Viacom, Inc. NASDAQ: VIAB stock is down over 4% in early morning trade on Thursday, as investors digest the company’s Q2 earnings. The company posted earnings per share of $0.79, beating expectations of $0.59 earnings per share.
Viacom, Inc. NASDAQ: VIAB revenue of $3.26 billion also beat expectations of $3.025 billion.
The company’s focus on growing their Paramount business helped boost revenue, with the division experiencing revenue gains across all segments. The firm’s strong performance was overshadowed due to a 43% decrease in operating income. The company’s operating income came in at $332 million.
Viacom’s restructuring expenses were the main driver behind falling operating income.
Viacom, Inc. NASDAQ: VIAB reported that its filmed entertainment revenues increased by 37% to $895 million. International revenue is up 51% to $437 million, with domestic revenue increasing 25% to $458 million on the quarter.
The company’s CEO wants to focus on Viacom’s cable franchise business, which includes Comedy Central, Nickelodeon and MTV. The company’s cable franchise has been under pressure from falling ad revenue and poor ratings.
Advertising revenue is down 1% to $1.11 billion during the latest quarter. Viacom’s domestic sales fell 4% on lower impressions and higher costs. The company’s international advertising revenue rose 11% on the quarter.
Net profit attributable to Viacom fell 60% on the quarter, down to $121 million. The unit took $174 million in restructuring charges.
Viacom, Inc. NASDAQ: VIAB Secures Chinese Financing
Viacom CEO Bob Bakish, hired in December, has implemented measures to help turn the struggling company around. The company announced that they’ve secured a financing agreement for the Paramount operations with two Chinese conglomerates.
The announcement eases investor fears that the three-year deal, worth $1 billion, would fall through after Chinese officials restricted outflow capital. The two partners, Shanghai Film Group and Huahua Media, will make payments this quarter to help finance the studio’s film slate.
Viacom will focus on its six core channels: BET, MTV, Nickelodeon, Nick Jr. and Comedy Central. It also plans to rebrand Spike.
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