ViacomCBS said its second quarter net income tumbled amid declines in advertising revenue at its cable and broadcast outlets, the latest sign of the toll the coronavirus pandemic has taken on the operations of U.S. media companies.
The New York owner of the CBS broadcast network, the Showtime pay-cable operation and the Nickeodeon kids-media empire said second quarter profit came to $481 million, or 78 cents per share, in the second quarter, compared with $977 million, or $1.58 per share, in the year-earlier period.
Revenue fell 12% to $6.28 billion, compared with $7.14 billion in the year-earlier period. Advertising revenue fell 27%, the company said, to $1.93 billion, compared with nearly $2.65 billion in the year-earlier period.
Just as rivals like Walt Disney and Discovery have done in recent days, ViacomCBS emphasized the performance of its streaming-video operations, to which consumer interest is migrating. ViacomCBS said revenue from streaming and digital video rose 25% to $489 million, largely driven by increased subscriptions. Domestic paying subscribers to its streaming services reached 16.2 million, compared with 13.5 million in the first quarter. Still, the present figure represents a small portion of the company’s overall revenue stream. The company’s second-quarter performance exceeded Wall Street estimates.
“Despite the impact of COVID-19 on revenue in the quarter, we’re successfully managing through the effects of the pandemic, reaffirming the strength of our combined operations,” said Bob Bakish, ViacomCBS’ CEO, in a statement. ViacomCBS remains “on track,” it said, to relaunch its streaming-video assets as a new collective “super service” in 2021.
In the meantime, the effects of the pandemic crimped its current operations. Revenue was off 22% at its TV operations, owing to advertising declines and lower revenue from content licensing. Revenue fell 26% at the company’s film businesses, largely due to the closure of theaters that might typically show the company’s new movie releases. And revenue was off 8% at the company’s publishing operations, where the pandemic spurred a slump in the sale of print books.
A bright spot was to be found at the company’s cable operations, where revenue increased 2%, thanks to the licensing of the popular series “South Park” for streaming on WarnerMedia’s HBO Max subscription-video hub.