Paramount Global’s streaming division posted a second straight quarter of profit, boosted in part by net customer additions to its direct-to-consumer streaming service Paramount Plus during the company’s third financial quarter (Q3) of the year.
On Friday, Paramount revealed its Paramount Plus business added 4 million global subscribers during the three-month period that ended September 30, bringing the total customer count to just over 72 million. It reversed a decline in subscribers that was logged during the prior quarter, when Paramount said its customer base dipped to 68 million, a loss of 2 million subscribers.
High-interest programming helped drive net customer additions during Q3, including the start of the National Football League’s (NFL) regular season — Paramount’s broadcast network, CBS, shares Sunday afternoon telecast rights to football games with Fox, and offers its games through Paramount Plus — and UEFA soccer. The second season of “Tulsa King” starring Sylvester Stallone, and a quasi-reboot of the crime procedural “Matlock” starring Kathy Bates, also helped Paramount attract subscribers in the U.S. and other territories.
Streaming revenue grew to $1.86 billion, an increase of 10 percent, spurred by subscriber growth at Paramount Plus and a high amount of interest in connected TV advertising against Paramount Plus and the free, ad-supported platform Pluto TV. Advertising revenue from Paramount’s streaming properties jumped 18 percent to $507 million, while subscription revenue clocked in at $1.3 billion, or 7 percent higher.
Adjusted for various expenses, Paramount’s operating income from streaming clocked in at $49 million for the quarter, marking the second consecutive quarter of streaming profit. During Q3 2023, Paramount reported a loss of $238 million attributed to its streaming business.
The success of Paramount’s streaming products did not come without some pain — throughout the year, the company has laid off hundreds of workers in marketing, production and legal who were directly connected with Paramount Plus and Pluto TV, something one executive noted in a statement on Friday.
“During an extremely difficult period where we were forced to say goodbye to many talented colleagues and friends, I applaud our tenacious Paramount Streaming team on another excellent and profitable quarter.” Tom Ryan, the CEO of Paramount’s streaming business, wrote in a social media post. “Even in the hardest of times, this team perseveres and delivers.”
While Paramount’s streaming business is accelerating, its traditional television business continues to rake in more money — though that segment also posted year-over declines across most of its line items.
Revenue attributed to Paramount’s broadcast and cable networks was $4.3 billion during the quarter, or 6 percent lower compared to Q3 2023. Advertising revenue slipped 2 percent to $1.67 billion, while distribution fees from cable and satellite companies dropped 7 percent to $1.87 billion.
Paramount attributed the declines to lower core advertising interest compared to 2023, as well as ongoing pressures in the cable and satellite industry, where customers are defecting for cheaper streaming options (like Paramount Plus).
While the bulk of Paramount’s broadcast and cable TV income is from its domestic networks — Paramount owns CBS, MTV, VH1, Comedy Central, Showtime, Nickelodeon and a handful of others — the company’s overseas networks business was also depressed during Q3. In the United Kingdom, Paramount owns Channel 5, while in Australia, it operates Network 10. The company also operates pay TV networks throughout Europe that are branded similarly to its American TV channels.
On the film and TV studio side, Paramount’s income dipped 34 percent to $590 million, weighed down in large part by a decline in advertising and theatrical revenue. Paramount said the “number and timing” of various films impacted both line items, relative to Q3 2023. Paramount said the company’s film division continues to be affected by twin Hollywood strikes that ground production to a halt last year.
Overall, Paramount’s revenue came in at $6.73 billion, or 6 percent lower compared to Q3 2023. The company said it was able to save $500 million in expenses by streamlining certain parts of its business, which involved unit consolidations and mass layoffs.
