Paramount Skydance first-quarter profit benefits from cost-cutting

By Dawn Chmielewski and Harshita Mary Varghese

May 4 (Reuters) – Paramount Skydance’s pre-tax earnings rose in the first quarter, the company said on Monday, as streamlined operations and improved results in its streaming and studios businesses helped offset declines in television.

The results are the first since the media giant struck a $110 billion deal to acquire Warner Bros Discovery, aiming to expand its scale in film and television by tapping into Warner’s deep library of movies and series.

“We continue to advance through European and other international regulatory approvals, several of which have already been secured,” Paramount CEO David Ellison said on a post-earnings call.

Shares of the company rose 2.3% in extended trading.

First-quarter adjusted earnings before interest, taxes, depreciation, and amortization were $1.16 billion, up 59% from a year ago, lifted by the Paramount-Skydance merger. Revenue ticked up 2% to $7.35 billion.

Helping boost the profit were the cost savings, following the merger and an 11% increase in streaming revenue.

However, the company forecast second-quarter revenue below Wall Street estimates, citing the lack of tentpole movies like “Mission: Impossible – The Final Reckoning,” and NCAA Final Four college basketball. 

Paramount expects total revenue for the second quarter to be between $6.75 billion and $6.95 billion, below estimates of $7.07 billion, according to data compiled by LSEG. 

To grow its streaming business, Paramount started broadcasting Ultimate Fighting Championship in January, helping lift total subscribers at Paramount+ to 79.6 million in the first quarter.

The platform’s subscriber growth would be flattish sequentially in the second quarter as it exits roughly 2 million international bundled users, the company said.

Paramount plans to consolidate its streaming services Paramount+, Pluto TV and BET+ into one unified platform by the middle of this year.

For the first quarter, the company reported an adjusted profit of 23 cents per share, compared with estimates of 15 cents.

(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Sriraj Kalluvila)