digit percentage in the current quarter as well.
Viacom said revenue at its media networks segment, which includes MTV, Nickelodeon and other TV channels, grew 16 percent to $2.39 billion. The company’s filmed entertainment segment, which includes Paramount, saw revenue increase 13 percent to $1.41 billion, thanks to gains in DVD sales and TV license revenue.
Affiliate revenue, the money that cable TV providers and others pay to carry Viacom’s content, grew 19 percent worldwide to $971 million, reflecting higher rates and a growth in digital distribution revenue. The latter refers to money from Netflix and other online video companies that pay Viacom to show its older TV shows. On Netflix, this includes kids’ shows such as “Yo Gabba Gabba” and “SpongeBob SquarePants,” as well as “Jersey Shore” and Comedy Central’s “The Sarah Silverman Show.”
A deal with Netflix also helped boost CBS Corp.’s earnings higher in the most recent quarter, an indication that old-style media heavyweights are benefiting from deals with the newer crop of online video companies.
Theatrical revenues were lower, mainly because of the timing of film releases. The blockbuster “Transformers: Dark of the Moon” was released late in the quarter so most of the money it is making will be counted in the current period. The movie has beat “The Hangover Part II” to become the top-grossing movie in the U.S. so far this year. Worldwide, it has made more than $1 billion in the box office so far.
Viacom’s widely traded Class B shares fell 50 cents, or 1.2 percent, to $43.60 in midday trading Friday after trading briefly as high as $46.23. The stock took a beating on Thursday along with the rest of the stock market amid growing fears of economic weakness and Europe’s debt crisis. The stock has traded in the 52-week range of $30.39 to $52.67.