HOLLYWOOD — A huge writeoff for its struggling TV Guide magazine ballooned Gemstar TV Guide’s net loss in the third quarter.
News Corp.-controlled company took an impairment charge of $131.6 million for its TV Guide assets, turning what would have been a profit into a $98.3 million net loss. Revenue was up 6% to $175.1 million, though, based primarily on gains for its onscreen guides.
TV Guide magazine continued its decline last quarter, as revenue fell 11% from a year ago to $90.6 million. Company said decreased circulation and advertising both played a role. Lower costs helped division cut its overall loss.
Company’s cable and satellite division was the best performer, with revenue up 57% to $61.5 million. Subscriber, licensing and advertising revenue all grew substantially for its TV Guide Interactive product, while company’s TV Guide Channel and TVG horse race betting network posted healthy gains as well.
Legal problems related to the accounting scandal involving its previous management team continued. Gemstar’s legal costs in the third quarter were a substantial $17.7 million.
“While the challenges in our publishing division continue and our legal costs remain significant, we are encouraged by positive momentum in a number of our businesses,” said CEO Jeff Shell.
Gemstar-TV Guide shares closed about even at $5.97 Tuesday before earnings were announced, but were down more than 5% in after-hours trading.