Viacom's Q Revenue Misses Estimates On Weak Ad Sales

Viacom Inc, the owner of MTV, Comedy Central, Nickelodeon and movie studio Paramount, reported a steeper-than-expected drop in quarterly revenue, hurt by lower advertising sales in the United States and few hit movie releases in the period.

Domestic advertising revenue fell 4 percent, as price increases were more than offset by a decline in traditional ratings at some of Viacom's networks. Three analysts told Reuters they had forecast domestic ad revenue to fall 5 percent in the quarter ended Dec. 31. Still, the drop was an improvement from the September quarter's 7 percent fall.

Viacom has struggled with lower ratings for its cable networks in recent years as younger viewers migrate to online and mobile video.

Philippe Dauman

The company's board last week named Chief Executive Philippe Dauman as executive chairman, replacing 92-year-old majority owner Sumner Redstone and piling pressure on Dauman to improve Viacom's performance.

Last week, Mario Gabelli, the second-largest owner of voting shares in Viacom after the Redstone family, said that Dauman has six to nine months to turn the company around.

The company on Tuesday announced a deal with video messaging app provider Snapchat that gave Viacom exclusive rights to sell advertising around Snapchat's content.

Revenue in Viacom's filmed entertainment division, which includes Paramount, fell 15 percent to $612 million, hurt by fewer big film releases. The year-earlier quarter included the strong performance of "Teenage Mutant Ninja Turtles".

Net income attributable to Viacom fell to $449 million, or $1.13 per share, in the fiscal first quarter from $500 million, or $1.20 per share, a year earlier.

Total revenue declined 5.7 percent to $3.15 billion.