Paramount falls short of revenue expectations but posts surprise profit, strong streaming results

Paramount Global missed revenue expectations for the fourth quarter Wednesday but posted a surprise quarterly profit and posted strong results from its streaming platform Paramount+.

Here’s how Paramount performed in the fourth quarter compared to Wall Street estimates from LSEG, formerly known as Refinitiv:

• Earnings per share: 4 cents vs. an expected loss of 1 cent
• Revenue: $7.64 billion vs. $7.85 billion expected

For the last three months of 2023, Paramount reported a profit of $514 million, or 77 cents per share, up from $21 million, or 1 cent per share, the year prior. Adjusted for one-time items, earnings per share were 4 cents for the period.

Paramount — home to brands such as CBS, Showtime, BET, Nickelodeon and its namesake movie studio — reported a 6% year-over-year revenue decline but posted notable strides in its streaming segment.

Paramount+, its flagship streaming service, reached 67.5 million subscribers during the period, a net increase of 4.1 million, and recorded 69% revenue growth year over year. The company expects to achieve profitability for Paramount+ by 2025, it said Wednesday.

Subscription revenue in the fourth quarter grew by 43%, partially driven by price increases, and revenue across its entire direct-to-consumer segment grew 34%.

Paramount saw a 27% jump in global viewing hours across Paramount+ and Pluto TV during the fourth quarter.

“Looking ahead, we continue to be focused on maximizing the return on our content investments and scaling streaming, while transforming the cost base of our business,” CEO Bob Bakish said in a press release. “And I couldn’t be more thrilled with the early momentum we’ve had across every platform in 2024, demonstrating the power of our strategy and assets.”

Paramount has been exploring sale options for all or parts of its business in recent months as the media landscape rapidly changes. Paramount has struggled without a solid growth narrative, with shares down more than 50% over the past two years.

Warner Bros. Discovery had been in preliminary talks to acquire Paramount, but those talks have since halted, CNBC’s Alex Sherman reported Tuesday.

Paramount announced about 800 layoffs earlier this month, just a day after the company revealed it had reached record viewership numbers for this year’s Super Bowl.

The company on Wednesday reported its TV media revenue declined 12% year over year. Advertising revenue declined 15% due to overall “softness in the global advertising market and 5-percentage point impact from lower political advertising,” according to the earnings release.

Revenue in Paramount’s filmed entertainment sector sank 31% year over year driven by lower licensing revenue.

This story is developing. Please check back for updates.