Time Warner Second-Quarter Profit Declines
UPDATED: The entertainment conglomerate, led by CEO Jeffrey Bewkes, posted a four percent revenue decline.
Time Warner on Wednesday reported lower second-quarter earnings, but reiterated its full-year financial forecast.
The entertainment conglomerate, led by CEO Jeffrey Bewkes, posted a profit of $429 million, compared with $637 million in the year-ago period. Adjusted operating profit declined 5 percent to $1.2 billion. Revenue declined 4 percent to $6.7 billion.
Financial improvements in the TV networks unit were not enough to offset declines in the film and TV entertainment and publishing divisions.
Operating income in the latest period included $147 million in charges related to the shutdown of Turner’s general entertainment network, Imagine, in India and TNT's operations in Turkey.
TV networks unit revenue rose 4 percent, as advertising improved 2 percent, with adjusted operating profit up 9 percent as higher programming expenses only partly counterbalanced higher revenue.
Film and TV entertainment revenue decreased 8 percent and adjusted operating profit fell 16 percent due mainly to difficult comparisons to the year-ago period, which included the theatrical release of The Hangover Part II and the home entertainment release of Harry Potter and the Deathly Hallows: Part 1. But TV licensing revenue rose thanks to the initial cable availability of The Mentalist.
“Across Time Warner, we’re continuing to make progress on our long-term goals, and we remain on track to meet our financial objectives for the year," said Bewkes. "This quarter, our results highlight the strength and potential of our networks and television production businesses, which generate the bulk of our revenues and earnings. We saw terrific performance at most of the Turner networks."
He highlighted that TNT was the top network on ad-supported cable, "bolstered by another great NBA season and the introduction of original hits like Dallas." TBS was up 30 percent in primetime in its key demographic in the quarter thanks in part to the success of The Big Bang Theory.