Viacom 3Q Profit Down 7 Pct on TV Ad Decline
NEW YORK (AP) — Viacom says its net income fell 7 percent in the latest quarter as advertising revenue decline more than expected, and its movie releases failed to measure up to last
NEW YORK (AP) — Viacom Inc., the owner of Paramount Pictures, MTV and Nickelodeon, on Friday said that its net income fell 7 percent in the latest quarter as advertising revenue declined more than expected and its movie releases failed to measure up to last year's.
Viacom earned $534 million, or $1.01 per share, in the April to June quarter. That compares with $574 million, or 97 cents per share, in the same period last year.
Excluding some one-time tax benefits, earnings were 97 cents per share in the fiscal third quarter. That was 3 cents below the average analyst estimate as polled by FactSet.
The New York-based company's revenue fell 14 percent to $3.24 billion, 7 percent below analysts' estimate of $3.49 billion.
Revenue fell 5 percent at Viacom's TV networks as U.S. advertising fell 7 percent. Viacom has been struggling with a ratings decline for key channels, particularly Nickelodeon. It says it's investing aggressively to create new hits. TV accounts for two-thirds of Viacom's overall revenue and nearly all of the profits.
On a conference call with analysts, CEO Philippe Dauman said the timing of Nickelodeon's Kids' Choice Awards and the BET Awards also cut into advertising revenue. Last year, both shows were in the third quarter; this year, neither was.
Dauman said the company is moving aggressively to shake up its production to get its viewers back.
At Nickelodeon, "we're really now starting beginning to see the fruits of what we're doing and we have a very strong lineup coming forward," Dauman said.
Revenue dropped 29 percent at Paramount, which released three films in the quarter: "Madagascar 3: Europe's Most Wanted," ''The Dictator" and "Titanic 3D." In the same quarter last year, it had four blockbusters: "Kung Fu Panda 2," ''Thor," ''Super 8" and "Transformers: Dark of the Moon."
Despite missing Wall Street estimates, Viacom's Class B shares rose $1.37 to close at $47.20 Friday. They are near the high end of their 52-week range of $35.13 to $49.85.