Discovery Communications Reports Q1 Earnings Below Expectations As Subscribers Cut The Cord

Discovery Communications Inc. reported earnings for the first quarter before the market opened on Tuesday that fell shy of Wall Street expectations. The media company reported net income of $215 million, or 37 cents, for the quarter, down from $263 million, or 42 cents during the year-earlier period. Adjusted per-share earnings came in at 41 cents, below FactSet's consensus of 50 cents. Discovery said total revenue hit $1.61 billion during the quarter, an improvement compared with $1.56 billion in revenue, but just below FactSet's $1.63 billion revenue consensus. The media sector has been hit recently by softer advertising revenues and renewed fears of cord-cutting across the board. Discovery's advertising revenue was flat year-over-year. The company said advertising revenue at its U.S. networks rose 1% due primarily to higher pricing. And while distribution revenue at Discovery's U.S. networks grew 5%, it was partly offset by a decline in subscribers. Shares of Discovery were inactive in premarket trade, but have declined less than 1% in the year to date and more than 3% in the prior 12-month period. By comparison, the S&P 500 index has gained more than 7% in the year and almost 17% in the last 12 months.