AMC Networks reported its second-quarter 2020 earnings Tuesday, which saw a 14.6% decrease to $187 million in advertising revenue domestically, a drop that it attributed primarily to the coronavirus pandemic. Still, the Josh Sapan-led company beat on analysts’ forecasts for both earnings and revenue in the coronavirus-plagued quarter.
At national networks — which includes AMC Networks’ AMC, BBC America, IFC, SundanceTV, and WE tv, along with AMC Studios — AMC Networks says ad sales were down was because of “lower demand” and “the timing of the airing of original programming,” in a quarter that saw the company have to push both “The Walking Dead” Season 10 finale and “The Walking Dead: World Beyond” series premiere from their planned April 12 airdate due to COVID-forced production shutdowns.
AMC aired one episode of “The Walking Dead” in the quarter which ended June 30, as well as a few episodes of “NOS4A2,” “Better Call Saul,” and Jason Segel’s limited series “Dispatches From Elsewhere.”
Wall Street forecast earnings per share (EPS) of $1.23 on $625.94 million in revenue, according to a consensus compiled by Yahoo Finance. AMC Networks reported adjusted EPS of $2.39 on $646.29 million in revenue.
That revenue figure was down 16.3% from Q2 2019. Net income of $15 million dropped from $129 million in last year’s comparable quarter.
Revenue at AMC, BBC America, IFC, SundanceTV, WE tv and AMC Studios declined 18% from the same quarter in 2019. Their operating income fell 12.4%, with an adjusted decrease of 11.2%.
Internationally and “other” revenues, which includes AMC Networks’ SVOD services, Acorn TV, Shudder, Sundance Now and UMC (Urban Movie Channel), were down 10.3%.
As part of the Tuesday filing, the company says it’s “delivered impressive year-over-year growth in revenues and subscribers” across its four SVOD platforms. After reporting its first-quarter 2020 earnings, AMC Networks said it now expects to see 3.5 million to 4.0 million paid subscribers between Acorn TV, Shudder, Sundance Now and UMC (Urban Movie Channel) by year-end 2020. That is two years ahead of its self-set pace.
During Q2, AMC Networks launched new SVOD bundles AMC+ and WE tv+. On July 1, the company signed a deal with Lionsgate to regain the rights to air “Mad Men” on both TV and streaming in October. AMC last aired the series during its seven-season run from 2007-2015.
Most media companies were financially rocked in the second quarter of 2020, which is when the greatest impact (thus far, at least) of the coronavirus shutdown was felt.
“Amidst a continuing challenged and uncertain environment, AMC Networks delivered solid results in the 2nd quarter exceeding our financial expectations for the quarter and expectations on several key metrics, including advertising,” AMC Networks President and CEO Josh Sapan said in a prepared statement. “We continue to maintain a strong financial profile, with a solid balance sheet and liquidity, and we continue to generate healthy levels of free cash flow. We remain focused on our strategic priorities and are making progress on our major initiatives – which include creating great content and monetizing that content across an expanding array of platforms.”
“Last week, AMC Networks was recognized with 18 Emmy nominations, including two out of the eight nominations for Outstanding Drama, for our original series ‘Better Call Saul’ and ‘Killing Eve,’ demonstrating our continued ability to stand out in a crowded landscape with compelling character-driven stories that drive the cultural conversation. In addition, we have made particular progress during this COVID period with strong growth across our targeted SVOD services – Acorn TV, Shudder, Sundance Now and UMC – as consumers increasingly subscribe to both our targeted offerings in addition to general entertainment SVOD services.”
AMC Networks stock (AMCX) closed Monday at $23.93 per share. The regular U.S. stock markets will reopen at 9:30 a.m. ET.
Sapan and other AMC Networks executives will host a conference call at 8:30 a.m. ET to discuss the quarter in greater detail.