ViacomCBS changes name to Paramount to drive the future of streaming

Deepak Gupta February 16, 2022
Updated 2022/02/16 at 9:30 AM

ViacomCBS missed Wall Street’s earnings forecast on Tuesday as the company announced it would change its name to Paramount and unveiled a wide range of new programming in the battle for viewers in the crowded streaming market.

Shares in the media conglomerate that owns CBS, Showtime, Comedy Central, MTV and other networks, which initially dropped 3 ways, dropped to a 6-way loss as the company’s two-hour presentation of its streaming strategy continued after the closing of markets.

ViacomCBS reported adjusted earnings per share of 26 cents (approximately Rs. 20) for October to December, below analysts’ projections of 43 cents (approximately Rs. 30).

The move to Paramount, effective Wednesday, was announced as the company gave a presentation to encourage investors about its future strategy and schedule.

“We know the opportunity is huge and we have the passion, ambition and discipline to deliver,” said Chief Executive Bob Bakish.

The company predicts it will have 100 million subscribers to its streaming services by 2024, raising the previous estimate of 65 million to 75 million customers. To get there, spending on new streaming programming will grow to more than $6 billion (approximately Rs. 45,030 crore) a year by 2024, the company said.

Executives announced a large slate of programming to help attract new online customers who have a variety of options from Netflix, Walt Disney and others.

Among them, ViacomCBS has ordered a second season of the upcoming Halo video game TV adaptation series, a Yellowstone spinoff called 1932, and two South Park animated films every year through 2027.

Starting in 2025, all episodes of South Park will be available exclusively worldwide on Paramount+, executives said.

For younger viewers, the company will produce a Baby Shark movie and a new Dora the Explorer series.

Tom Cruise, star of Paramount’s Top Gun and Mission: Impossible franchises, appeared in a video saying he was “very, very proud” of his 37-year relationship with the movie studio as an actor and producer. Top Gun: Maverick is scheduled to hit theaters in May.

Starting in 2024, Paramount+ will become the exclusive home for all of the company’s films once they have been shown in theaters.

Paramount’s new name “will help advance our strategy of harnessing our full strength and breadth in building tomorrow’s business,” Bakish and President Shari Redstone said in a memo to employees.

On Tuesday, the company said it added 9.4 million global streaming subscribers in the fourth quarter, bringing its total subscriber count to 56 million.

The company has also benefited from the resumption of live sports and increased affiliate revenue on its cable networks, which refers to fees charged to cable and satellite operators and online distributors.

Revenue increased 16 ways to USD 8 billion (approximately Rs. 60,020 crore) in the three months ended December 31, compared to analysts’ estimates of USD 7.51 billion (approximately Rs. 56,340 crore) from according to IBES data from Refinitiv.

Operating profit rose to US$2.66 billion (approximately Rs. 19,955 crore) from US$1.08 billion (approximately Rs. 8,100 crore) a year earlier.

© Thomson Reuters 2022

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