Best Buy Q3 Entertainment Segment Revenue Declined 4.6%

Best Buy Nov. 22 reported domestic entertainment segment revenue of $490 million for the third quarter (ended Oct. 29). That was down 4.6% from revenue of $549 million in the previous-year period.

The segment, which includes products such as DVD/Blu-ray Disc movies, video game hardware and software, books, music CDs and computer software, saw a 4.1% increase in the prior-year period. That quarter’s revenue growth was actually down from surge of 2020 when consumers restricted by stay-at-home mandates due to the pandemic stocked up on home entertainment purchases.

Total domestic revenue decreased 10.8% to $9.80 billion, from $10.985 billion a year ago.

Revenue declines are not news to Best Buy, which has seen same-store declines all year and is projecting a same-store sales decline of approximately 10% in the current fourth quarter, which includes Black Friday, Cyber Monday and the rest of the winter holiday retail season.

From a merchandising perspective, the nation’s largest consumer electronics retail chain saw comparable sales declines across almost all categories, with the largest drivers being computing and home theater.

Notably, the declines included e-commerce with online revenue down 11.6% to $3.04 billion, with e-commerce accounting for 31% of total domestic revenue, versus 31.3% a year earlier.

“We have strategically and effectively managed our inventory flow based on a shopping pattern that we believe looks more similar to historical holiday periods, with customer shopping activity concentrated on Black Friday week, Cyber Monday and the two weeks leading up to Dec. 25,” CEO Corie Barry said in a statement.

AMC Theatres Ups Q3 Fiscal Revenue, Widens Loss

AMC Entertainment Holdings Nov. 8 reported a third-quarter (ended Sept. 30) net loss of $226.9 million, which was up slightly from a loss of $224.2 million during the prior-year period. Revenue increased 27% to $968.4 million, from $763.2 million a year ago. Through nine months of the fiscal year, revenue topped $2.9 billion, up 115% from revenue of $763.2 million a year earlier.

CEO Adam Aron attributed the muddled Q3 results to a “particularly soft” industry-wide box office in the quarter.

“But encouragingly, our overall per-patron metrics for both admissions
revenue and food and beverage spending remain well above pre-pandemic levels, growing a sizable 12.0% and 30.0%, respectively, compared to the third quarter of 2019,” Aron said in a statement.

The executive, like much of Hollywood, has high hopes for the fourth quarter theatrical releases of Disney/Marvel Studios’ Black Panther: Wakanda Forever, which has posted advanced ticket sales surpassing expectations, as well as Strange World and Avatar: The Way of Water, among other films.

Indeed, Black Panther advance ticket sales have reportedly topped $45 million.

As the exhibition business continues to struggle, Aron said the world’s largest chain would continue to explore incremental business opportunities, which include selling branded popcorn at retail and the recently announced Zoom Rooms at AMC, affording groups the ability to connect with other large groups across the country.

“We expect to make more business development announcements in the coming weeks and months, which along with an improving movie theater sector, positions AMC Entertainment to create value for all our stakeholders,” Aron said.

FuboTV Increases North American Subs 31% to 1.23 Million

Online sports-themed streaming platform FuboTV  Nov. 4 reported it ended the third quarter (ended Sept. 30) with more than 1.23 million North American subscribers, up 31% from 939,000 subs in the previous-year period. The service closed the quarter with $219.2 million in North American revenue, an increase of 40% year-over-year from $156.6 million, while ad revenue was $22.5 million, up 21% year-over year from $18.6 million.

The company said the quarter’s net loss increased 44% to $152.7 million from a net loss of $105.9 million in the prior-year period. The increase was due in part to a non-cash impairment charge of $35.5 million pertaining to management’s decision to close the Fubo Gaming business and cease operation of its owned-and-operated Fubo Sportsbook.

Outside North America, the company generated $5.8 million in revenue and 358,000 total paid subscribers. European streaming operations include Molotov, the French live TV streaming service acquired in December 2021.

“Fubo remains committed to profitably scaling a global live TV streaming platform differentiated by the breadth of premium content and interactivity,” CEO David Gandler and executive chairman Edgar Bronfman Jr. wrote in the shareholder letter.

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AMC Networks Ups Q3 SVOD Subs 44% to 11.1 Million

AMC Networks Nov. 4 reported it ended the third quarter (ended Sept. 30), with 11.1 million subscription streaming VOD subscribers. That’s an increase of 44% from 7.7 million subs in the prior-year period.

The media company’s streaming properties include AMC+, British-themed Acorn TV, horror-themed Shudder, Sundance Now, ALLBLK (formerly Urban Movie Channel) and the anime focused HiDive.

“Anne Rice’s Interview With the Vampire” premiered in October and is the biggest new series in AMC+ history. The SVOD service launched operations in Australia, New Zealand and Spain.

Net revenue decreased 16% from the prior year to $682 million, from $811 million, largely driven by the timing of content licensing revenue, lower affiliate and advertising revenue, and unfavorable foreign currency translation, partly offset by streaming revenue growth of 41%. Operating income in the quarter decreased 13% to $187 million, from $215 million a year ago.

