Weak advertising sales for Viacom's cable networks -- which include MTV and Nickelodeon -- pulled down company-wide business numbers for the second quarter.
Domestic advertising revenue sank 7%, driven by what the company says was "the timing of event-driven programming with the prior year's quarter." The "Nickelodeon Kids’ Choice Awards" aired in its fiscal second quarter, while "BET Awards," aired in its fiscal fourth quarter this year.
Viacom has also been hurt over the last several months by having to owe advertisers more inventory, due to prior audience guarantees -- also known at makegoods.
In particular, Nickelodeon has seen lower ad results due to steep viewership drops -- which company officials said are somewhat unexplained. Some analysts point the finger at Nielsen's measurement service; others say Nickelodeon's kids' programming on subscription video service Netflix is having an effect.
All revenues -- which include affiliate fees -- were 5% lower at its media networks to nearly $2.3 billion. Overall company revenue was down 14% to $3.2 billion, with net income dropping to $523 million from $574 million.
Worldwide advertising revenues declined 9% to almost $1.2 billion. International advertising revenues decreased 18%.
U.S. affiliate revenues sank 1%, which Viacom says is a reflection of the significance of higher digital affiliate revenues in the same quarter last year. Taking this item out versus a year ago, Viacom says domestic affiliate revenue gained versus the same quarter a year ago, in the high single digits. Worldwide affiliate fees increased 1%.
Viacom's filmed entertainment revenues also had a troubling period -- down 29% to $1 billion. Worldwide theatrical revenues decreased 52% in the quarter to $283 million. Viacom released fewer movies in the period versus a year ago, and those pulled in less box-office revenue.
During the quarter, Viacom's Paramount released three films: DreamWorks Animation's "Madagascar 3: Europe's Most Wanted," "The Dictator" and "Titanic 3D." This compares with four movies from the second quarter of 2011: DreamWorks Animation's "Kung Fu Panda 2," Marvel's "Thor," "Super 8" and "Transformers: Dark of the Moon."
Worldwide home entertainment revenues sank 8% in the quarter, and worldwide television license fees decreased 24%.