Aided by income tax cuts, AMC Networks reported better-than-expected Q3 earnings on Thursday, but the company whiffed on revenue estimates as domestic ad sales declined.
Wall Street had forecast earnings per share of $1.66 on revenue of $733.95 million, according to a consensus estimate compiled by Yahoo Finance. AMC Networks posted Q3 adjusted earnings per share of $2.33 on revenue of $718.60 million.
Domestic ad sales, referring to the national networks of AMC, We tv, BBC America, IFC and SundanceTV, dropped 2.6% with no “Better Call Saul” (pictured above) on AMC, which aired all but two of the “Breaking Bad” prequel’s Season 4 episodes in Q3 2018. Season 5 is expected next year.
Though revenue disappointed media analysts, it did rise 3.1% over last year’s third quarter.
“AMC Networks is well on its way to strategically transforming itself from a ‘cable channels company’ into a premier content company with a suite of focused and targeted video entertainment products that are delivered to viewers on an expanding array of platforms,” President and CEO Josh Sapan said in prepared remarks accompanying his financial results. “The underlying strategic priorities fueling our transformation have been and continue to be creating and owning great content and valuable IP, expanding our targeted direct-to-consumer services, maximizing the long-term value of our traditional linear business and diversifying our revenue by developing new avenues of content monetization.”
“Recent successes include our Acorn TV streaming service surpassing one million subscribers, an outsized presence at this year’s Emmy Awards with a number of key wins and a recent agreement with Charter Communications to launch our full suite of focused streaming services — Acorn TV, Shudder, Sundance Now and UMC — and our commercial-free AMC Premiere offering on their Spectrum platform,” he continued. “We are optimizing the value and reach of our content in a variety of ways and executing on a plan that will enable us to thrive in a very dynamic and competitive environment.”
AMC Networks stock (AMCX) closed Wednesday at $43.85 per share. The U.S. stock markets will reopen for their regular trading day at 9:30 a.m.
Sapan and other senior executives will host a conference call at 8:30 a.m. ET to discuss the quarter in greater detail.