AMC Networks ended its first quarter of 2022 with 9.5 million streaming subscribers.
The new figure, revealed along with the rest of the company’s Q1 financial results on Thursday, is in line with the projection CFO Christina Spade gave in February. At that time, Spade said she expected AMC Networks to add 400-500,000 streaming subscribers by the end of March, after reaching more than 9 million subs at the end of 2021. Spade also said AMC Networks was anticipating getting halfway to its larger goal of having 20 million to 25 million streaming subs in 2025 by the end of this year.
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AMC Networks’ lineup of targeted streaming services includes AMC+, Acorn TV, Shudder, Sundance Now, ALLBLK and HIDIVE, newly acquired with the purchase of anime content distributor Sentai. Those digital offerings are in addition to the company’s linear channels AMC, BBC America (a joint venture with BBC Studios), IFC, SundanceTV, WE tv and IFC Films.
Despite the positive subscriber growth news for the quarter that included the debut of the final season of “Killing Eve,” AMC Networks missed on analysts’ estimates for both its revenue and profit. Wall Street had forecast earnings per share (EPS) of $2.63 on $758.05 million in revenue for AMC Networks’ Q1, according to consensus data provided by Refinitiv. On Thursday, AMC Networks reported adjusted diluted EPS of $2.54 on $712 million in revenue. Net revenue was up 3% over last year, while profit was down almost 15%.
AMC Networks’ Q1 domestic operations revenue increased 6% to $605 million. Distribution revenue was up 8%, with subscription revenue growing 8%, and content licensing sales increasing 9%. Ad sales were up 1% to $201 million, which reflected AMC Networks’ higher pricing and ad-supported streaming growth, which was partially offset by declining linear ratings.
For the “International and Other” segment, which includes AMC Networks International, its international programming business, and 25/7 Media, its production services business, revenue fell 9% to $110 million compared to the prior year’s Q1. Distribution revenues decreased 12%, while ad sales were up 4%.
The company saw an overall operating income of $174.7 million for the three months ended March 31, up 2.9% from the same quarter last year. With some adjustments, that income figure rose to $211 million, which is down 11.3% compared to the previous Q1’s comparable favorably-adjusted operating income.
“AMC Networks had solid first quarter performance, highlighted by 3% total company revenue growth and continued growth of our streaming portfolio to end the quarter with 9.5 million total subscribers,” interim CEO Matt Blank said in a prepared statement accompanying the Q1 letter to investors. “We continue to advance our differentiated strategy of offering streaming services that appeal to audiences with distinct affinities and passions, which is leading to strong consumer loyalty and low churn. 2022 is the biggest year of original programming in AMC Networks’ history and our content continues to break through, including the recent final season premiere of ‘Better Call Saul,’ which drove record levels of subscriber acquisition for AMC+. With our content cost advantages, our ability to super serve audiences, and our clear path to profitability by virtue of our unique strategy, we are reaffirming our full year 2022 financial outlook and our target of achieving 20 million to 25 million streaming subscribers in 2025, as we continue to reconstitute our revenue mix and as we remain focused on profitability.”
AMC Networks stock closed Wednesday at $35.07 per share. The regular U.S. stock markets will reopen at 9:30 a.m. ET.
Blank and other AMC Networks executives will host a conference call at 10:30 a.m. ET to discuss the quarter in greater detail.