CBS Corp. (CBS) - Get Report posted stronger-than-expected third quarter earnings Tuesday, but saw ad sales fall sharply, in its final stand-alone report before its $30 billion December merger with Viacom Inc (VIAB) - Get Report .
CBS said adjusted earnings for the three months ending in September came in at 95 cents per share, down 23.4% from the same period last year but 3 cents ahead of the Street consensus forecast. Group revenues, CBS said, rose modestly from last year to $3.3 billion, just shy of analysts' estimates of a $3.58 billion tally.
"We delivered record third-quarter revenues as we continue to increase our investment in our premium content and direct-to-consumer streaming services, which is the cornerstone of our growth strategy," said acting CEO Joe Ianniello. "During the quarter, our direct-to-consumer revenue from CBS All Access and Showtime OTT grew 39% from last year, driven by a strong slate of original programming."
"Our content licensing revenue is also growing as we ramp up production of programming for all of our platforms, including five new hit shows that we just launched on the biggest platform in media, the CBS Television Network, which is on track to end the season as the most-watched network for the 12th consecutive year," he added.
CBS shares were marked 3% lower at the start of trading following the earnings release to change hands at $37.90 each, a move that would leave the stock with a year-to-date decline of around 13%.
Affiliate and subscription revenues rose 12%, CBS said, while content licensing and distribution revenues were up 1%. Ad revenues, however, fell 7% when compared to last year, which was boosted by sales into the 2018 mid-term elections.