Paramount Global (NASDAQ:PARA) shares retreat Wednesday on third-quarter numbers. The company reported $6.92 billion in revenue in Q3, an increase of 5% year-over-year. Yet the company’s results missed expectations as it suffered from cord cutting and a drop in advertising revenue.
Adjusted EPS proved to be 39 cents, in contrast to the expected 43 cents, on revenue of $6.92 billion, vs $7.01 billion expected
Paramount said revenue for its TV media segment – which includes broadcast network CBS and cable-TV channels such as MTV, Nickelodeon and premium network Showtime – was down 5% to about $4.9 billion compared to the previous quarter as pay-TV subscriber numbers declined.
Advertising revenue for the segment also dropped, a sign that macroeconomic headwinds are beginning to hit. Paramount said advertising revenue for its TV networks was down 3% to about $1.9 billion.
Over the summer, Paramount warned that it began to feel a slowdown in the advertising market.
The company noted it also restructured some of its international affiliate TV agreements during the quarter, which shifted revenue from pay-TV services to streaming.
The company’s direct-to-consumer streaming segment performed better, however. Paramount+, the company’s answer to premium subscription services like Netflix and Disney+, added 4.6 million subscribers, bringing its total to 46 million customers. Paramount+ also lost 1.9 million subscribers during the quarter as SkyShowtime, its joint venture with Comcast in Europe, launched in the Nordics and replaced Paramount+.
PARA began Wednesday down $1.84, or 9.6%, to $17.33.