Paramount+ adds 2.7m subs in Q3
November 3, 2023
Paramount Global has reported Q3 financial results to September 30th 2023, with strong growth in both DTC revenue and streaming subscribers.
Bob Bakish, Paramount Global CEO, commented: “We continue to execute our strategy and prioritise prudent investment in streaming while maximising the earnings of our traditional business. In Q3, we successfully grew Direct- to-Consumer revenue and Paramount+ subscribers while narrowing DTC losses over 30 per cent. In fact, we now expect DTC losses in 2023 will be lower than in 2022 – meaning streaming investment peaked ahead of plan. Looking ahead, we remain on the path to achieving significant total company earnings growth in 2024.”
Q3 Direct to Consumer Highlights
▪ Revenue increased 38 per cent year-over-year.
– Subscription revenue grew 46 per cent to $1.3 billion (€1.22bn), driven by subscriber growth and pricing increases for Paramount+, and revenue from pay-per-view events.
– Advertising revenue rose 18 per cent, reflecting growth from Paramount+ and Pluto TV.
▪ Global viewing hours across Paramount+ and Pluto TV grew 46 per cent.
– Paramount+ revenue grew 61 per cent, driven by subscriber growth and increased advertising revenue.
▪ Paramount+ subscribers reached more than 63 million, with 2.7 million net additions in the quarter.
▪ Paramount+ global ARPU expanded 16 per cent year-over-year.
▪ Adjusted OIBDA improved 31 per cent as higher revenue more than offset incremental costs to support the growth of Paramount+.
– The company now forecasts full-year DTC losses in 2023 will be lower than in 2022, with DTC losses in Q4 2023 similar to Q4 2022
Q3 TV Media Highlights
▪ Revenue was $4.6 billion.
– Affiliate and subscription revenue was substantially flat. Lower affiliate revenue was offset by revenue from pay-per-view events.
– Advertising revenue decreased 14 per cent, reflecting continued softness in the global advertising market and lower political advertising.
– Licensing and other revenue decreased 12 per cent, driven by lower revenue from original content produced for third parties. Content available for licensing was impacted by temporary production shutdowns as a result of strikes.
▪ Adjusted OIBDA was over $1.1 billion equating to a 25 per cent Adjusted OIBDA margin.
– Adjusted OIBDA decreased 7 per cent, reflecting the revenue decline, partially offset by lower costs for content and marketing.
Q3 Filmed Entertainment Highlights
▪ Revenue increased 14 per cent year-over-year.
– Theatrical revenue grew 63 per cent, primarily driven by the releases of Mission: Impossible – Dead Reckoning Part One and Teenage Mutant Ninja Turtles: Mutant Mayhem.
▪ Debut of Paw Patrol: The Mighty Movie drove consumption of the broader franchise, with the Paw Patrol library serving as a top engagement driver on Paramount+.
– Licensing and other revenue decreased 7 per cent, reflecting the prior year success of Top Gun: Maverick in the digital home entertainment market and lower revenue from studio rentals and production services as a result of strikes.
▪ Adjusted OIBDA was a loss of $49 million. The decrease from the prior year reflects the timing and mix of theatrical releases in each year as well as incremental costs incurred during production shutdowns and lower revenue from studio rentals and production services.