Time Warner Inc. posted a strong first quarter thanks in part to growth at HBO and Turner.
“Home Box Office shined in the quarter highlighted by our limited series ‘Big Little Lies,’ which was both a critical and cultural breakout. ‘Last Week Tonight with John Oliver’ is having its most-watched season to date, and we recently had the much-anticipated returns of ‘Silicon Valley’ and ‘Veep,’” said Time Warner CEO Jeff Bewkes in a statement.
Time Warner’s revenue grew 6% to $7.7 billion and operating income increased 4% to $2.1 billion, due to growth at Home Box Office and Warner Bros. and lower corporate expenses, partially offset by a decrease at Turner and higher intersegment eliminations, according to a news release.
At HBO, revenues increased 4% to $1.6 billion thanks to an increase of 5% in subscription revenues. Operating income increased 22% to $583 million.
At Turner, revenues increased 6% to $3.1 billion, thanks to a 12% increase in subscription revenues and a 16% increase in content and other revenues, both of which helped to fend off a 2% decline in advertising revenues. Interestingly, the dip in ad revenues for Turner came amid a quarter featuring what the network called the second most-watched NCAA March Madness tournament in 23 years, with viewership up 16%.
The upbeat results for Time Warner come as HBO announced it is making the decision not to renew its licensing deal with Amazon Prime past 2018, meaning its older series will be removed from the service.
According to Variety, HBO CEO Richard Plepler said that HBO Now sales are gaining momentum through DirecTV Now, AT&T’s virtual MVPD service that launched late last year. Interestingly, HBO won’t be available as an add-on for Hulu’s recently launched live TV service, although Hulu was able to secure rights to carry Turner networks.
Earlier this year, Time Warner CEO Jeff Bewkes revealed that HBO Now had amassed more than 2 million subscribers.