We've Got Hollywood Covered

Viacom Blames Soft ‘Ninja Turtles,’ Redstone Drama for Lower Earnings Forecast

”Highly public governance controversy“ has hurt timing of a big SVOD deal, company says

Viacom is being proactive in tempering earnings expectations for its current fiscal quarter.

In a statement issued Friday, the media company said the “disappointing” box office performance of “Teenage Mutant Ninja Turtles: Out of the Shadows” and the delay in completing a “significant” SVOD agreement are to blame for a more pessimistic Q3 outlook.

That latter issue can be attributed to what the company called “recent and highly public governance controversy” — in other words, the ugly and ongoing fight between CEO Philippe Dauman and Sumner and Shari Redstone, who head the National Amusements holding company that controls 80 percent of Viacom.

Earlier this morning, Viacom revealed via an SEC filing that it will foot the legal and public relations bills for Dauman and fellow board member George Abrams in their lawsuits against Sumner M. Redstone and National Amusements, Inc. (NAI).

“Viacom expects to report adjusted diluted earnings per share within the range of approximately $1.00 to $1.05 for the third quarter of 2016,” the company said on Friday.

That’s way down from the average analyst estimate compiled by Yahoo Finance, which had forecast about $1.38 in earnings per share for the quarter ended June 30, 2016.

The company now forecasts domestic advertising sales declines for this third quarter to be down about 4 percent. On the bright side there, Viacom said the current upfronts ad sales period is moving along quite swiftly for its many cable channels, which include Comedy Central, MTV, and Nickelodeon, among others.

Dauman and Abrams were yanked from the NAI Board of Directors earlier this spring. National Amusements also moved Thursday to remove the two and three other directors from the Viacom Board altogether.

Please fill out this field.