Paramount Global’s earnings in the fourth quarter edged Wall Street forecasts, but a double-digit slide in advertising dragged down total revenue by 6%.Revenue came in at $7.6 billion, while earnings totaled 4 cents a share. Analysts had expected a loss of 1 cent per share, but revenue of $7.84 billion.Linear TV advertising, which faced tough comparisons with the midterm-election-boosted 2022 frame, declined 15% to $2.28 billion. The dual strikes of 2023 also affected the pipeline at CBS and other networks, further squeezing ad sales.The company said it is forecasting that its domestic streaming business will turn profitable by 2025. It also said 2022 was the peak of streaming losses, confirming management commentary in recent months. Revenue at Paramount+ shot up 69%, while subscriber levels climbed to 67.5 million, up 4.1 million from the previous quarter.Paramount Pictures, which has found success this month with Bob Marley: One Love, struggled in the fourth quarter. The Filmed Entertainment division of Paramount posted a 31% drop in revenue to $647 million, a decline the company blamed primarily on lower revenue from licensing. Licensing revenue fell 32% from the year-ago quarter, when Top Gun: Maverick made a splash in the home entertainment marketplace. The company also brought in less revenue from studio rentals and production services as a result of the strikes.The quarterly financials are landing during a time of great uncertainty at Paramount. Formed from the 2019 merger of CBS and Viacom, the company has held talks recently with a number of entities interested in acquiring some or all of its assets. None of the discussions have progressed to an advanced stage, but investors have raised questions about the company’s vulnerability to declines in linear TV viewing and advertising, as well as its ability to compete in the cash-intensive streaming derby. Shares in Paramount fell almost 2% Wednesday to close at $11.06. They are down more than 20% in 2024 to date and are worth a fraction of what they were when the merger closed.“Our disciplined execution and strong content offering drove our results in 2023, as we continue to evolve our business for profitable growth in 2024 and beyond,” CEO Bob Bakish said in the company’s earnings release. “Looking ahead, we continue to be focused on maximizing the return on our content investments and scaling streaming, while transforming the cost base of our business. And I couldn’t be more thrilled with the early momentum we’ve had across every platform in 2024, demonstrating the power of our strategy and assets.”
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