Key Highlights
- Q1 adjusted earnings per share reached $0.23, surpassing Wall Street’s $0.15 projection; total revenue climbed 2% to $7.35 billion
- Paramount+ subscriber base expanded 2% to 79.6 million users, falling marginally short of the 79.9 million target
- Traditional TV Media segment revenue plummeted 19% to $3.67 billion, significantly worse than the anticipated 9.5% decrease
- Second-quarter revenue outlook of $6.75–$6.95 billion came in below Wall Street’s $7.07 billion expectation
- The company’s $81 billion Warner Bros. Discovery merger remains scheduled to finalize by the conclusion of Q3 2026
Shares of Paramount Skydance (PSKY) surged up to 4% during Monday’s extended trading session following the company’s better-than-expected first-quarter financial performance. During Tuesday’s premarket hours, the stock traded 1.5% higher at $11.30, although it continues to trade 17% lower year-to-date.
Paramount Skydance Corporation Class B Common Stock, PSKY
The media giant reported adjusted earnings of $0.23 per share, substantially exceeding the analyst consensus of $0.15. Total revenue increased 2% to reach $7.35 billion, similarly topping Wall Street’s projection of $7.28 billion.
This marked the first quarterly disclosure following the company’s successful February bid to acquire Warner Bros. Discovery.
The streaming division emerged as the performance leader. Paramount’s direct-to-consumer operations generated $2.4 billion in revenue, representing an 11% year-over-year increase. Paramount+ specifically delivered impressive growth with revenue jumping 17% to $1.97 billion.
Subscriber metrics slightly missed projections. Paramount+ concluded the quarter with 79.6 million paying subscribers, reflecting a 2% annual increase but falling marginally below the anticipated 79.9 million. Management attributed subscriber momentum to popular programming including “Landman,” “The Madison,” and “Marshals.”
The studios division also delivered positive results, with revenue advancing 11% to $1.28 billion, propelled by strong theatrical performance from “Scream 7.”
Traditional Television Business Remains Under Pressure
The legacy broadcast and cable operations continue facing headwinds. TV Media segment revenue contracted 19% to $3.67 billion—substantially exceeding the 9.5% decline Wall Street had anticipated. Both advertising revenue and affiliate fees contributed to the downturn.
This represents the persistent structural headwind confronting traditional media companies. Viewers continue shifting consumption habits toward streaming platforms, with advertising budgets increasingly following audience migration.
Second Quarter Forecast Misses Expectations
For the current quarter, management projected revenue between $6.75 billion and $6.95 billion. The midpoint of this range falls below analyst expectations of $7.07 billion.
Executives cited difficult year-over-year comparisons due to particularly strong theatrical releases during the prior year’s corresponding period.
Adjusted EBITDA for the second quarter is forecast between $900 million and $1 billion, exceeding the analyst consensus of $861.8 million.
Management reaffirmed full-year 2026 targets: $30 billion in total revenue and $3.8 billion in adjusted EBITDA.
Paramount also indicated that Paramount+ subscriber growth will remain “flattish” on a sequential basis in Q2. The company is strategically discontinuing approximately 2 million international hard bundle subscriptions as it refines its go-to-market approach.
The Warner Bros. Discovery transaction, carrying an $81 billion valuation, secured shareholder approval on April 23. Management confirmed Monday that the deal remains on schedule to close by the end of Q3 2026, contingent upon regulatory clearance.
CEO David Ellison emphasized in his letter to shareholders that the merged entity intends to distribute 30 theatrical films each year following transaction completion.
Paramount faces direct competition from Netflix and Disney+ in the streaming marketplace, and the Warner acquisition would incorporate HBO Max into its streaming portfolio.
The transaction awaits final regulatory approval, with no additional updates regarding that review process disclosed in Monday’s announcement.
