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CBS profit beats analysts' estimates as affiliate fees increase
[LOS ANGELES] CBS Corp, owner of the most-watched US TV network for more than six years, reported a better-than-expected quarterly profit on Thursday as revenue from affiliates and subscription fees rose.
But total revenue fell about 2 per cent as the company telecast one less NFL playoff game in the first quarter, compared with a year earlier.
CBS, whose network is home to naval intelligence drama"NCIS" and comedy "The Big Bang Theory", said revenue from affiliates and subscription fees rose 10.8 per cent in the three months ended March 31.
The company has been focusing more on non-advertising revenue, such as subscription and retransmission fees, to help offset fluctuations in advertising revenue, which can vary from quarter to quarter depending on events.
Advertising revenue accounted for about 51 per cent of total revenue in the quarter.
The contribution of non-advertising income to CBS's total revenue rose from 43 per cent in 2009 to just under 50 per cent in 2014, according to research firm Trefis.
Apart from advertising, CBS gets income from charging affiliates for programming, service providers for its cable networks, and subscription fees for online content.
CBS, in addition to its TV broadcast network, owns cable channels Showtime and CBS Sports Network, radio stations and the Simon & Schuster publishing house. It also has an online subscription streaming service, CBS All Access. "I like what we're seeing in terms of the future of advertising at CBS," Chief Executive Les Moonves said on a conference call with analysts.
Underlying network advertising revenue rose 1 per cent. "There are some people who believe TV is dead or dying, it's actually fine," Pivotal Research Group analyst Brian Wieser said.
CBS's net income from continuing operations fell 14.7 per cent to US$394 million.
Earnings per share rose to 78 cents from 77 as the weighted average number of common shares outstanding fell. Analysts on average expected earnings of 75 cents per share.
Revenue of US$3.50 billion beat the average analyst forecast of US$3.44 billion, according to Thomson Reuters I/B/E/S.
CBS shares, which closed at US$61.22 on the New York Stock Exchange on Thursday, were up about 1 per cent in extended trading.