Profit plunged, but growth in Paramount's subscription services helped boost quarterly revenue at the media giant. Fred Katayama reports.
The latest installment of the "Teenage Mutant Ninja Turtles" series was a box office disappointment for Viacom, yanking down its quarterly profit 27 percent. Also hurting earnings: the slump at its media networks business that was hit by a fall in ad revenues amid lower ratings. But the media company surprisingly managed to boost revenue, thanks to 30 percent growth in licensing of movie rights to TV services. Paramount Television's subscription video-on-demand services did particularly well. That unit helped Viacom offset the revenue decline at its media networks division that includes Nickelodeon, MTV, and Comedy Central. But FBR analyst Barton Crockett said, "We are encouraged that Nickelodeon is improving and see asset value that could be unlocked." All this comes amid a fierce legal battle pitting controlling shareholder Sumner Redstone against CEO Philippe Dauman and other Viacom directors. Redstone has opposed Dauman's plan to sell a stake in Paramount. Dauman told analysts Thursday the sale process has slowed down but was still on track.