“Our focus to transform to a consumer-focused multi-platform premium content company is taking hold with strong digital distribution growth,” CEO Christina Spade said in a statement. “Our ability to break through the competition with our content, as we further reconstitute our revenue mix, positions us well for long-term success and value creation.”

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Roku Q3 Fiscal Loss Snowballs as CFO Plans 2023 Departure

Roku Nov. 2 reported a third-quarter net loss of $122.1 million on revenue of $761.3 million, compared with a net income of $68.8 million on revenue of $679.9 million during the previous-year period.

Roku added 2.3 million incremental active accounts to end the quarter with 65.4 million, compared with 56.4 million active accounts in the prior-year period. Streaming hours topped 21.9 billion hours, an increase of 1.1 billion hours from the second quarter (ended June 30). Streaming hours on The Roku Channel grew more than 90% from the same time a year earlier.

Steve Louden

Meanwhile, sales of Roku streaming devices and other consumer electronics declined 7% to $91 million, from $97.4 million a year ago. Roku platform revenue increased 15% to $670 million, which was lower than projected due to soft advertising sales.

Indeed, the company said advertising spending on the platform grew more slowly than its initial 2022 forecast due to ongoing weakness in the overall TV ad market, and the ad scatter market in particular. However, Roku contends that the long-term opportunity in TV streaming remains intact.

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“We believe the strong growth in the scale and engagement of our platform, combined with the continued consumer shift to TV streaming, positions us well for when the ad market improves,” CEO Anthony Wood and CFO Steve Louden wrote in the shareholder letter.

Louden plans to leave Roku sometime in 2023 after helping recruit
and transition his role to a successor. Louden, who is based in Seattle, joined Roku in 2015 and led the company’s initial public offering
process in 2017.

The CFO had originally planned to leave in 2019 but decided to remain with the company. Throughout his tenure, Louden helped build a strong management team to support Roku’s expanding business objectives and operational complexity.

Regardless, the underwhelming fiscal results sent Roku shares tumbling down more than 18% in aftermarket trading.

Dish: Sling TV Added 214,000 Subs in Q3 to Top 2.4 Million

Dish Nov. 2 announced that its pioneering online TV platform Sling TV added 214,000 subscribers in the third quarter (ended Sept. 30). The additions brought the platform’s subscriber base past 2.4 million. The tally is down from more than 2.5 million subs in the previous-year period.

Dish launched Sling in 2015 as the first online TV platform aimed at curbing online pay-TV subscriber defections to subscription VOD services. The online TV market is now led by Hulu + Live TV, which ended the most-recent fiscal period with 4 million subscribers.

Meanwhile, Dish saw further erosion of its legacy satellite TV service, ending the quarter with 7.6 million subs, down from 8.4 million in Q3 2021. Dish’s total pay-TV footprint topped 10 million subs — down nearly 1 million (980,000) subs from 2021.

At the same time, Dish continues to spend more acquiring satellite TV subs. The company spent more than $1,000 in marketing costs acquiring a subscriber in the quarter, compared with $824 in the prior-year quarter.

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Paramount Q3 Theatrical, Retail, Licensing Movie Revenue Up 48% to $780 Million

Paramount Global Nov. 2 reported third-quarter (ended Sept. 30) revenue from the box office, home entertainment and licensing of movies was $780 million, up 48% from $528 million during the previous-year period. Adjusted pre-tax operating income increased to $41 million in the quarter, reflecting the strong performance of Top Gun: Maverick. The segment posted a loss of $24 million during the previous-year period.

The uptick was driven in part by Paramount Pictures’ sixth consecutive No. 1 box office debut release, horror movie Smile, and the retail release of Top Gun: Maverick, which became the best-selling digital sellthrough title in the U.S. in its first week of release.

Theatrical revenue increased 245% to $231 million, from $67 million during the previous-year period. Through nine months of the fiscal year, Paramount’s box office revenue has skyrocketed 457% to $1.13 billion, from $202 million during the same period in 2021.

Filmed entertainment’s “licensing and other” segment, which includes home entertainment, saw revenue increase 19% to $549 million, from $461 million during the prior-year period. Through nine months, segment revenue is down 8% to $1.63 billion, from $1.78 billion a year ago.

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Paramount Ups Q3 Global Streaming Subs 42% and Operating Loss 73%

Paramount Global Nov. 2 reported it ended the third-quarter (ended Sept. 30) with 66.5 million direct-to-consumer subscribers, which was up more than 42% from 46.7 million subscribers during the previous-year period. Paramount SVOD subs include Paramount+, Showtime Anytime, SkyShowtime, Noggin and BET+.

Paramount+ ended the quarter with 46 million subs, which was up more than 80% from 25.5 million subs in the previous-year period. Revenue increased 95% to $708 million, from $363 million a year ago.

Paramount Global CEO Bob Bakish

Paramount+ subscriber growth was driven by launches in international markets as well as the start of the NFL season, UEFA Champions League, and the launch of a Walmart+ partnership.

