Paramount Global added global streaming subscribers in the second quarter to reach “nearly 64 million” as of the end of June, up from more than 62 million as of the end of March. The latest period saw the addition of 5.2 million subscribers, partially offset by the removal of 3.9 million subscribers in Russia due to the country’s invasion of Ukraine.
The entertainment conglomerate revealed the latest figures on Thursday as part of its quarterly earnings report, which saw its revenue exceed Wall Street expectations with a 19 percent gain to $7.78 billion, TV media unit advertising revenue drop and strong gains in the film unit, driven by such recent hit releases as Top Gun: Maverick.
The company detailed in its results that its Paramount+ streaming platform added 4.9 million subscribers in the March-June period, partially offset by the removal of 1.2 million Russia subscribers, to hit “over 43 million” subscribers, compared with around 39.6 million as of the end of March.
“Paramount+ captured the most sign-ups, gross and net subscriber additions of any premium domestic streaming service in the quarter according to Antenna’s June 2022 Report,” Paramount noted in its earnings report. “Paramount+ subscriber growth was partially driven by successful international market launches, including the U.K., Ireland and South Korea.”
The company also touted its streaming content lineup. “Paramount+’s broad content strategy continued to draw audiences in the quarter, including highly anticipated original series, movies and sports,” it said. “Paramount+ saw strong acquisition and engagement from a variety of content, led by Halo, 1883, The Lost City, Sonic the Hedgehog 2, Jackass Forever, Star Trek: Strange New Worlds and the UEFA Champions League (soccer tournament). Both domestic and international hours watched per household demonstrated strong growth year-over-year.”
In the fourth quarter of 2021, Paramount, led by president and CEO Bob Bakish, had added a company record 9.4 million global subscribers to its pay streaming offerings, which also include Showtime OTT.
Paramount’s free, advertising-supported streaming service Pluto TV also continued to grow its monthly active users, or MAUs, to nearly 70 million as of the end of June after hitting “nearly” 68 million as of the end of March. Pluto TV grew total global viewing hours by double digits year-over-year for the
second consecutive quarter, Paramount noted, also touting the service’s “expanded international presence.”
Paramount’s film unit released Top Gun: Maverick during the second quarter, with the company on Thursday touting the success of the Tom Cruise movie and other recent releases. Film unit revenue jumped 126 percent in the second quarter to $1.36 billion, “led by the strong performance of current quarter theatrical releases, with theatrical revenue increasing by $630 million, “primarily driven by the releases of Top Gun: Maverick and Sonic the Hedgehog 2 in the quarter.” Licensing and other revenue in the film division grew 27 percent, “primarily driven by the monetization of recent theatrical releases.” Adjusted operating income before depreciation and amortization in the film unit increased by $129 million to hit $181 million, “reflecting the strong performance of current year releases.”
Meanwhile, Paramount’s TV Media unit posted an advertising revenue drop in the second quarter after a 13 percent decline in the first quarter. “Advertising revenue decreased 6 percent year-over-year, as pricing only partially offset the impact of lower linear impressions and foreign exchange,” the firm said.
In his earnings preview, Wells Fargo analyst Steven Cahill had forecast 4 million Paramount+ subscriber net additions in the second quarter, or 5 million when excluding Russia, but only 1.3 million total streaming net adds “due to some weakness at Showtime and a (negative) 2 million impact from non-Paramount+ Russia subs.” He suggested that Showtime OTT, Noggin and BET+ collectively lost around 600,000 subs.
“We think Paramount+ benefited from Halo, the Sky Cinema deal in the U.K., and a few hundred thousand net adds from the T-Mobile U.S. deal,” Cahall wrote. “We think the Sky Cinema deal in totality could add around 9 million subs, with additional Sky market launches expected in the fourth quarter. We estimate non-Paramount+ net adds of -2.7 million, driven by a severed low average revenue per user distributor deal in Russia impacting net adds by 2 million. The cumulative impact from Russia on direct-to-consumer (DTC) subs is 3 million, including -1 million to Paramount+. Our total DTC net adds estimate is 1.3 million versus 2.7 million consensus, though our Paramount+ net adds are in-line.”