Viacom Stock Surges On Mixed Fiscal Q1 Results


It’s another turbulent day on Wall Street, with the Dow Jones Industrial Average losing 231.64 points just one hour into Thursday’s trading session. Yet, things are downright rosy for holders of Viacom’s Class B shares.

Shares were up 8% as of 11am Eastern, giving a much-need boost to the company’s shaky stock. At the Closing Bell, Viacom finished at $32.71, up 7.2%.

Viacom reported net earnings of $537 million ($1.33 per share) in its fiscal Q1, up from $396 million ($1) in the previous quarter.

On a non-GAAP basis, the company’s diluted EPS from continued operations came in at $1.03, slipping from $1.04.

This beat the Zacks Equity Research consensus estimate of 95 cents.

Here’s the rub: Viacom’s revenue slipped by 8% in the quarter, to $3.07 billion from $3.32 billion. This missed the Zacks Consensus Estimate of $3.14 billion.

For Viacom, the net income growth is key to President/CEO Bob Bakish‘s long-term master plan. “In the quarter, Viacom aggressively drove progress on our strategic plan, delivering improvements in our business and positioning the company for the future,” he said.

He touted growth in viewers for “Viacom’s most-watched portfolio of domestic cable brands.”

For Viacom International Media Networks, which has a large presence in Miami, “double-digit top-line and bottom-line Media Networks gains” continue as the company launches what Bakish calls “innovative new partnerships in growth territories around the world.”

Viacom in November 2016 purchased Buenos Aires-based Argentine TV giant Telefe for $345 million USD.


Like many media companies, monetizing digital platforms is essential in today’s age.

Viacom is making “considerable progress,” Bakish says, in the company’s push to accelerate consumption and monetization on next-generation platforms, “achieving substantial growth in worldwide digital advertising revenues, expanding distribution on fast-growing virtual MVPD and mobile services, and ramping up resources and talent at Viacom Digital Studios.”

Expanding Viacom’s digital capabilities has extended to the company’s purchase of influence marketing firm WHOSAY and VidCon, which Bakish calls “the world’s premier online video event.”

Additional income sources such as live events, hospitality and consumer products are also yielding positive results, with the premiere of SpongeBob SquarePants as a Broadway musical getting much pre-opening buzz and promotional ads on Spotify.


Don’t cry over Argentina, Viacom stockholders.

While Media Networks revenues decreased 1% to $2.56 billion in the company’s fiscal Q1, international revenue surged 13% in the quarter (when excluding a five percentage point favorable impact from foreign exchange). This was primarily driven by a six percentage point favorable impact from the Telefe purchase, in addition to growth in Europe. International advertising revenues increased 22% to $371 million.

In the U.S., it’s a different story: Domestic revenue declined 6%, to $1.93 billion. Domestic advertising revenues decreased 5% to $937 million, reflecting lower linear impressions partially offset by higher pricing, as well as growth in digital advertising revenue.

Furthermore, domestic affiliate revenues decreased 8% to $907 million, primarily due to subscriber declines and lower SVOD revenues. This was partially offset by rate increases.