CBS beats expectations for revenue, profit in third quarter
CBS (CBS) reported third-quarter results that exceeded Wall Street’s expectations after a flurry of recent personnel changes shook up the company’s executive roster.
The media company beat on the top and bottom lines in the third quarter, the first with acting CEO Joseph Ianniello at the helm. Ianniello, previously chief operating officer at CBS, took over as top executive after Leslie Moonves departed in September following multiple allegations of sexual misconduct.
CBS’s third-quarter adjusted earnings came in at $1.24 per share on revenue of $3.26 billion, slightly exceeding consensus estimates of $1.22 per share on revenue of $3.24 billion, according to data compiled by Bloomberg.
“CBS continues to deliver for our shareholders and execute our long-term growth strategy,” Ianniello said in a statement. “We turned in our best third quarter ever in revenue and EPS, and we remain on track to achieve our 2018 outlook, with revenue growth in the high-single digits and EPS growth in the high teens.”
Political advertising ahead of the midterm elections helped drive a 14% increase in ad revenue in the third quarter. Content licensing distribution revenues rose 8% in the period.
Shares of CBS were little changed as of 4:26 p.m. ET. The company’s stock is little changed for the year-to-date and is up about 5% percent since Moonves’s announced departure on September 9.
In addition to tapping Ianniello as acting CEO in September, CBS announced it promoted two executives from its cable network Showtime to the C-suite in October, after the end of the third-quarter. Christina Spade became CFO, while David Nevins came on as chief creative officer in a move to help assuage concerns over Ianniello’s lack of programming background.
In the third quarter, CBS also ended a months-long legal battle with majority shareholder National Amusement Inc. over control of the company. Moonves had been leading the charge to dilute the Redstone family holding company’s controlling stake in CBS, but the case was settled in September before litigation began. Six CBS board members who voted to dilute the Redstones’ control stepped down and were replaced following the end of the corporate feud.
With the dust around the board room beginning to settle, investors could turn attention to CBS’s operations and finances, which have continued to be solid.
“So far, we are impressed with CBS’s ability to hit its numbers given the executive shake-up and ongoing drama at the CEO and Board levels,” Laura Martin, an analyst with Needham & Company, wrote in a note ahead of results. “We will be paying careful attention for signs that the corporate disruption begins to negatively impact CBS’s financial metrics and/or employee turnover (which is often a precursor to deteriorating financial results).”
—
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
Read more from Emily:
Netflix user growth beats expectations, shares spike
Now is a ‘once-in-a-lifetime chance’ to invest in US pot companies, investor says
There are ‘4 headwinds’ facing markets rights now