CBS Corporation Posts Q1 Revenues of $3.34 Billion

CBS Corporation has reported results for the first quarter of 2017, posting revenues of $3.34 billion, down from the $3.59 billion recorded in Q1 2016.

The first quarter of last year was when the CBS Television Network broadcast Super Bowl 50 and an additional NFL playoff game. Excluding these two noncomparable games, first-quarter revenues would have been up high-single digits. Affiliate and subscription fee revenues increased 17 percent, driven by 28 percent growth in retransmission revenues and fees from CBS Television Network-affiliated stations, as well as the company’s digital subscription services. Content licensing and distribution revenues gained 16 percent, led by higher domestic and international television licensing sales.

Operating income for the first quarter of 2017 was $704 million, compared with $765 million for the same prior-year period, again due to the noncomparable NFL games. Net earnings from continuing operations were $454 million for Q1 2017, compared with $442 million for the same quarter last year.

The entertainment segment—CBS Television Network, CBS Television Studios, CBS Studios International, CBS Television Distribution, CBS Interactive and CBS Films—saw revenues of $2.35 billion, down 9 percent. Entertainment operating income of $398 million for the first quarter of 2017, down 11 percent. Again, both were impacted by the NFL games.

Revenues for the cable networks—Showtime Networks, CBS Sports Network and Smithsonian Network—was $543 million, up 3 percent. The increase was driven by higher affiliate and subscription fees, led by growth of the Showtime digital streaming subscription offering, which was partially offset by the timing of international television licensing sales of Showtime original series.

“Our first-quarter results once again demonstrate the strength of our strategy, which is to diversify our revenue mix as we achieve our long-term financial goals,” said Leslie Moonves, the chairman and CEO of CBS Corporation. “Retransmission consent and reverse compensation led the way in Q1, growing 28 percent. This contributed to a 17 percent increase in our company’s affiliate and subscription fee revenue, which also benefited from our over-the-top subscription services, CBS All Access and Showtime OTT. In addition, we had a very solid quarter for content licensing and distribution, which was up 16 percent and is poised for continued strength when several of our hit series enter the syndication cycle later this year. And we continue to add to our content pipeline all the time. In two weeks we will unveil our new prime-time schedule on the CBS Television Network, which will include 19 returning series further strengthened by several new shows, the majority of which we will own. We look forward to the upfront marketplace where we’re confident advertisers will once again place great value on the number one television network in an increasingly fragmented media landscape. And longer term, that content becomes even more valuable when we license it across distribution services, both here in the U.S. and internationally as well. As we continue to sharpen our core content focus in the quarters to come, including the impending split-off of our radio business, we will be even better positioned to take advantage of all of the opportunities before us. So there is so much yet to come, and roadmap for success is clear.”