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Viacom Q2 Revenues Up 24%

Aug 9, 2006  •  Post A Comment

Viacom reported Wednesday that its second-quarter revenues were up 24 percent to $2.85 billion and that operating income rose 14 percent to $663 .2 million despite a tough cable TV advertising market.

Net earnings were $473.3 million, up from $353.9 million for the corresponding quarter last year.

Viacom’s cable networks, including MTV, showed an 8 percent increase in revenue and a 12 percent increase in operating income.

“Despite a challenging cable advertising environment, we once again outperformed the market,” said Tom Freston, president and CEO of Viacom. Domestic advertising revenues were up 10 percent to $969.1 million, the company said.

Mr. Freston said the company was pretty much done with upfront television advertising sales. Percentage-wise, volume was up mid-single digits, with pricing on a cost-per-thousand viewer basis flat to slightly up. The company sold about half of its ad inventory in the upfront, similar to last year’s upfront sales results.

The company reported $51 million in digital sales, up 51 percent from last year, and a 75 percent increase in digital ad revenues.

Mr. Freston said that MTV’s digital offerings help it because they are in demand, command higher prices than television ads and can be combined with television ads to create multiplatform packages that are attractive to advertisers.

Viacom has been expanding its digital offerings, and earlier Wednesday announced an agreement to acquire Atom Entertainment, which owns gaming and short-form video sites.

“As our markets and audience continue to evolve, our business will evolve with them. To that end, digital traffic continues to grow significantly across all of our broadband properties and we believe MTV Networks is now the world’s largest provider of video content to the mobile phone,” Mr. Freston said. “In addition our digital acquisitions, such as Xfire, Gametrailers and Neopets, are operating very well.”