Both tallies include the impact of the rollout of SkyShowtime with Comcast in Nordics, which resulted in the “loss” of 1.9 million Paramount+ subs in the region, and the elimination of 3.9 million global DTC subscribers, including 1.2 million for Paramount+ in Russia following its invasion of neighboring Ukraine.

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Overall direct-to-consumer subscriber revenue grew 59% to $863 million, from $542 million during the previous-year period. When combined with advertising, total revenue grew 38% to $1.23 billion, from $890 million.

On the flipside, operating expenses increased 44% to more than $1.57 billion, from $1.08 billion a year earlier, resulting in an operating loss of $343 million, 73% higher than an operating loss of $198 million during the prior-year period.

Separately, Pluto TV, the ad-supported VOD and free ad-supported streaming TV service, saw monthly average users increase 32% to 72 million, from 54.4 million users a year ago.

Notably, Pluto advertising revenue declined more than 7% to $268 million, from $289 million.

“In the quarter, Paramount continued to execute on our differentiated strategy … our diverse portfolio of platforms … that continued to drive growth in subscriptions across our streaming platforms with Paramount+ adding 4.6 million subscribers,” Bob Bakish, CEO of Paramount Global, said in a statement.

Amazon Reports Increases in Q3 North America Sales, E-commerce; Offers Lower-Than-Expected Q4 Forecast

Amazon Oct. 27 reported third-quarter (ended Sept. 30) net revenue of $78.8 billion, which was up 20% from net revenue of $65.5 billion during the previous-year period. E-commerce sales increased 13% to $53.5 billion, from $50 billion a year ago.

Online sales include media products sold in physical (DVD/Blu-ray Disc) and digital formats, including books, games, videos and software.

Subscription revenue, which includes Prime (and Prime Video) memberships, audiobooks, e-books, digital music and other non-Amazon Web Services revenue, increased 9% to $8.9 billion, compared with $8.1 billion last year.

Home entertainment highlights in the quarter included the premiere of several new entertainment series, including “The Lord of the Rings: The Rings of Power,” which attracted more than 25 million global viewers on its first day, the biggest debut in Prime Video history, and closing in on 100 million viewers to date. The company also premiered three new original and three returning series, including Heidi Klum and Tim Gunn’s “Making the Cut”; “The Outlaws,” starring Christopher Walken and Stephen Merchant; and the thriller “The Peripheral,” starring Chloë Grace Moretz.

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Prime Video kicked off the inaugural season as the exclusive home of NFL “Thursday Night Football,” with more than 15 million viewers for its first game. Live sports also returned to Prime Video across Europe with new seasons of UEFA Champions League soccer in Germany and Italy, Ligue 1 soccer in France, and exclusive coverage of U.S. Open tennis in the United Kingdom.

Meanwhile, Amazon said it expects to generate from $140 billion to $148 billion in global revenue in the fourth quarter. That’s well below industry estimates of $155 billion. The conservative outlook sent Amazon shares tumbling almost 20% in after-market trading.

“There is obviously a lot happening in the macroeconomic environment, and we’ll balance our investments to be more streamlined without compromising our key long-term, strategic bets,” CEO Andy Jassy said in a statement.

Universal Ups Q3 Home Entertainment Revenue 30%

Universal Pictures Home Entertainment Oct. 27 reported third-quarter (ended Sept. 30) revenue of $356 million, which was up more than 30% from revenue of $273 million during the previous-year period. Through nine months of the fiscal year, sales of movies, TV and other content across multiple formats, including packaged media, totaled $964 million, which is up more than 20% from $800 million in 2021 when the market was still impacted by the pandemic.

Top-selling movies at retail in the quarter included Jurassic World Dominion, Sing 2, Halloween Kills and Downton Abbey: A New Era, among others.

Overall studios (including theatrical) revenue increased 31.4% to $3.2 billion, primarily reflecting higher theatrical and content licensing revenue. Theatrical revenue increased $366 million to $673 million, primarily due to the successful performance of recent releases Jurassic World Dominion and Minions: The Rise of Gru. Content licensing revenue increased 16.8%, primarily due to the timing of when content was made available by Universal’s television and film studios under licensing agreements, including additional sales of content as production levels returned to normal.

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Adjusted pre-tax earnings increased $358 million to $537 million reflecting higher revenue, which more than offset higher operating expenses. The increase in operating expenses was driven by higher programming and production expenses, reflecting higher amortization of film and television production costs in the current year period.

For the nine months, revenue from the studios segment increased 26.4% to $8.9 billion, primarily reflecting higher content licensing revenue and theatrical revenue. Adjusted pre-tax earnings decreased 6% to $783 million, reflecting higher operating expenses, which more than offset higher revenue. The increase in operating expenses was primarily driven by higher programming and production expenses.

“Robust demand from guests at our theme parks and from viewers of our iconic content fueled nearly 25% growth in adjusted pre-tax earnings,” Chairman/CEO Brian Roberts said in a statement.