- Versant reported revenue of $1.59 billion, exceeding the $1.57 billion expected by analysts, according to Yahoo Finance. Net income fell 41.1% to $47 million.
- Linear distribution revenue declined 5.8% to $935 million, while advertising revenue fell 5.3% to $373 million despite stronger TV ratings.
- Platforms revenue grew 9.6% to $245 million, driven largely by Fandango, while the company raised its full-year free cash flow outlook.
Versant Media Group beat Wall Street’s revenue expectations in the third quarter, even as declines in cable distribution and advertising weighed on the parent company of MS NOW and CNBC.
Revenue fell 4.2% to $1.59 billion from $1.66 billion a year earlier, compared with the $1.57 billion expected by analysts, according to Yahoo Finance. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) declined 7.4% to $353 million compared with the prior year’s standalone results, while net income dropped 41.1% to $47 million.
The results highlight the challenge facing Versant in its first year as an independent publicly traded company following its January separation from Comcast: growing its digital businesses fast enough to offset continued declines in traditional pay television.
Linear distribution revenue declined 5.8% to $935 million, primarily due to subscriber losses that were partially offset by contractual rate increases. Advertising revenue fell 5.3% to $373 million, with Versant citing the timing of last year’s Ryder Cup as a factor. The company also pointed to stronger ratings and demand across its news and sports networks.
Versant’s television networks reached more than 120 million viewers monthly during the quarter, with aggregate viewership growing by double digits year over year. MS NOW also reported double-digit audience gains across key demographics and ranked as the second-most-watched cable network during the quarter.
The company completed four major distribution renewals this year, leaving 75% of its network subscribers under contract through 2028 or beyond. The agreements provide greater visibility into future carriage revenue as Versant navigates subscriber declines across the pay-TV industry.
“Versant’s momentum continues, with audience growth and the completion of all planned pay television distribution renewals for the year, underscoring the value and enduring appeal of our brands,” Versant CEO Mark Lazarus said in the earnings release.
Meanwhile, platforms revenue increased 9.6% to $245 million, driven largely by Fandango’s ticketing business and sales from its new cinema operating platform. Excluding the effects of the SportsEngine divestiture and Full Swing acquisition, platforms revenue grew 17.4%.
Versant launched MS NOW Membership in September, offering viewers access to the network’s live programming without a traditional cable subscription for $7.99 a month. On Monday, MS NOW expanded the service to connected-TV platforms including Roku, Apple TV and Amazon Fire TV, just ahead of the midterm elections.
CNBC is expected to launch its own direct-to-consumer offering in early 2027, while Fandango introduced a free, ad-supported streaming service in July. The initiatives are part of Versant’s efforts to build new revenue streams beyond traditional television.
Linear distribution still accounted for nearly 59% of quarterly revenue, compared with about 15% from platforms.
“Our third quarter performance demonstrates the financial discipline and flexibility that underpins Versant’s strategy,” Versant CFO and COO Anand Kini said in the earnings release. “We delivered strong Platforms revenue, continued operating efficiencies and significant cash flow.”
Versant also announced plans for another $100 million accelerated share repurchase during the fourth quarter, following a $100 million repurchase completed in the third quarter. The company declared a quarterly dividend of 37.5 cents per share.
Looking ahead, Versant reaffirmed its full-year revenue outlook of $6.2 billion to $6.45 billion and adjusted EBITDA guidance of $1.9 billion to $2.05 billion. The company now expects free cash flow to exceed its previous $1 billion to $1.2 billion forecast, after generating $302 million in the third quarter.