CBS Shares Rise After Reporting Record Revenue in First Quarter

Leslie Moonves - 2015 Venice Family Clinic's Silver Circle Gala - Getty - H 2018
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CEO Les Moonves said CBS All Access and Showtime OTT "are now contributing meaningful dollars to our bottom line."

CBS on Thursday reported record revenue of $3.8 billion for the first quarter, along with all-time quarterly highs in adjusted income.

The company said it earned $1.34 per share while it was expected to earn $1.19 per share on $3.63 billion in revenue.

At the top of a conference call with analysts, CBS executives said they would not comment on how discussions of a potential CBS-Viacom merger are proceeding.

CEO Les Moonves was very optimistic about the future financial performance of CBS even in the digital era, which has been so challenging for many media companies. He noted that the quarter's earnings per share are also a record and mark the 33rd consecutive quarter of growth in that metric.

"There is so much more to come," the exec told Wall Street analysts Thursday.

Shares of CBS, which traded north of $70 last year, were off 1 percent Thursday to $48.76, but after the closing bell they were climbing about 3 percent higher.

"We achieved these record results thanks to the many ways we are delivering our must-have content, including our direct-to-consumer services — CBS All Access and Showtime OTT — which continue to grow rapidly and are now contributing meaningful dollars to our bottom line while attracting younger viewers," Moonves said.

Of its four segments, CBS posted revenue gains in all but one, publishing, though all four revenue types managed gains, with advertising growing to $1.7 billion, compared with $1.6 billion a year earlier. 

Moonves also praised Stephen Colbert for dominating late-night television and recently having a larger one-night audience than that of Jimmy Kimmel and Jimmy Fallon combined.

The CEO predicted strong advertising to come for its local stations due to the upcoming elections because "both the House and Senate are up for grabs."

Moonves acknowledged the competition for talent is heating up, noting that Shonda Rhimes and others have signed big deals with Netflix, but said it is likely that Chuck Lorre, creator of The Big Bang Theory, Two and a Half Men and other hit shows, has made hundreds of millions on the back end of his CBS deals.

The exec also said that CBS basically offers children's programming because it is legally obligated to do so — "I think we have 10 to 15 kids watching" — but because Netflix is doing well in that demographic, he is rethinking his strategy.