- Associated Press - Thursday, November 3, 2011

NEW YORK (AP) - Broadcasting company CBS Corp. said Thursday that its third-quarter net income rose 7 percent, helped by new online streaming deals for its content as advertising revenue “held steady” despite lower political ad spending.

Despite beating earnings forecasts, the company’s revenue fell short of analysts’ estimates. Shares fell 27 cents, or 1.1 percent, to $24.25 in after-hours trading.

Net income in the three months to Sept. 30 grew to $338 million, or 50 cents per share, from $317 million, or 46 cents per share, a year ago.

That beat the 46 cents per share expected by analysts polled by FactSet.

Revenue increased 2 percent to $3.37 billion from $3.3 billion, but was short of the $3.44 billion expected by analysts.

The company said gains in ad revenue at its CBS network in prime time and at the company’s outdoor billboards in the Americas helped offset lower political ad spending. That compared to a 3 percent gain in overall ad revenue in the second quarter.

The results suggest a slowdown in local advertising, a trend that echoes rival News Corp.’s assessment on Wednesday that ad sales at local TV stations would be softer in the quarter through December. News Corp. said ad revenue at its local Fox TV stations in the current quarter would be down 10 percent from a year ago, but flat when excluding last year’s bump in political ad spending.

CBS is aiming to offset fluctuations in ad spending by making new deals for its content. In July, CBS agreed to let Netflix Inc. customers in Canada and Latin America stream reruns of CBS shows such as “90210” along with older episodes from original series at its Showtime pay TV channel, including “Californication” and “Dexter.”

It also signed a deal that allows members of Amazon.com Inc.’s Amazon Prime annual free shipping program to stream older CBS shows online.

“We continue to monetize our enormous library on new platforms, including domestic and international streaming deals signed since last quarter worth hundreds of millions of dollars,” CBS Chief Executive Leslie Moonves said in a statement. “These content licensing deals are increasing the stability of our revenue base.”

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