Revenue misses Wall Street projections, but profits top estimates
Viacom finished up 2012, burning less brightly than it has blazed in the past.
Revenue at the media conglomerate slid 16 percent to $3.31 billion during the quarterly earnings period, as its filmed entertainment division, Paramount Pictures, released fewer movies and failed to field a break-out hit. Yuletide films like "Jack Reacher" and "Rise of the Guardians" could not replicate the box office success of the previous year's "Mission: Impossible – Ghost Protocol," making for a rough year-over-year comparison.
Those revenue figures failed to match Wall Street's expectations. Analysts had projected that Viacom would report revenue of $3.48 billion, according to Reuters.
Net income at the media giant dropped 20 percent to $473 million, or 93 cents per share, from $591 million, or $1.06 per share last year. That just beat projections. Analysts had expected Viacom to post earnings of 91 cents per share.
Revenue in the filmed entertainment division dropped 37 percent to $975 million, which Viacom brass said was do to lower home entertainment sales and the lack of a big franchise movie to appeal to younger audiences. The unit lost $139 million for the quarter.
Unlike in the past, Viacom's television properties failed to cushion any declines in other areas of the company. Nickelodeon, for instance, has had well-publicized struggles with ratings, which caused ad sales in the television division to dip. Revenue in the media networks unit dropped 2 percent to $2.39 billion, while operating income fell 9 percent to $1.03 billion.
“Throughout the quarter, we kept our focus on creative excellence and strategic programming investment," Philippe Dauman, Viacom's chief executive officer, said in a statement. "Our ongoing investments in programming continue to produce results, with positive ratings trends and growing consumer engagement in new hit content, despite difficult short-term comparisons based on the mix of film releases and the lingering effect of ratings softness last year."