CBS Corp. Revenues Up, CBS Radio Revenues Down For Third Quarter

The End Is Nigh

The ENTERCOM merger hasn't closed yet, but as far as reporting financial results, CBS CORPORATION has consigned radio to the "discontinued operations" category.  Reported separately, CBS RADIO showed revenues of $300 million for third quarter, down from $317 million in third quarter 2016, with net earnings of $128 million, up from $48 million in same period the prior year.

As for the rest of the company, revenues were up 3% for third quarter to $3.17 billion, led by a 52% jump in affiliate and subscription fee revenues (largely from SHOWTIME's distribution of the MAYWEATHER-MCGREGOR fight pay-per-view, plus a 27% boost from retransmission fees and growth from the CBS ALL ACCESS subscription service).

Entertainment revenues -- the CBS TV network, studio, syndication, interactive, and CBS FILMS divisions -- fell 7% to $1.82 billion, hurt by a 3% decline in ad revenues due to having one less THURSDAY NIGHT FOOTBALL game on CBS and a 26% slip in content licensing and distribution revenues blamed on the timing of domestic TV licensing sales.  Cable Networks revenue jumped 40% to $840 million, helped by the boxing match as well as increases for the SHOWTIME OTT service. SIMON AND SCHUSTER revenue increased 1% to $228 million, with HILLARY RODHAM CLINTON's "What Happened" and STEPHEN and OWEN KING's "Sleeping Beauties" leading sales.  The Local Media division -- local TV stations and CBS LOCAL DIGITAL MEDIA -- saw revenues down 3% to $397 million, hit by the loss of political sales.

Operating income fell 2% to $707 million, with lower margin revenues for the boxing PPV and the loss of higher margin political advertising cited for the drop.  Net earnings rose from $478 million to $592 million; the latter number included a non-cash gain of $100 million in discontinued operations to increased the carrying value of CBS RADIO to the stock valuation level for ENTERCOM.  Adjusted net earnings decreased 4% to $450 million.  Diluted earnings per share from continuing operations fell 1% to $1.03.

"Our solid third-quarter results demonstrate the way we are shifting our business to capitalize on changing viewing habits," said Chairman/CEO LESLIE MOONVES. "To that point, during the quarter we saw dramatic growth in our affiliate and subscription fees, including revenue from traditional and skinny bundles as well as over-the-top viewing. Today we have more subscribers at CBS and at SHOWTIME than we did a year ago, and best of all, newer digital platforms are resulting in more revenue per subscriber than traditional ones. So not only are we growing our subs, but we are growing our rates as well.

"Our over-the-top services had a particularly strong third quarter, thanks to the exciting launch of STAR TREK: DISCOVERY on CBS ALL ACCESS and the FLOYD MAYWEATHER/CONOR MCGREGOR pay-per-view event on SHOWTIME. Of course, premium content is also driving our success at the CBS TELEVISION NETWORK, where we are once again #1 this season, with two of the top three new shows, including YOUNG SHELDON, which premiered as the #1 show on television overall. In addition, for the first time, the majority of our upfront deals this fall are based on viewing over a seven day-period, which means that we are now beginning to monetize millions of viewers we were not getting credit for a year ago. So from our new OTT services to the monetization of delayed viewing, and from our burgeoning international business to rapid increases in retrans and reverse comp, we are just beginning to capitalize on significant growth areas for the future."

« see more Net News