In the midst of its high-profile battle to win a deal to acquire
Warner Bros. Discovery, Paramount Skydance continues to suffer when it comes to core advertising revenues at its key platforms.
Total core advertising revenues were 4% lower to $3.8 billion,
according to Madison and Wall’s Brian Wieser -- but declined 9% overall (including political advertising) on a pro-forma basis.
Its linear TV networks and stations dropped 10% in
advertising revenue year-over-year to $2.95 billion -- down 3% in core advertising (ex-political).
Direct-to-consumer (D2C) streaming
advertising results -- Paramount+, Pluto TV and BET+ -- slipped 4% to $853 million.
Wieser says Pluto TV sank 16% on its own, largely due to
“under-investment in content and monetization,” resulting from the maturing streaming business.
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Paramount’s other major revenue stream -- affiliate fees and subscription fees
-- was down 2.9% to $5.4 billion.
Looking only at TV media’s affiliate revenue, those distribution fees were down 7% to $2.8 billion.
In a more positive trend, direct-to-consumer
(D2C) streaming fees (including Paramount+) were up 16%. Subscribers climbed 4% to 78.9 million.
One key declining financial measure showed that fourth-quarter content costs for TV Media and
its streaming business were down 8.5%. TV Media content costs were $3.5 billion; streaming, $1.8 billion. That is a concern, says Wieser.
“To the extent that industry spending on content
is generally up year-over-year and there is a direct relationship between share of spend on content and share of ad revenue, under-performance on ad sales should be unsurprising.”
Paramount expects growth in D2C advertising during the rest of the year, with moderate TV media advertising declines.