Here’s the Situation: Viacom Profits Pumped by ‘Jersey Shore,’ Jon Stewart

Popular cable shows help advertising grow 8 percent, offsetting decline in studio profit; company plans to sell Harmonix, “Rock Band”

Last Updated: November 11, 2010 @ 7:25 AM

Viacom reported its quarterly earnings on Thursday, with strong results driven by advertising increases and growth at MTV and Comedy Central, where "Snooki" and "The Situation" are just as important in driving profits as Jon Stewart and Stephen Colbert.

Viacom’s revenues in the quarter ended September 30 increased 5 percent (to $3.33 billion). Adjusted operating income ($837 million) was up 4 percent on ad growth (8 percent in the U.S.) – though it was partially offset by a decline in profit from its Paramount film division.

Also on Thursday, Viacom announced plans to sell Harmonix, the video game studio responsible for the once-mighty “Rock Band” music video game franchise — effectively exiting the console gaming industry.

Viacom president and CEO Philippe Dauman said the company wants to focus its future on its core business: content distributed across platforms — and Harmonix is apparently not part of that plan.

“There’s never, ever been a better time to be in the content business,” executive chairman Sumner Redstone said at the top of the company’s earnings call. “Content has been our past and it will be our future.”

"Investing in our content and our brands has been and will continue to be the cornerstone of Viacom's strategy," Dauman said. "We never wavered from it even as we managed through the global recession."

During the investor call, Dauman boasted that the company’s cable shows — including “Jersey Shore” and “The Daily Show With Jon Stewart” — are “the most talked-about, blogged-about and tweeted-about shows on television.” Dauman noted that the 8 percent bump in advertising revenue at the networks was the third consecutive quarterly increase in that category.

A 9 percent increase in profit (to $873 million) at its media networks was offset in the overall profit mix by a $21 million slide in Paramount's film profit ($52 million) — which Dauman attributed to “the timing and mix of theatrical releases” and, in particular, a “difficult year-over-year comparison” its 2009 tentpole, “Transformers: Revenge of the Fallen.”

But Dauman said its studio “is off to a great start in fiscal 2011 with the box office success of ‘Jackass 3D’ and ‘Paranormal Activity 2.’"