Viacom Says Its Turnaround Is On Track

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Viacom
Inc.

VIAB 2.01%

reported lessening declines in gross sales and rising revenue in the newest quarter, because the media firm works to show its turnaround plan stays on monitor.

Like different linear-television channel suppliers, Viacom suffers when viewers minimize their cable subscriptions due to each decrease promoting funds and a decline in affiliate income generated by subscription charges paid to cable firms. The corporate, which affords such channels as MTV, Nickelodeon and Comedy Central, stated Wednesday it has began to see sequential enchancment in these developments.

“We’re exiting the primary half of our fiscal 12 months with actual momentum and are enthusiastic about our return to progress as we head into the second half of the 12 months,” Viacom Chief Govt

Bob Bakish

stated on a name with analysts.

Though home promoting spending was down three% within the quarter, that was an enchancment from the earlier quarter. And the corporate stated it’s anticipating home advert gross sales to return to progress by its fiscal fourth quarter.

One of many elements driving that turnaround would be the progress of promoting merchandise that don’t depend on conventional tv rankings however relatively use information to higher goal viewers, which Viacom calls Superior Advertising and marketing Companies. That section grew 29% within the quarter and is on monitor to ship $300 million in incremental income by the top of the fiscal 12 months, Viacom Chief Monetary Officer

Wade Davis

stated on the decision.

One other issue will likely be what Viacom expects will likely be a powerful “upfront” spring advert gross sales season, when entrepreneurs purchase business time upfront of the approaching TV season. Mr. Bakish stated the shortage of promoting stock, brought on by industrywide rankings declines, has been driving up advert costs.

As for the corporate’s potential tie-up with

CBS Corp
.

, Viacom gave no replace Wednesday.

World-wide promoting and affiliate income was basically flat in Viacom’s newest quarter as worldwide progress offset home declines.

Income has additionally benefited from the expansion of streaming providers that carry its channels and usually pay increased charges than conventional distributors.

The corporate stated its Paramount Footage studio returned to profitability below new administration throughout the interval and has new momentum from the success of “A Quiet Place,” the primary launch from the present administration’s slate. Movie and leisure gross sales fell 14% to due fewer titles, however the section swung to a revenue on an adjusted foundation.

Wanting forward, the corporate touted a number of new cellular offers for its channels internationally and stated it’s in talks for related offers within the U.S. Mr. Bakish stated the corporate has obtained lots of curiosity from subscription streaming video providers about licensing its MTV and Nickelodeon mental property “for brand-new interpretation” on their providers, a mannequin he considered an “incremental” alternative.

General for its second quarter, Viacom reported a revenue of $256 million, or 64 cents a share, up from $121 million, or 30 cents a share, a 12 months earlier. On an adjusted foundation, earnings rose to 92 cents a share from 79 cents a share a 12 months earlier.

Income fell three.three% to $three.15 billion.

Analysts polled by Thomson Reuters had forecast earnings of 79 cents a share on $three.04 billion in income.

Viacom shares rose 2.6% in noon buying and selling. Shares have fallen zero.three% this 12 months, whereas the S&P 500 has declined 1.6%.

Write to Imani Moise at imani.moise@wsj.com and Keach Hagey at keach.hagey@wsj.com



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