CBS 1Q beats Street on digital, overseas sales

Associated Press + More

By RYAN NAKASHIMA, Associated Press

LOS ANGELES (AP) — CBS Corp. on Tuesday said its net income grew 80 percent in the first quarter, as revenue surged on digital licensing deals for its TV shows and overseas sales of reruns.

Net profit rose to $363 million, or 54 cents per share, from $202 million, or 29 cents per share, a year ago.

Unusual items offset each other; the adjusted earnings of 54 cents per share blew by the 44 cents per share expected by analysts polled by FactSet.

Revenue rose 12 percent to $3.92 billion, also beating the $3.79 billion analysts were looking for.

The company also spent $269 million buying back shares during the quarter.

CBS shares rose 98 cents, or 2.9 percent, to $34.40 in extended trading after the results were released. Shares had closed up 4 cents to close the regular session at $33.42.

Advertising revenue grew 5 percent to $2.4 billion while fees from cable and satellite TV signal providers grew 7 percent to $455 million.

Revenue from content licensing deals jumped 39 percent to $1.02 billion.

"Our ability to capitalize on the fundamental shifts in our industry has led to the growth of significant new revenue streams," CEO Leslie Moonves said in a statement. "At the same time, we continue to benefit from underlying advertising growth."

New York-based CBS has sold older shows for online distribution on Netflix and Amazon and garnered new fees from cable and satellite TV companies for the right to carry the signals of CBS TV stations.

Moonves said that around $30 million in extra revenue came from a deal with Netflix to carry streams of shows like "Dexter" and "Californication" from CBS's Showtime pay TV channel.

Showtime also increased the number of subscribers by 6 percent to more than 21 million.

He said the company's arrangement with Netflix would likely generate even more revenue in 2013. Shows that it cancels on Showtime are automatically sold to Netflix, which could generate a "big bump" in revenue next year, he said.

As a TV studio, CBS makes shows such as "The Good Wife," ''Hawaii Five-O" and "NCIS" and is co-creator of programs like "Criminal Minds" and "Rules of Engagement." It also owns radio and TV stations, outdoor billboards and the Simon & Schuster book publisher.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.