- Associated Press - Thursday, August 2, 2012

LOS ANGELES (AP) - CBS Corp.’s net income rose 8 percent in the second quarter, beating analysts’ expectations even as advertising revenue fell and it took in less money from the sale of program reruns.

CBS was unable to match last year’s second quarter revenue performance because in 2011 it received a large bump from a TV licensing deal with Netflix. Last year also saw the semifinals of the March Madness NCAA college basketball tournament occur during the April-June quarter.

Net income in the three months to June 30 rose to $427 million, or 65 cents per share. That handily beat the 59 cents per share expected by analysts polled by FactSet.

Revenue slipped 3 percent to $3.48 billion, below the $3.53 billion expected.

In the current quarter, CEO Les Moonves conceded that the market for last-minute ad buys is showing some “softness”. He blamed NBC’s coverage of the London Olympics for taking away a lot of the available viewers and ad dollars.

Moonves said the market will return to normal in September, when the fall TV season begins and CBS begins to benefit from higher commercial prices that it locked in during the bulk sales period known as the upfronts earlier this year. He also expects political ad sales to break records ahead of the presidential election in November.

“We’re ready for the gun to go off in the middle of September,” Moonves told analysts on a conference call.

Still, analysts were concerned that the lack of stellar results might mean the ad market is slipping.

“I think the question is, `Is the ad market softening?” said Robin Dietrich, an analyst with Edward Jones. “The economic news as of late has not been all that favorable.”

Advertising revenue fell 3 percent to $2.14 billion while rerun sales fell 8 percent to $816 million. Fees from TV distributors who pay to carry the CBS network and its Showtime channel rose 8 percent to $465 million.

Overall, the company said advertising revenue in the second quarter reflected a “steady marketplace.”

Profits went up despite the revenue fall partly because fees from distributors are more profitable than ad sales. The shift of some college basketball games into the first quarter also reduced programming costs in the second quarter.

CBS’ stock slipped a penny in after-hours trading to $33.03. In the last year, it has traded in a range of $17.99 to $35.