Reuters

(Reuters)

CBS Earnings Fall But Top Views

Earnings Dow Jones Newswires

CBS Corp. said its first-quarter earnings fell 19% on lower revenue that was hurt by the airing of fewer National Football League playoff games and a decline in advertising revenues at its local broadcasting business.

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Shares still rose 1% to $61.85 in recent after-hours trading as results beat expectations.

Like other media companies, CBS has been aiming to reduce its reliance on advertising revenue to reflect shifts in how people consume television shows and movies. Investors likely will be watching for any details about CBS's plans for an Internet-delivered version of premium channel Showtime, which will be similar to Time Warner Inc.'s effort to appeal to a growing audience of cord-cutters with its online-only version of HBO.

Separately, Executive Chairman Sumner Redstone earlier on Thursday denied media reports that any decisions had been made about who would succeed him as chairman of CBS and Viacom Inc. Mr. Redstone said any such decision would be made by the companies' boards, and not by any individuals.

He added that after his death, his stakes in the companies will be overseen by a group of seven trustees. "Until that time, I will continue to make all such decisions," he stated.

The New York Post on Wednesday reported that Mr. Redstone's daughter, Shari Redstone, is in-line to succeed her father at CBS and Viacom, and that her views likely will be supported by a majority of the trust's directors, citing people close to the situation.

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Mr. Redstone is 91 years old and has made plans for how his roughly 80% voting stakes in both companies will be managed after his death. Those interests will pass to Mr. Redstone's grandchildren and their descendants, and will be managed by a seven-member trust.

The trust will be comprised of three family members and four nonfamily members and will include Mr. Redstone's daughter; her son Tyler Korff; Viacom CEO Philippe Dauman; David Andelman, a CBS board member; and George Abrams, a longtime Redstone family attorney.

It is widely expected that CBS CEO Leslie Moonves and Mr. Dauman would become chairmen of their respective companies after Mr. Redstone dies, because their contracts stipulated that they won't report to anyone other than Mr. Redstone.

Mr. Redstone wasn't on CBS's earnings call Thursday.

In the latest quarter, CBS reported that its advertising revenue fell 4.8% to $1.78 billion. Content licensing and distribution revenues decreased 4.2% to $1.03 billion, while affiliate and subscription fees increased 11% to $628 million, driven by growth in rates.

In the latest quarter, CBS's entertainment division--which includes the television network, CBS Television studios and CBS films--reported revenue fell 1.8% to $2.26 billion, from a year earlier when CBS aired an additional NFL playoff game. Segment operating earnings decreased 18%, reflecting a higher investment in sports and entertainment programming.

The cable networks unit--which includes Showtime, CBS Sports Network and Smithsonian Networks--reported revenue edged up 0.4% to $539 million and operating earnings dropped 1.2%.

The company touted the strength of its prime-time TV lineup as the end of the 2014-2015 television draws closer.

"We are set to close the season with four of the top five new scripted series, all of which we have ownership in and can monetize in a growing number of ways," Chief Executive Leslie Moonves said in a news release Thursday. "We will also win the season as the most-watched network in America, with a solid performance across all demographics at a time when others are facing ratings erosion.

"Looking ahead, we will continue to build upon our position of great strength with a new prime-time lineup that we will announce next week, and we expect to be No. 1 in the upfront marketplace," he stated.

Overall, CBS reported a profit of $394 million, down from $468 million a year earlier. Per-share earnings were flat at 78 cents on a decrease in shares outstanding. Revenue decreased 2% to $3.5 billion.

Analysts polled by Thomson Reuters expected per-share profit of 75 cents and revenue of $3.45 billion.

Keach Hagey contributed to this article.

Write to Tess Stynes at tess.stynes@wsj.com

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