CBS Corp. said its second-quarter earnings fell 7% as the
television broadcaster was hurt by weaker advertising revenue and
lower television licensing revenue.
CBS doubled its stock buyback authorization to $6 billion and
raised its quarterly dividend by 25% to 15 cents a share, up by
three cents a share.
CBS has benefited from strong ratings relative to peers and the
advent of retransmission fees charged to pay-TV companies. CBS also
has been able to draw top dollar for syndication of popular shows
such as the hit comedy "The Big Bang Theory" domestically. The
broadcast company is aiming aimed to ramp up international sales of
syndicated content,
However, advertising sales in the industry's advance selling
season known as the "upfront" season were disappointing for the
coming fall television, as two of the biggest marketers in the
U.S., Procter & Gamble Co. and General Motors Co. pulled back
on commitments.
CBS Chief Executive Leslie Moonves said the broadcaster's
per-share earnings continue to be driven by high-margin,
fast-growing revenue streams which stand to become a bigger factor
in CBS's growth. Mr. Moonves cited the company's recently completed
separation from CBS Outdoor Americas Inc. and a Supreme Court
decision that sided with TV broadcasters on whether streaming-video
service Aereo Inc. needed permission to air their content.
CBS reported a profit of $439 million, down from $472 million, a
year earlier. On a per-share basis, earnings were flat at 76 cents
amid fewer shares outstanding.
Excluding items, earnings from continuing operations rose to 78
cents from 75 cents. The adjusted figure excludes CBS Outdoors for
both periods and reflects a 45 million reduction in shares
outstanding.
Revenue decreased 14% to $3.19 billion.
Analysts polled by Thomson Reuters expected a per-share profit
of 71 cents and revenue of $3.24 billion.
Entertainment segment revenue declined 8.6% to $1.84 billion, on
lower television licensing revenues reflecting the timing of sales
and as the year earlier period included the semifinals of the NCAA
Tournament.
Advertising revenue fell 7% to $1.64 billion on softness in the
advertising marketplace and the absence of the NCAA semifinals.
Content licensing and distribution revenue dropped 9.4% to $903
million.
Subscription and affiliate fees increased 6.7% to $586 million
amid higher rates at Showtime Networks, CBS Sports Network, and
Smithsonian Networks.
Earlier Thursday, CBS Outdoor said its second-quarter earnings
fell 38% as revenue missed expectations and the company was hit by
higher overhead and interest expenses.
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