Paramount Global’s losses narrow as the company emerges from a tumultuous period.
Paramount Global reported optimistic quarterly earnings on Monday, showing the entertainment conglomerate is successfully navigating through a fast-changing market. The earnings call also confirmed the ousting of Bob Bakish, the company’s CEO since 2019.
Bakish clashed heads with Paramount Global’s chairwoman Shari Redstone, whose family has controlled the conglomerate for years.
Redstone is reportedly in talks with Skydance Entertainement’s CEO David Ellison for a merger between the two companies. Bakish was against the deal, likely part of the reasons why he was fired from the top spot.
The deal would make Skydance Entertainment the majority shareholder, placing David Ellison on Paramount’s board. David is the son of tech pioneer and multi-billionaire Larry Ellison, the world’s fourth richest person. Larry Ellison is the co-founder and CEO of Oracle, a tech giant focusing on B2B, AI-based services.
CNBC speculated the Ellisons might want to implement artificial intelligence into Paramount, plunging the legacy media company into the future.
The deal has not been confirmed during the earnings call and is still in the works. Paramount Global also received a joint acquisition offer from Sony and Apollo Entertainment, though Redstone reportedly disliked it.
Bakish was replaced by Paramount’s three most powerful chief executives: Paramount Pictures’ Brian Robbins, CBS’ George Cheeks, and MTV’s Chris McCarthy.
Quarterly revenue jump
Paramount Global will have a better negotiating position after yesterday’s earnings call.
Quarterly revenues were in line with Wall Street estimates of $7.7 billion, up 6% from the same period in 2023.
The company’s TV and movie divisions closed the quarter much better than expected. TV revenues increased 1% to $5.2 billion, mostly thanks to increased ad revenues during the Super Bowl. Movie revenues totaled $603 million after two box office hits: Mean Girls ($104 million worldwide) and Bob Marley: One Love ($177 million worldwide).
Paramount Global ended the quarter with $417 million in operating losses but had to pay $1.12 billion in a one-time charge fee. “We are rationalizing original content on our streaming services, especially internationally,” the company stated, “and improving the efficiency of our linear network programming.”
Indeed, streaming remained a money-losing business despite heavy cost-cutting and a better-than-expected increase in subscribers. Paramount+ reached 71 million global subscribers, remaining the world’s fourth-largest streaming platform after Netflix, Prime Video, and Disney+.
Streaming losses narrowed to $288 million, almost half compared to one year ago. So far, the only major streaming platform turning a profit is Netflix, whose global outreach cannot be matched by rivals. Paramount Global promised to make streaming profitable by 2025.
Paramount’s stock price was up 2.85% for the day after a 14.93% decline year-to-date.
