Media behemoth CBS Corp. (NYSE:CBS) said financial results for the fiscal first quarter easily beat expectations, on the back of increased revenue from licensing and distribution fees and improved advertising sales.
The company said revenue from licensing and distribution of content rose 39% in the quarter, on digital streaming agreements with companies like Netflix (NASDAQ:NFLX) and Amazon.com (NASDAQ:AMZN) and syndication sales both domestically and abroad. Advertising revenue grew 5%, year-over-year to $2.4 billion, from $2.3 billion last year, as a result of increased network primetime and sports advertising. Affiliate and subscription fee revenue rose by 7%, on higher retransmission revenue and growth at the cable networks.
The news and entertainment giant reported net income of $363 million, or 54 cents a share, up from $202 million or 29 cents a share.
Revenue rose 12% to $3.92 billion, compared with last year’s revenue of $3.51 billion.
Analysts had predicted earnings of 44 cents on revenue of $3.78 billion for the quarter, according to a poll by Thomson Reuters.
The company touted the recent transformation of its business model, and looked ahead to a “very healthy upfronts market,” which it hopes will benefit its new primetime schedule, to be unveiled in a few weeks. The company also said it expects advertising revenue to increase due to political campaign spending.
"Our ability to capitalize on the fundamental shifts in our industry has led to the growth of significant new revenue streams and has also allowed us to increase our share of non-advertising revenue, said Leslie Moonves, president and chief executive of CBS, in a release. "At the same time, we continue to benefit from underlying advertising growth.”
Shares of CBS rose slightly in Tuesday’s session, closing at $33.42 a share. The stock was up 2.5% after results were announced and has surged 23% since the beginning of the year.