TV Guide Bleeds Money, Sees Hope In Its Network

TV Guide, once the small-screen listings and information monolith with stratospheric circulation, continues to bleed money. Even as ad revenues increased significantly in the recently completed second quarter, its parent company said losses are expected to continue for the next three years.

CFO Bedi Singh said on a conference call, however, that Gemstar-TV Guide (which is for sale) does project the red ink will be increasingly less severe over that period. Losses in fiscal 2007 could be as high as $28 million, but that would be lower than projections as high as $35 million.

The losses come despite a 16% increase in ad revenues and 25% jump in pages sold in the just-completed quarter, versus the same period a year ago.

Separately, on the plus side, the company's re-branded TV Guide Network, which is increasingly focused on original programming, saw revenue nudge up by 3%. The goal, Singh said, is to shift the channel away from its traditional core competency of information about where/when programs are on to "an entertainment destination." Distribution is up 5% from a year ago to 82 million homes.

CEO Rich Battista, who joined Singh on the call to discuss second-quarter results, said sales of packages for the network's coming coverage of the Emmy awards--including its well-known "Red Carpet" presentation--are up 33% versus last year. Prices are also up, he said, and six new advertisers are on board, including Pfizer, Unilever and MasterFoods.

The parent company has been plugging its cross-platform marketing opportunities covering the magazine, network and Web sites to media buyers. It plans to elevate the TV Guide brand to the public via what it labels a "major national consumer marketing campaign" this fall.

Overall for the second quarter, Gemstar-TV Guide reported revenues of $155.6 million--up 17% versus the same period a year ago--with net income up 42%. Much of that growth was fueled by licensing technology for interactive program guides.