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Shares in the media company fell about 8% before the bell. The
stock has gained about 45% since the start of 2023 to
Wednesday's close.
Rising prices, higher borrowing costs, easing consumer demand
across products and services, and geo-political unrest in
certain regions have forced companies to pull back on
advertising spending.
TV advertising revenue fell 7% in the three months to December,
despite a lift from political advertising on the back of U.S.
mid-term elections in November.
Paramount+ added a record 9.9 million subscribers, partly due to
the streaming release of hit film "Top Gun: Maverick", as the
business cushions the company in the face of increased
cord-cutting.
The company last month said it would integrate Showtime, known
for popular shows, including "Billions," "Yellowjackets" and
"Dexter", with Paramount+ across platforms later this year as it
prioritizes streaming services.
Total revenue rose 2% to $8.13 billion in the quarter, but
missed expectations of $8.16 billion, according to Refinitiv
data.
Operating losses in the company's direct-to-consumer unit, which
houses its streaming services like Paramount+ and PlutoTV, rose
to $575 million from $502 million. Investors have focused on the
service as the company has outlined plans to spend aggressively
on content to fend off competition.
"Our content and platform strategy is working and, with even
more exceptional content coming this year, we expect to return
the company to earnings growth in 2024," said Chief Executive
Officer Bob Bakish.
Paramount is again looking to sell Simon and Schuster, months
after a deal to sell the book publisher to Penguin Random House
collapsed, Reuters reported earlier this week.
(Reporting by Eva Mathews in Bengaluru and Helen Coster in New
York; Editing by Sriraj Kalluvila)
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