NEW YORK (Reuters) - Time Warner Inc. posted better than expected quarterly results, helped by a recovery in TV advertising, but the titles fell, the media company did not increase its income in the year of the forecast.
Time Warner, which has a clutch of cable networks, premium HBO, magazines and a TV service film studio, is the latest media company to benefit from the strength of the advertising market.
The main criticism of Time Warner was that its results, while for forecasts, seem a little pedestrian compared with areas of blowing of CBS and Viacom. News Corp, which owns Fox Broadcasting with a film studio, pay-TV companies and newspapers, is due to report earnings later Wednesday.
If not, it is that they exceeded the estimates as much as all other societies have in space, said Laura Martin, an analyst with Needham Capital."
There were also some disappointment that Time Warner chooses not to raise its Outlook of the year for gains, helping the reader shares down 3% after its earnings report. The company said growth in income of the year would improve in the second quarter, but most large gains will have to wait for the third and fourth quarters.
SITE ROTTEN
The earnings announcement came the same day where Time Warner said that he had purchased the discovery service the Flixster movie, which also holds that the "Rotten Tomatoes" see on the site. Speaking to analysts on a conference call, Time Warner CEO Jeff Bewkes said that he wanted to expand the service. The terms of the agreement were not disclosed.
"We plan to extend the functionality to allow the consumer to organize and to have access to their collections of digital film on any device they like and also buy and rent movies," he said.
For the first quarter, Time Warner reported a net income of $ 651 million. Compared with net income in the quarter of the previous year of $ 725 million. First quarter adjusted earnings of 58 cents that a share came in 2 cents above consensus analyst expectations.
The decline in profits was largely due to higher programming costs, specifically those related to its agreement with CBS to share coverage of the NCAA basketball tournament, which carries rights costly fees. Executives, said that the structure of the deal would put less pressure on profit margins in the coming years.
But the dark side of the transaction is contributed to driving a big jump in sale to Time Warner Cable advertising networks at a time where companies appear willing to spend more on national campaignsparticularly when it comes to the so-called event programming.
Advertising sales in all of its networks, which include TNT, TBS and CNN, has increased by 48%.
"I like advertising figures," said Martin of Needham. "It was an excellent number - really, that they did a good job."
Throughout the company media income increased 6% to $ 6.7 billion, said.
In its division of film, income has fallen to 3 per cent and earnings dropped by 50 percent, as of releases, including "Hall Pass", is a not draw as general public: "sherlock Holmes" or "the blind side" made last year.
In the Edition, time, Fortune and Sports Illustrated, revenue was essentially stable at $ 798 million.
Shares of Time Warner, 17 per cent this year, were down $1.07 or 2.83% at $36.66 Wednesday afternoon.
(Other reports by Jennifer Saba.) (Editing by Derek Caney and Matthew Lewis)
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