As the company is on the verge of potentially agreeing to a merger, Paramount Global is moving on from chief executive officer Bob Bakish. Various reports have indicated that Bakish has lost the trust of Paramount Global controlling shareholder Shari Redstone, who owns National Amusements and is looking to sell her stake in the company. The company has established an Office of the CEO that will include George Cheeks, president and chief executive officer of CBS; Chris McCarthy, president and chief executive officer of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, president and chief executive officer of Paramount Pictures and Nickelodeon.
Skydance Media has reportedly made Paramount its last and final offer for a merger that would include a $3 billion cash injection to pay down debt and re-purchase stock. Additionally, Skydance has reportedly offered a premium for a percentage of non-voting shareholder Class B shares, which could presumably help the company following its debt being downgraded to BB+ status by S&P Global last month. Earlier in April, The Wall Street Journal reported that four members of the Paramount board of directors stepped down from their roles.
The company has been trying to diminish its linear television losses and adapt to the changing media environment predicated on innovations in the digital and streaming spaces. Just after attaining record average viewership of 123.7 million viewers for its broadcast of Super Bowl LVIII, the company laid off 3% of its workforce with the intent to “grow revenue, while reducing costs.” During the company’s Q1 earnings call, Paramount executive vice president and chief financial officer Naveen Chopra stated that “sports continued to overdeliver,” which included the NFL Playoffs (average of 45.6 million viewers), Super Bowl LVIII and NCAA Division I Men’s Basketball Tournament.
In the fiscal first quarter, the company attained $7.7 billion in revenue, which is up 6% from Q1 2023. Television advertising revenue had a 23-percentage point benefit from the Super Bowl that led to a 14% overall increase in the category. Continued subscriber declines in television media resulted in a 3% drop in affiliate and subscription revenue. Adjusted OIBDA in the quarter equated to $1.4 billion, an 11% increase that was partially driven from the Super Bowl LVIII broadcast.
“The game broke records across CBS, Paramount+ and Nickelodeon, a great example of the power of our multiplatform offering,” Naveen Chopra, Paramount executive vice president and chief financial officer, said on the company’s earnings call.
During last year’s fiscal fourth quarter, Paramount garnered $7.6 billion in revenue and $404 million in operating income, the latter of which was up 122% year-over-year. Additionally, Paramount+ revenue grew by 69% through the net addition of 4.1 subscribers in the quarter. The platform added 3.7 million subscribers in Q1 2024, coming to a total of 71.2 subscribers worldwide. Average revenue per user (ARPU) also expanded by 31% year-over-year as advertising revenue rose by 14% on the year as well.
As CBS Sports serves as one driver of Paramount+ subscriptions through live game broadcasts and other sports content, the sports division recently endured a change of its own with the retirement of chairman Sean McManus and advertising chief John Bogusz stepping down from his role. Earlier on Monday, the company announced that former NFL quarterbacks and longtime analysts for The NFL Today, Phil Simms and Boomer Esiason, would not be returning to the studio show. Former NFL quarterback Matt Ryan will be joining the studio show next season, along with host James Brown and analysts Bill Cowher, Nate Burleson and J.J. Watt.
