Key Takeaways
- Q1 adjusted EPS reached $0.23, surpassing Wall Street’s $0.15 projection; total revenue climbed 2% to $7.35 billion
- Paramount+ subscriber base expanded 2% to 79.6 million, falling marginally short of the 79.9 million analyst target
- TV Media segment plunged 19% to $3.67 billion, significantly underperforming the anticipated 9.5% contraction
- Q2 revenue forecast of $6.75ā$6.95 billion came in below the $7.07 billion analyst expectation
- The pending $81 billion Warner Bros. Discovery merger is still expected to finalize by Q3 2026
Paramount Skydance (PSKY) shares surged up to 4% during after-hours trading Monday following the company’s better-than-anticipated first-quarter earnings results. By Tuesday’s premarket session, shares had settled to a 1.5% gain at $11.30, though the stock has declined 17% year-to-date.
Paramount Skydance Corporation Class B Common Stock, PSKY
The media giant delivered adjusted earnings per share of $0.23, handily topping the analyst consensus of $0.15. Total revenue increased 2% year-over-year to $7.35 billion, exceeding Wall Street’s $7.28 billion projection.
This marked the first quarterly report since the company emerged victorious in February’s competitive acquisition process for Warner Bros. Discovery.
Streaming operations emerged as the performance highlight. Direct-to-consumer segment revenue jumped 11% to $2.4 billion. The Paramount+ platform specifically delivered 17% revenue growth, reaching $1.97 billion.
Subscription figures landed marginally below projections. Paramount+ concluded the quarter with 79.6 million subscribers, representing 2% annual growth but missing the 79.9 million forecast. Management attributed subscriber momentum to popular series including “Landman,” “The Madison,” and “Marshals.”
The studios division also delivered positive results, with revenue advancing 11% to $1.28 billion, driven by the theatrical success of “Scream 7.”
Legacy Television Business Pressures Intensify
Traditional broadcast and cable operations continue facing headwinds. TV Media revenue contracted 19% to $3.67 billion ā substantially worse than analysts’ anticipated 9.5% decline. Both advertising and affiliate revenue streams contributed to the deterioration.
This reflects the persistent structural headwinds confronting legacy media companies. Viewer migration toward streaming platforms continues accelerating, with advertising expenditures following suit.
Second Quarter Outlook Falls Short
For the second quarter, management projected revenue between $6.75 billion and $6.95 billion. The midpoint sits below the $7.07 billion consensus forecast.
Executives attributed the softer outlook to challenging year-over-year comparisons against robust theatrical performance in the prior-year period.
Adjusted EBITDA guidance for Q2 ranges from $900 million to $1 billion, exceeding analyst estimates of $861.8 million.
Management maintained full-year 2026 projections: $30 billion in revenue and $3.8 billion in adjusted EBITDA.
The company also indicated Paramount+ subscriber counts will remain “flattish” sequentially in Q2. Approximately 2 million international hard bundle subscriptions are being phased out as part of a portfolio optimization initiative.
The Warner Bros. Discovery transaction, carrying an $81 billion valuation, secured shareholder endorsement on April 23. Monday’s announcement confirmed management’s expectation to finalize the deal by the conclusion of Q3 2026, pending regulatory clearance.
CEO David Ellison emphasized in his shareholder communication that the merged entity intends to distribute 30 theatrical releases annually following transaction completion.
Paramount competes head-to-head with Netflix and Disney+ in the streaming arena, and the Warner acquisition would incorporate HBO Max into its streaming stable.
Regulatory authorities continue reviewing the proposed merger, with no additional updates regarding approval timeline disclosed in Monday’s announcement.
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