CBS posted third-quarter revenues of $3.26 billion, up 3% year over year, thanks largely to 79% growth from subscription streaming services All Access and Showtime.
CBS said it’s still on pace to set its revised goal of 8 million combined subscribers for All Access and Showtime by 2019. The company said that All Access is off to a good start in Canada and that it is preparing to launch the service in Australia.
The company also gave credit for the revenue boost to gains in retransmission revenues and fees at CBS Television Network affiliated stations. Advertising revenues rose 14% thanks in part to the inclusion of Network 10 in Australia.
Despite the growth in revenues—including a boost for content licensing and distribution—CBS posted operating income of $690 million, down 5% year over year. The company attributed the decline to “corporate matters,” which could include costs related to legal disputes with majority shareholder National Amusements and the departure of former CEO Les Moonves.
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CBS entertainment segment revenues jumped 19% to $2.15 billion as advertising revenues grew 16% and affiliate and subscription revenues rose 32%. Operating income for the segment rose 8% to $377 million.
Meanwhile, the company’s cable networks segment saw a precipitous 32% drop in revenues thanks to tougher comparisons with the year-ago quarter when Showtime distributed the Floyd Mayweather/Conor McGregor pay-per-view boxing event.
Overall, new CEO Joe Ianniello got a fairly upbeat first quarter as chief and he projected continued momentum in 2019.
“Up ahead, 2019 looks to be another outstanding year, with the Super Bowl and Final Four back on CBS, strong gains in retrans and reverse comp, and continued growth in our direct-to-consumer streaming services, which are on track to reach a combined eight million subs, a year ahead of our original projections. Overall, we are confident that our strategy of growing CBS’ leadership position as a global multi-platform premium content company will lead to even greater creative and financial heights in the years to come,” said Ianniello in a statement (PDF).