Paramount sees streaming losses narrow, but advertising decline takes toll

Paramount Global saw its streaming losses narrow slightly in the second quarter of the year, but the CBS and Nickelodeon operator was buffeted by advertising declines over the same period.

Paramount+ now claims 61 million subscribers worldwide, up one million on Q1, while the streaming loss of $424m loss was an improvement on both the same time last year ($445m) and on Q1 this year ($511m).

The studio, whihc is behind shows such as 1923 and Special Ops: Lioness, said revenue from streaming was up 40%, with Paramount+ up 47% year-on-year and FAST network Pluto also assisting the improvement, but advertising revenue at its networks dropped 10% on the same time last year.

It was the third successive decline of advertising revenues in as many quarters, following an 11% drop in TV ad revenue in Q1 and a 7% fall Q4 of 2022.

Paramount CEO Bob Bakish added that international originals – in which there are 85 now either produced or greenlit – would help the organisation stay “nimble” as the ongoing writers and actor strike rumbles on.

Paramount+ is set to offer shows such as The Gold – originally produced for the BBC in the UK – and Bargain, Queen Woo from Korea, but he admitted that the US strikes were providing challenges around marketing of new shows.

He added that Paramount “remains hopeful for a timely resolution”, adding that the studio is “committed to finding a path forward”.

Softness & Showtime savings

The results reflect the ongoing challenges facing the US studios, with Paramount CFO Naveen Chopra admitting the addition of just one million subscribers reflected the “seasonal softness”.

Chopra added that the “strategic shift” of releasing programming to coincide with the launch of Showtime on Paramount+ was also a factor, while CEO Bob Bakish talked up the potential of broader partnerships.

“We’ve been believers in bundling for a long time. Bundling has been one of the tried-and-tested methods of value creation in media and certainly as we enter the streaming space, bundling is part of our strategy,” he told investors.

Paramount has already partnered with Comcast across swathes of Europe with the launch of SkyShowtime, and Bakish admitted that the studios is looking at other “incremental opportunities” in bundling services.

Bakish added that combining Paramount+ and Showtime into one service had created $700m in savings.

Away from TV and streaming, revenue at Paramount’s film arm fell 39% year-on-year, largely because of the success of Top Gun: Maverick during the same period last year.

Paramount also confirmed today it has completed the sale of its publishing division, Simon & Schuster, to private equity firm KKR for $1.62bn.