Total advertising sales in the first quarter of 2014 were down 12% to $2.16 billion from $2.46 billion. Last year’s results included more than $280 million in advertising sales from the CBS Television Network broadcast of Super Bowl XLVII.
Overall, CBS' revenues were down 4% to $3.86 billion, with net income up 6% to $468 million. Analysts were expecting $3.91 million in revenue.
Speaking on Thursday about the upcoming advertising selling season to financial analysts, Les Moonves, president/chief executive officer of CBS Corp., said he was looking forward to the upfront market -- in part because of its expected high-rated “Thursday Night Football” package in the fall, which is expected to pull in big advertising revenues.
Moonves said that CBS intends to capture more viewing through seven days of time-shifted programming and sell it to TV advertisers. “You're going to see more and more C7 deals... There are a lot more advertisers that are looking at C7.” C3 is the currency among TV advertisers with national TV networks -- the average commercial ratings plus three days of time-shifted viewing.
He explained: “Advertisers want the large audiences. They want every viewer counted because it means their advertising is being watched by more people... They're going to want those extra four days. And when that doesn't occur, once again, we can sell it in different ways.”
This will come with dynamic ad insertion into CBS programming aired on video-on-demand services -- where new TV commercials can be swapped out after three days of viewing. CBS previously announced a VOD initiative of this type.
Looking at the rest of CBS' financial first-quarter results, its entertainment division -- which includes CBS Television Network as well as CBS Television Studios, CBS Global Distribution Group, CBS Films, and CBS Interactive -- lost ground, down 9% to $2.3 billion. This was the result of tough comparisons to first-quarter 2013, when CBS had the Super Bowl, as well as two fewer NCAA Men's Basketball Tournament games on CBS.
Local broadcasting through CBS Television Stations and CBS Radio was down 2% to $626 million, also impacted by unfavorable comparisons to a year ago. Affiliate and subscription fee revenues rose 9%, led by higher cable affiliate fees.
Content licensing and distribution revenues grew 6% to $1.07 billion, driven by higher international licensing of television programming and fees from CBS Television Network-affiliated television stations.
Cable networks -- Showtime Networks, CBS Sports Network, and Smithsonian Networks -- were up 12% to $537 million in revenue.
Publishing revenues sank 11% to $153 million, with 29% of publishing's total revenues now coming from digital sales. Best-selling titles include "Rush Revere and the First Patriots” and “The Women of Duck Commander.”
Outdoor Americas revenues for the first quarter of 2014 grew 2% to $288 million. Last month, CBS completed the initial public offering of its outdoor-advertising business.
In after-market trading on Thursday, CBS stock was down 2.6% to $56.50.