Viacom Inc., as forecast, returned to domestic advertising growth during the third quarter of its fiscal 2019.
The programmer registered a 6% gain year over year in U.S. ad revenues to $976.0 million, ending a negative trend that had stretched to 20 quarters. President and CEO Bob Bakish highlighted on the company's Aug. 8 earnings call that Viacom's push toward advanced advertising is paying dividends with media buyers.
Bakish said the company's commitment to its advanced marketing solutions offering has lifted the business, which has benefited from the company's marketing partnerships with distributors, as well. Viacom also has expanded its digital capabilities through the strategic purchases of AwesomenessTV Inc. and Pluto TV.
"Our AMS offerings now engage customers across linear and digital video," he said.
AMS revenue improved 84% in the quarter. Bakish said AMS volume has nearly doubled in fiscal 2019, representing nearly 20% of domestic ad revenue, as the company continues to bring new and more advanced inventory online across the growing portfolio, especially from streamer Pluto TV.
Bakish further said the company registered pricing gains in the high-single- to double-digit range across its various cable networks during the upfronts, reflective of brand strength and demand for the AMS portfolio. Annual upfront presentations launch the ad-buying season for marketers interested in placing ads alongside new programming who commit ahead of the upcoming TV season.
"We went in with a carefully crafted strategy to take full advantage of both the market dynamics and our unique assets, which resulted in our ability to drive price increases and capture meaningful overall volume, while preserving significant linear inventory to continue to capitalize on an extremely strong scatter market," Bakish said.
Marketers purchase advertising inventory much closer to the content's air date in the scatter market.
Viacom's potential recombination with CBS Corp. was not addressed on the call.
Total revenues for the third fiscal 2019 quarter ended June 30 grew 3.7% to $3.36 billion from $3.24 billion in the prior-year period. Advertising revenue increased 3% to $1.23 billion, as the aforementioned 6% domestic amelioration to $976.0 million, was countered by a 7% decline to $250 million internationally.
Filmed entertainment revenues rose 14% to $877.0 million, with the business off 4% to $446.0 million in the U.S. and ahead 40% abroad to $431.0 million.
Net income attributable to Viacom reached $544.0 million, or $1.35 per share, in the third fiscal quarter, a 5% gain from $522.0 million, or $1.29 per share.
The S&P Global Market Intelligence EPS consensus estimate for the quarter was $1.07 on both GAAP and normalized basis.