Paramount Global beat Wall Street analysts’ estimates in the third quarter, thanks in large part to streaming flagship Paramount+, which added 2.7 million subscribers to hit 63 million globally.Total revenue came in at $7.13 billion, up 3% from the year-ago period, while adjusted earnings per share grew 21% to 36 cents. Analysts’ consensus called for earnings of 11 cents and revenue of $7.12 billion.Streaming was the standout in the results, with revenue in the division surging 38% compared with the year-earlier period. Subscription revenue shot up 46% to $1.3 billion, driven by subscriber growth and Paramount+ price hikes, plus revenue from pay-per-view events.Paramount said it now forecasts full-year DTC losses in 2023 will be lower than in 2022, with direct-to-consumer losses in the fourth quarter lining up with those in last year’s fourth quarter. Third-quarter operating losses in streaming fell to $238 million from a loss of $343 million.Investors hailed the largely upbeat report, despite the fact that aspects of it reflected a traditional company still working to make the turn toward a profitable digital future. Shares in Paramount, which gained more than 10% in Thursday’s regular session, leaped another 10% in after-hours trading.Advertising revenue in the streaming unit climbed 18%, while viewing hours across Paramount+ and Pluto TV grew 46%.Revenue in the TV Media division, meanwhile, fell 8% due to weakness in advertising, which tumbled 14%.Affiliate and subscription revenue was “substantially flat,” the company said. Lower affiliate revenue was offset by revenue from pay-per-view events. In the earnings release, Paramount said advertising revenue suffered from a lack of political ads (as has been the case with other media companies in this off-year in the cycle) but also from what it more ominously called “continued softness.”Filmed Entertainment posted a 14% gain in revenue to $891 million. The company said licensing and “other” revenue fell 7%, reflecting tough comparisons with Top Gun: Maverick and lower revenue from studio rentals and production services due to the WGA and SAG-AFTRA strikes.The labor unrest also hurt the bottom line, as Paramount reported an operating loss before depreciation and amortization of $49 million, compared with positive OIBDA of $41 million in the 2022 period. The swing to the red was due to “the timing and mix of theatrical releases in each year as well as incremental costs incurred during production shutdowns and lower revenue from studio rentals and production services,” the earnings release said.
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