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Strong ad sales and streaming revenue fuel ViacomCBS Q2 earnings

ViacomCBS released its second quarter report on Thursday (Aug. 5), which was highlighted by 6.5 million new streaming subscribers, boosting the company’s total to 42 million global paid users. Overall, ViacomCBS’s global ...
August 5, 2021

ViacomCBS released its second quarter report on Thursday (Aug. 5), which was highlighted by 6.5 million new streaming subscribers, boosting the company’s total to 42 million global paid users.

Overall, ViacomCBS’s global streaming revenue increased 92% year-over-year thanks to subscription and advertising growth. Streaming advertising revenue especially soared with an increase of more than double at 102% this quarter to $52 million, driven by advertising growth on digital video platforms like Paramount+ and especially Pluto TV, which saw its revenue more than double for the fourth consecutive quarter.

The report made clear that the positive streaming subscription results were largely fueled by the success of Paramount+, ViacomCBS president and CEO Bob Bakish noted.

“In a quarter of strong business performance, including growth in advertising and affiliate, streaming was a standout,” Bakish said in the 2021 Q2 earnings report.

“This growth was driven by the power of the service’s differentiated content strategy and expanding content slate. Looking ahead, we’re excited about our opportunity to build on this momentum, as we scale Paramount+’s content offerings across genres, and expand our reach with global audiences.”

ViacomCBS reported that domestically, Paramount+ originals drove strong subscriber sign-ups and engagement, with top highlights including the new iCarly series, Infinite, UEFA Champions League, The Challenge: All Stars and Why Women Kill. Total viewing hours and watch time also grew quarter-over-quarter. The company also noted Showtime OTT delivered strong growth driven by originals like The Chi, Shameless and City on a Hill.

Global Pluto TV MAUs exceeded 52 million in this quarter, as revenue surged 169% year-over-year.

Total company revenue at ViacomCBS increased 8% year-over-year, driven primarily by higher streaming, advertising and affiliate revenue, and partially offset by lower licensing revenue. Advertising revenue on the whole also increased 24% year-over-year for the company, driven by an improved market and a favorable impact of foreign exchange rate changes, though partially offset by lower ratings.

Advertising revenue for the company as a whole increased 24% year-over-year, driven by an improved advertising market and CBS’ 2021 sports broadcasts, for which there were no comparable broadcasts last year due to the COVID-19 pandemic. Affiliate revenue, meanwhile, increased 9% year-over-year reflecting expanded distribution and higher reverse compensation and retransmission fees.

Some decline was seen in licensing and other revenue, which dropped 36% year-over-year, primarily reflecting the licensing of domestic streaming rights to South Park in the prior year, and the impact on film licensing with the absence of theatrical film releases through most of 2020 and the start of 2021.

Paramount+ expansion

A major part of ViacomCBS’s Q2 report was the company’s plans to accelerate Paramount+’s global expansion to parts of Europe in 2022.

The streaming service will launch on Sky platforms in the UK, Ireland, Italy, Germany, Switzerland and Austria in 2022 as part of a new multi-year distribution agreement. The extended carriage of ViacomCBS’s portfolio of pay TV channels and the renewal of Sky as an ad sales partner in some markets is also included in the agreement.

The agreement makes Paramount+ the latest app to come to Sky Q, adding more than 10,000 hours of content. Through the partnership, Paramount Pictures’ feature films will remain available on Sky Cinema in the UK and will join Sky Cinema in Germany and Italy in 2022. Other Sky customers will be able to subscribe to Paramount+ as an add-on to their account.

“This transformative distribution deal is key to accelerating our global ambitions in streaming while also supporting Sky’s strategic objectives to better serve audiences with greater flexibility in how they consume our content across all platforms,” said Raffaele Annecchino, president and CEO of ViacomCBS Networks International in a press release.

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