CBS Reports Lower Net Income in 1Q - Broadcasting & Cable

CBS Reports Lower Net Income in 1Q

Loss of playoff game and slower local advertising cut revenue
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CBS reported lower first quarter profits, pointing to having one fewer NFL playoff game than a year ago.

Net income was $394 million, or 78 cents a share, down from $468 million a year ago.

Revenues were $3.5 billion, down from $3.57 billion a year ago. The company said the shortfall was the result of having an extra NFL playoff game a year ago and lower local ad revenue.

Ad revenues were down to $1.78 billion from $1.87 billion a year ago. Content licensing revenue was down 4% to 1.03 billion from $1.07 billion. Affiliate and subscription fees were up 11% to $628 million from $567 million.

CBS’ entertainment group, including the CBS Television Network, reported operating income of $346 million, down from $420 million because of higher investment in sports and entertainment programming, the company said. Revenue was $2.261 billion, off from $2.303 billion a year ago.

Cable operating income was down 1% to $251 million, reflecting higher operating expenses. Revenue rose slightly to $539 million from $537 million a year ago.

Operating income from local broadcasting was down 10% to $161 million. Revenues were down 5% to $596 million because of slower spending in the entertainment and retail categories.

The company said that net income from continuing operations was 78 cents a share, compared to 77 cents a year ago.

“CBS turned in another quarter of record EPS, and our investment in world-class content will lay the foundation to drive future profits,” said Leslie Moonves, president and CEO, CBS Corporation. “We are set to close the season with four of the top five new scripted series, all of which we have ownership in and can monetize in a growing number of ways.”

“We will also win the season as the most-watched network in America, with a solid performance across all demographics at a time when others are facing ratings erosion,” he added. “Looking ahead, we will continue to build upon our position of great strength with a new primetime lineup that we will announce next week, and we expect to be #1 in the upfront marketplace as well. At the same time, our premium content is also driving growth in our non-advertising revenue sources.”

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