AMC Networks, the company behind the AMC, IFC and Sundance Channel networks, as well as niche streaming services like horror-centric Shudder, said Friday that its U.S. advertising revenue jumped 22 percent during the third quarter and that it has seen continued streaming subscriber growth.
Its third-quarter financials exceeded Wall Street estimates, with management increasing its full-year 2021 forecast for revenue and adjusted operating income.
It was the company’s first earnings report since it named former Showtime Networks chief Matthew Blank its interim CEO, taking over from company veteran Josh Sapan, in late August. In late September, AMC Networks also said that COO Ed Carroll would leave his post at the end of the year, ending a 34-year tenure with the company.
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“In anticipation of having a strong finish to the year, we are increasing our full-year financial guidance for total company revenue and adjusted operating income,” Blank said Friday. “We continue to see subscriber acquisition momentum and high engagement across our targeted streaming portfolio of AMC+, Acorn TV, Shudder, Sundance Now and ALLBLK, and are on track to deliver our year-end streaming target to achieve 9 million paid subscribers.”
He added: “We are building a streaming business that is sustainable and will be profitable over the long term, and with our owned IP, our library of high-quality content, and our strong legacy channels business, we have the right assets to drive growth and increase shareholder value.”
AMC Networks’ domestic advertising revenue increased to $200 million “due to higher pricing and ad-supported streaming growth, and an increase in the number of episodes of our original programming, partially offset by lower linear ratings.” Among the original series in the latest period were episodes of season 11 of AMC hit show The Walking Dead.
Sapan, now serving as the company’s executive vice chairman, had on the second-quarter earnings conference call touted one of the firm’s strongest upfront advertising seasons ever, saying that it was a sign of the appeal of its content and brands.
Third-quarter U.S. distribution and other revenue rose 26 percent to $483 million, with content licensing revenue up 60 percent, “driven by a higher number of distributed original programs as compared to the prior comparable period as a result of earlier COVID-19 pandemic production delays.”
Including a 17 percent gain in international revenue, total company revenue increased 24 percent in the third quarter to $810.8 million. Quarterly operating income jumped 35 percent to $188.3 million, with the adjusted figure up 21 percent to $224.7 million. Net income rose from $61.6 million to $110.7 million.
A recent settlement around The Walking Dead participations included a revision of free cash flow guidance by AMC Networks from around $200 million this year to breakeven due to a cash settlement. The long-running legal battle over Frank Darabont’s profits from the hit show came to an end in July, with the company agreeing to a nine-figure payout to the former showrunner and his agency, CAA. The settlement resolved all litigation.
AMC Networks’ earnings report Friday also noted some content successes. It mentioned that the premiere of season 11 of The Walking Dead was “a top driver of subscriber acquisition and viewership on AMC+.”
It also noted that its team has greenlit “new AMC+ and AMC series Interview With the Vampire, Tales of the Walking Dead, Dark Winds and Moonhaven” and opened writers rooms for the development of potential new original series, including Anne Rice’s Lives of the Mayfair Witches, Demascus and Invitation to a Bonfire.
