Paramount Skydance announced its second-quarter financial results, showing mixed performance as the company prepares for a significant $110 billion acquisition of Warner Bros. Discovery. The quarter saw a 1% increase in revenue to $6.91 billion, surpassing analyst expectations of $6.88 billion. However, profits fell to $41 million, or 4 cents per share, significantly lower than the anticipated $109 million, or 9 cents per share.
CEO David Ellison expressed optimism about finalizing the merger despite a federal judge scheduling a March trial concerning an antitrust lawsuit raised by a coalition of twelve states. While Ellison noted that the company is open to an out-of-court resolution, he remains confident in their chances of winning in court.
In the streaming segment, revenue climbed nearly 9% to approximately $2.5 billion, aided by new subscriber growth driven by popular series and events. Paramount+ added 2 million new subscribers in the quarter, reaching a total of 81.6 million. Additionally, the studio segment generated $1.3 billion in revenue, bolstered by robust sales to platforms like Netflix and Amazon Prime Video.
However, the television division, encompassing CBS and cable networks, experienced a 9% revenue decline, totaling $3.1 billion. The company forecasts revenues for the current quarter to be between $6.95 billion and $7.15 billion with anticipated profits ranging from $875 million to $975 million.
In response to the ongoing antitrust concerns, Ellison asserted that the lawsuit does not reflect the current competitive landscape of the entertainment industry. He emphasized his commitment to maintaining the independence of CNN within the Warner media portfolio.
The company awaits a ruling on the antitrust case, having agreed to freeze the transaction until at least June 2027, incurring potential costs that could amount to $1.7 billion if delayed.
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