CBS Corp. Revenue Rises with Higher Ad Sales

NEW YORK: CBS Corporation reported a 3 percent rise in its fourth-quarter revenue on higher ad sales, thanks in part to Thursday Night Football as well as the midterm elections.

Revenue for Q4 was at $3.68 billion, with a 4 percent increase in advertising revenues. Affiliate and subscription fees grew 11 percent, reflecting continued increases in retransmission revenues, fees from CBS Television Network affiliated stations, and cable affiliate fee revenues. Content licensing and distribution revenues declined 3 percent because of the timing of theatrical releases, which offset higher TV licensing revenues.

Net earnings of $413 million were down from the prior year's Q4, which posted $470 million.

Entertainment revenues—CBS Television Network, CBS Television Studios, CBS Global Distribution Group, CBS Interactive and CBS Films—of $2.26 billion for the fourth quarter of 2014 grew 2 percent from the same prior-year period. The increase was driven by higher advertising revenues, principally from CBS's broadcast of Thursday Night Football, and growth in affiliate and subscription fees. Content licensing and distribution revenues declined 2 percent as a result of the timing of theatrical releases. Entertainment OIBDA for the fourth quarter of 2014 was $287 million, down from $418 million for the same prior-year period. The decline was the result of higher investment in TV programming, primarily associated with NFL broadcasts. Operating income for the fourth quarter of 2013 included restructuring charges of $12 million.

Cable Networks revenues of $499 million for the fourth quarter rose 5 percent from $477 million for the same quarter in 2013. The increase resulted from higher affiliate revenues from growth in rates at Showtime Networks, CBS Sports Network and Smithsonian Networks, as well as higher revenues from the licensing of Showtime original series. Cable Networks OIBDA of $247 million for the fourth quarter of 2014 increased 24 percent from $199 million for the same prior-year period, primarily driven by revenue growth and lower programming costs as a result of the timing of premieres.

"CBS's content continues to engage viewers around the world and create tremendous value for its shareholders," said Sumner Redstone, executive chairman of CBS Corporation. "I'm extremely proud of all that we are doing to evolve into the digital future, and I'm certain that Les and his team are pursuing a winning strategy to keep CBS on top of its game for many, many years."

"This was a very strong quarter with growth in both revenue and EPS, and at the heart of it all is the increased demand for our content," said Leslie Moonves, the president and CEO of CBS Corporation. "It all starts with the CBS Television Network, which remains No. 1 and is growing its audience from year to year. With a balanced schedule of new and established hits, the return of Thursday Night Football next fall, and Super Bowl 50 on CBS in 2016, we are continuing to build momentum from a position of strength. As a result, affiliate fees are growing at a rapid clip. During the quarter, we made significant progress in retransmission consent and reverse compensation by completing another round of new deals, each time at higher rates that place fair value on our content. We also recently expanded our streaming platform by licensing CSI for the first time. And we have begun to expand the global reach of Showtime in a whole new way through our deal with Bell Media in Canada. At the same time, our commitment to shareholders remains as strong as ever. We repurchased $800 million of CBS stock during the fourth quarter—double what we did in the third—and we plan to pick up the pace even more here in the first quarter with a target of $1 billion. Thanks to our continued investment in world-class content and our strong financial position, we are well poised for future growth."