Time Warner raised its full-year profit forecast as its cable channels delivered revenue higher than expected in the third quarter. A 3 per cent rise to $6.24 billion, ahead of Wall Street’s forecasts, reflected growth at HBO and Turner.
The company has been cutting staff and restructuring its businesses as it looks to spur profitability after it rejected of an $85-a-share bid from Rupert Murdoch’s 21st Century Fox. Jeff Bewkes, chief executive, told investors last month that the company would double earnings by 2018.
Revenue was higher at the Turner television networks, HBO and the Warner Bros movie studio. But costs rose as the company cancelled some Turner programming, restructured across its units and paid out severance.
Third-quarter net income fell to $967 million from $1.18 billion a year earlier. This year the company is cutting 10 per cent of its workforce at Turner, 7 per cent of HBO staff and nearly 13 per cent of jobs at its Warner Bros film unit.
Bewkes has announced plans to invest more in original programming and compete for the attention of a growing group of younger consumers who are watching more TV and movies online. Last month HBO said it would sell subscriptions to viewers who do not pay for traditional cable or satellite packages.