Paramount’s Earnings Present an Uphill Battle

Four big questions re: Paramount + streaming:
1) How much revenue is Paramount generating from direct-to-consumer?2) How many subscribers do they have?
3) What share of total TV time do Pluto TV and Paramount+ account for?4) How much does Paramount spend on content?

Setting the table: Paramount has two primary streaming services in the U.S.:
1) Paramount+ – Subscription based with an ad-free option
2) Pluto TV – Free ad-supported streaming TV (FAST)

Big question #1: How much revenue is Paramount generating from direct-to-consumer?

Paramount’s 2023-Q1 streaming revenue (% of total):
1) Subscription – $1.1B (74%)
2) Advertising – $398M (26%)
3) Total – $1.5B

Paramount streaming ad revenue (YoY growth):
1) 2022-Q1 – $347M
2) 2023-Q1 – $398M (↑ 15%)

Paramount streaming subscription revenue (YoY growth):
1) 2022-Q1 – $742M
2) 2023-Q1 – $1.1B (↑ 50%)

Bottom line: Despite growing revenue by 50%, streaming still lost $511M.

Paramount streaming profit (YoY growth):
1) 2022-Q1 – –$456M
2) 2023-Q1 – –$511M (↓ 12%)

Why this matters: Paramount needs to cut costs.  On Tuesday, they announced plans to lay off 25% of their U.S. staff.

Big question #2: How many subscribers do they have?

Pluto TV global monthly active users (YoY growth):
1) 2021-Q1 – 50M
2) 2022-Q1 – 68M (↑ 37%)
3) 2023-Q1 – 80M (↑ 18%) 

Paramount+ subscribers (YoY growth):
1) 2021-Q1 – 17M
2) 2022-Q1 – 40M (↑ 140%)
3) 2023-Q1 – 60M (↑ 52%)

Interesting: Paramount (Paramount+ and Showtime) accounted for 26% of all net subscriber additions in the U.S. last year.

Big question #3: What share of total TV time do Pluto TV and Paramount+ account for?

Quick answer: Pluto TV accounts for 1% of total TV time and 2% of streaming TV time.  Paramount+ accounts for less than 0.8% of total TV time.

Big question #4: How much does Paramount spend on content?

Estimated U.S. content spend for Paramount (YoY growth) according to Wells Fargo:
1) 2019 – $13.4B
2) 2020 – $14.0B (↑ 4%)
3) 2021 – $15.3B (↑ 9%)
4) 2022P – $16.4B (↑ 7%)
5) 2023P – $17.8B (↑ 9%)
6) 2024P – $19.5B (↑ 10%)
7) 2025P – $21.7B (↑ 11%)

More: “It Was Lighting in a Bottle”: An Oral History of MTV News

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