Viacom, CBS Report Bullish Earnings

Viacom Inc. posted revenue growth thanks to its first uptick in domestic advertising in 20 quarters, a sign that the media giant’s performance is improving after a prolonged slump.

According to The Wall Street Journal, Viacom, the parent of Comedy Central and Nickelodeon, said third-quarter revenue edged up 3.7% to $3.36 billion from a year earlier. Excluding the impact of foreign exchange, revenue rose 6%. Analysts polled by FactSet were expecting revenue of $3.32 billion.

Bob Bakish

The results are a sign that Viacom’s performance has improved since Bob Bakish took over as chief executive at the end of 2016--an indication that Viacom is on stronger footing to negotiate a merger with sister company CBS Corp. than when the two sides held talks last year.

Viacom and CBS are in advanced talks to merge and recently reached a working agreement on the management team for the combined company. A deal could be announced before the end of the month, according to people familiar with the matter.

The company said it wouldn’t be responding to questions about mergers and acquisitions at the beginning of the call, and executives didn’t discuss CBS in their remarks.

On an earnings conference call Thursday, Mr. Bakish said the advertising growth “represents a significant milestone,” noting that Viacom’s sales effort was bolstered by partnerships with pay-TV companies.

Meanwhile, CBS Corp.’s investment in content and streaming-services expansion helped deliver better-than-expected revenue growth in its second quarter.

The WSJ reports New York-based CBS reported revenue for the quarter rose 9.9% from a year earlier to $3.81 billion. Analysts polled by FactSet expected $3.72 billion.

The company said quarterly profit rose 10% to $440 million, or $1.17 a share. On an adjusted basis, the company reported a profit of $1.16 a share. Analysts surveyed by FactSet anticipated $1.12 a share for both profit and adjusted profit.

The company said subscriptions from direct-to-consumer streaming services—anchored by CBS All Access and Showtime—helped drive a 13% increase in affiliate and subscription revenue in the quarter.

Without disclosing actual subscription figures for those services, CBS said it remains on track to reach its goal of 25 million combined subscribers by the end of 2022. The 25 million target doesn’t include subscriptions from international services, company officials had said.