Viacom revenue misses estimates on fewer movie releases
By Jennifer Saba and Soham Chatterjee
(Reuters) - Viacom Inc, the owner of cable networks MTV and Comedy Central and movie studio Paramount Pictures, on Wednesday posted lower-than-expected second-quarter revenue as it released fewer movies.
The release in late June of the latest "Transformers" movie, which has since reached blockbuster status, came too late in the quarter to save Viacom's filmed entertainment unit from a decline in revenue; the unit's revenue fell 26 percent.
The 7 percent fall in quarterly total revenue, to $3.4 billion (£2.02 billion), also reflected continuing weakness in domestic advertising revenue at Viacom's cable networks.
Philippe Dauman, chief executive of Viacom, said on a call with analysts that certain automotive and consumer good makers pulled back on their ad spend during the upfronts - the annual spring event hosted by media companies to court Madison Avenue to make advance commitments for most of their television ad budgets.
Domestic advertising revenue at Viacom's cable networks rose 1 percent, below many analysts' forecasts.
"We do believe that some of the dollars that were withheld in the general upfront market will be coming back," Dauman said.
On Wednesday, Time Warner said that advertising revenue at Turner, its cable network division, was up 1 percent.
The lacklustre ad results at both media conglomerates could point to a broader downward trend as consumers shift the way they watch TV and advertisers put more dollars towards digital buys.
Shares of Viacom were down 1 percent at $80.90 in afternoon trade on Wednesday.
Filmed entertainment revenue was hurt by a 43 percent fall in theatrical revenue due to the number and timing of movie releases, Viacom said.
This week, "Transformers: Age of Extinction" became the first movie released this year to earn more than $1 billion in global box office returns, according to Paramount Pictures.
Viacom said operating profit at its cable networks business fell 3 percent as it earned less from certain distribution deals and spent more on programming.
Net income from continuing operations attributable to Viacom fell to $611 million, or $1.40 per share, from $647 million, or $1.32 per share, a year earlier.
Excluding items, the company earned $1.42 per share.
Analysts on average expected an adjusted profit of $1.43 per share on revenue of $3.66 billion, according to Thomson Reuters I/B/E/S.
(Reporting by Soham Chatterjee in Bangalore; Editing by Simon Jennings and Leslie Adler)
