Paramount Global Q4 2022 Earnings: Profit Drops Amid Ad Revenue Decline, Streaming Prices Rise

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Highlights from Paramount Global's Q4 2022 Report

• On February 16, 2023, Paramount Global (PARA) released its fourth quarter earnings report.
  
• The company reported earnings and revenue below analyst expectations, triggering a decline in its stock price.
• Paramount experienced a notable drop in advertising revenue but saw a surge in streaming subscribers, prompting a price adjustment for Paramount+.

Paramount Global's shares declined following the announcement of Q4 earnings that fell significantly short of forecasts, primarily due to a 6.6% decrease in TV advertising revenue. Concurrently, the company revealed plans to increase subscription fees for its Paramount+ streaming platform.

For the quarter, Paramount posted earnings of $0.08 per share, roughly one-third of analyst projections. Total revenue increased modestly by 1.7% to $8.13 billion, missing expected targets.

Advertising revenue from the TV Media segment dropped to $5.88 billion, impacted by reduced ad impressions and currency fluctuations, despite higher political ad spending. Streaming revenue surged 30.2% to $1.4 billion, with Paramount+ adding a record 9.9 million new subscribers, reaching a total of 56 million.

Paramount+ Subscription Price Increase

Paramount announced that starting in Q3 2023, when Paramount+ merges with Showtime, the ad-free premium tier including Showtime will rise from $9.99 to $11.99 per month. The basic ad-supported plan without Showtime will increase from $4.99 to $5.99 monthly.

CEO Bob Bakish expressed confidence in the company’s trajectory, stating, "We anticipate returning to earnings growth in 2024."

Following the earnings release, Paramount Global’s stock dropped 4% on February 16, 2023, and has lost approximately one-third of its market value over the past year.

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