CBS Corp. Sees Rise in Q4 Revenues, Tax Charge Impacts Profit


Revenues for the fourth quarter of 2017 increased 11 percent at CBS Corporation to a record $3.92 billion.

Content licensing and distribution revenues were up 33 percent, led by growth from both domestic and international licensing sales. Affiliate and subscription fee revenues were up 20 percent, driven by 31 percent growth in retransmission revenues and fees from CBS Television Network affiliated stations as well as growth from digital initiatives. Advertising revenues decreased 3 percent, facing a tough comparison against the year-ago period’s record political ad sales.

Net earnings from continuing operations were $40 million for the fourth quarter of 2017 compared with $271 million for the same quarter last year. This drop was largely due to a $129 million charge related to the recent changes in the U.S. tax law.

For Q4, the company reported a net loss of $41 million compared with a net loss of $113 million for the fourth quarter of 2016.

Entertainment revenues of $2.82 billion were up 18 percent from the same prior-year period. This increase was led by 38 percent growth in content licensing and distribution revenues, with strong growth in both domestic and international licensing sales. Affiliate and subscription fees also contributed to the revenue increase, up 40 percent, led by higher station affiliation fees and growth from digital initiatives. Ad revenues increased 4 percent, driven by the inclusion of the results of Network Ten.

Entertainment operating income was up 25 percent at $465 million, primarily reflecting the revenue growth, which was partially offset by an increased investment in programming, including costs for CBS All Access.

Cable networks delivered revenues of $547 million for the fourth quarter, an increase of 9 percent, helped by higher revenues from the Showtime digital streaming subscription offering and growth from the licensing of Showtime content. Cable networks operating income of $201 million for Q4 was down 8 percent, reflecting an increased investment in programming.

“I’m very pleased to report that CBS turned in outstanding fourth-quarter results, including double-digit revenue growth and our 32nd consecutive quarter of EPS growth, capping off a very strong year in 2017,” said Leslie Moonves, chairman and CEO of CBS Corporation. “The CBS Corporation produces many of the most-valuable programming franchises in the world, reaching more viewers than anyone else. This gives us a tremendous advantage as streaming becomes more central to our distribution strategy. As a result, we now have nearly five million subscribers at CBS All Access and Showtime OTT combined. When you add this to our retrans and skinny bundle subscribers, our total subscriber base continues to grow at an accelerated pace. With the backdrop of this changing business model, and the completed separation of our radio business during the fourth quarter, we now have even greater visibility into our operations. Specifically, we expect 2018 to be another strong year for the CBS Corporation, with revenue growth in the high-single digits and EPS growth in the high teens from the record $4.40 we’re reporting to you today. So we feel very good about the growth path before us, and we continue to have great confidence in our ability to deliver for our shareholders.”