MW Paramount skids to a loss but says merger expected to close in first half as expected

By Lukas I. Alpert

Paramount Global Inc. swung to a loss in the fourth quarter despite marked growth in its streaming service, as the company said it was still on target to close its merger with Skydance in the first half of this year.

The company (PARA) reported a net loss of $224 million, or 33 cents a share, for the quarter. That was down from a profit of $514 million, or 77 cents a share, in the year-earlier period. Analysts had predicted a gain of 13 cents per share, according to a consensus compiled by FactSet.

Revenue rose to $7.98 billion from $7.64 billion a year ago but came in below the $8.101 billion FactSet consensus.

Paramount shares fell 1.5% in after-hours trading.

Revenue from the company's direct-to-consumer segment, which houses its streaming business, rose 8% to $2.01 billion, while filmed-entertainment revenue shot up 67% to $1.08 million, driven largely by the releases of "Gladiator II" and "Sonic the Hedgehog 3."

TV-media revenue fell 4% to $4.98 billion.

The streaming service Paramount+ added 5.6 million subscribers in the period, bringing the total to 77.5 million. Revenue from the streaming business grew 16% and average revenue per user rose 1%.

Advertising revenue in the direct-to-consumer segment rose 9% to $574 million, while subscription revenue rose 7% to $1.44 billion.

The company's TV-media segment, which includes CBS, MTV, BET, Paramount International and Nickelodeon, saw ad revenue decline 4% to $2.2 billion, due to fewer sporting events and declines in the linear-TV ad market.

Meanwhile, the company said it still expects to close its merger with Skydance, the studio run by David Ellison, in the first half of 2025.

The deal has been complicated as Paramount has sought to settle a $20 billion lawsuit brought by President Donald Trump, which the company has worried could interfere with regulatory approval of the deal. Trump has accused "60 Minutes," the company's flagship news program, of deceptively editing an interview with Democratic candidate Kamala Harris during last year's presidential race.

As a first step toward the deal, Skydance will buy National Amusements, Shari Redstone's company, which controls Paramount. Then Skydance and Paramount will merge.

The deal has been a long and complicated one, with many other parties bidding and holding talks with Redstone and Paramount for more than a year.

Skydance is an independent production company run by Ellison, son of Oracle Corp. $(ORCL)$ founder Larry Ellison. Skydance has previously partnered with Paramount on a number of movies, including "Top Gun: Maverick" and "Mission: Impossible - Dead Reckoning."

-Lukas I. Alpert

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February 26, 2025 16:43 ET (21:43 GMT)

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