EARNINGS PRESS RELEASE | April 29, 2024

PARAMOUNT REPORTS Q1 2024 EARNINGS RESULTS

  • Paramount+ Increased Revenue 51% Year-Over-Year and Reached More Than 71 Million Global Subscribers
  • Direct-To-ConsumerAdjusted OIBDA Improved Year-Over-Year for the 4th Consecutive Quarter
  • Total Advertising Revenue Rose 17%; Total Company Revenue Increased 6%
  • Generated $260 Million of Net Operating Cash Flow and $209 Million of Free Cash Flow in Q1

STATEMENT FROM NAVEEN CHOPRA, EXECUTIVE VICE PRESIDENT & CHIEF FINANCIAL OFFICER

The team delivered another quarter of strong operational and financial performance - including significant growth in total company earnings and free cash flow - despite the dynamic environment we continue to operate in. It was a record-setting quarter for Paramount+ in engagement and revenue, and in the DTC segment as we continued to substantially narrow streaming losses. And CBS dominated with its powerful combination of sports and the return of a delayed fall slate that launched to massive audiences. As we look ahead, we remain focused on execution and transforming our cost base to best position Paramount for the future.

$ IN MILLIONS, EXCEPT PER SHARE AMOUNTS

GAAP

Three Months Ended March 31

2024 2023 B/(W)%

Revenue

$

7,685

$

7,265

6 %

▪

TV Media

5,231

5,193

1 %

▪

Direct-to-Consumer

1,879

1,510

24 %

▪

Filmed Entertainment

605

588

3 %

▪

Eliminations

(30)

(26)

(15)%

Operating loss

$

(417)

$

(1,226)

66 %

Diluted EPS from continuing operations attributable to Paramount

$

(.88)

$

(1.81)

51 %

Non-GAAP†

Adjusted OIBDA

$

987

$

548

80 %

Adjusted diluted EPS from continuing operations attributable to Paramount

$

.62

$

.09

589 %

† Non-GAAP measures are detailed in the Supplemental Disclosures at the end of this release.

*Simon & Schuster, which was sold in October 2023, has been presented as a discontinued operation in the companyʼs consolidated financial statements. B/(W) - Better/(Worse)

Q1 2024 EARNINGS - SEGMENTS

DIRECT-TO-CONSUMER

OVERVIEW

DTC Adjusted OIBDA improved year-over-year driven by a continued focus on engagement, revenue and operating leverage.

Q1 FINANCIALS

  • Revenue increased 24% year-over-year.
    • Subscription revenue grew 22%, driven by subscriber growth and pricing increases for Paramount+.
    • Advertising revenue rose 31%, driven by growth from Pluto TV and Paramount+, including the benefit of Super Bowl LVIII.
    • Paramount+ revenue grew 51%, reflecting subscriber growth and ARPU expansion.
      • Paramount+ subscribers reached more than 71 million, with 3.7 million net additions in the quarter.
      • Paramount+ global ARPU expanded 26% year-over-year.
  • Adjusted OIBDA increased 44% year-over-year, led by improvement in Paramount+ domestic profitability.

$ IN MILLIONS

Three Months Ended March 31

2024

2023

$ B/(W) %

Revenue

$

1,879

$

1,510

$

369

24 %

▪

Advertising

520

398

122

31

▪

Subscription

1,359

1,112

247

22

Expenses

2,165

2,021

(144)

(7)

Adjusted OIBDA

$

(286)

$

(511)

$

225

44 %

A Gentleman in Moscow

Halo

Source: Antenna

*We calculate average revenue per subscriber ("ARPU") as total Paramount+ revenues during the applicable period divided by the average of Paramount+

2

subscribers at the beginning and end of the period, further divided by the number of months in the period.

Q1 2024 EARNINGS - SEGMENTS

TV MEDIA

OVERVIEW

TV Media revenue and earnings in the quarter benefited from the most watched Super Bowl of all time. Notably, CBS is poised to claim the #1 spot in broadcast for the 16th straight season and is home to the top three new series on broadcast in Tracker, Elsbeth and NCIS: Sydney.

Q1 FINANCIALS

  • Revenue grew 1% to $5.2 billion.
    • Advertising revenue increased 14%, reflecting a 23-percentage point benefit from CBS' broadcast of Super Bowl LVIII.
    • Affiliate and subscription revenue decreased 3%, driven by subscriber declines, partially offset by pricing increases.
    • Licensing and other revenue decreased 25%, including the impact from 2023 labor strikes on content available for licensing.
  • Adjusted OIBDA was $1.4 billion - an 11% increase - driven by the benefit from the broadcast of Super Bowl LVIII.

$ IN MILLIONS

Three Months Ended March 31

2024

2023

$ B/(W) %

Revenue

$

5,231

$

5,193

$

38

1 %

▪

Advertising

2,582

2,256

326

14

▪

Affiliate and subscription

1,998

2,067

(69)

(3)

▪

Licensing and other

651

870

(219)

(25)

Expenses

3,786

3,887

101

3

Adjusted OIBDA

$

1,445

$

1,306

$

139

11 %

Super Bowl LVIII

NCIS: Sydney

Tracker

Elsbeth

3

Q1 2024 EARNINGS - SEGMENTS

FILMED ENTERTAINMENT

OVERVIEW

Filmed Entertainment generated significant revenue in the quarter with Mean Girls and Bob Marley: One Love each debuting #1 at the domestic box office and together generating over $275 million at the global box office to date.

Q1 FINANCIALS

  • Revenue increased 3%.
    • Theatrical revenues grew 20%, driven by the strong performances of Mean Girls and Bob Marley: One Love, and Miramax's release of The Beekeeper.
    • Licensing and other revenue decreased 1%.
  • Adjusted OIBDA improved $96 million, reflecting the timing and mix of theatrical releases in each year.

$ IN MILLIONS

Three Months Ended March 31

2024

2023

$ B/(W) %

Revenue

$

605

$

588

$

17

3 %

▪

Advertising

1

5

(4)

(80)

▪

Theatrical

153

127

26

20

▪

Licensing and other

451

456

(5)

(1)

Expenses

608

687

79

11

Adjusted OIBDA

$

(3)

$

(99)

$

96

97 %

4

ABOUT PARAMOUNT

Paramount (NASDAQ: PARA; PARAA) is a leading global media, streaming and entertainment company that creates premium content and experiences for audiences worldwide. Driven by iconic consumer brands, its portfolio includes CBS, Paramount Pictures, Nickelodeon, MTV, Comedy Central, BET, Paramount+ and Pluto TV. The company holds one of the industry's most extensive libraries of TV and film titles. In addition to offering innovative streaming services and digital video products, Paramount provides powerful capabilities in production, distribution and advertising solutions.

For more information about Paramount, please visit www.paramount.com and follow @ParamountCo on social platforms.

PARA-IR

CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS

This communication contains both historical and forward-looking statements, including statements related to our future results, performance and achievements. All statements that are not statements of historical fact are, or may be deemed to be, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Similarly, statements that describe our objectives, plans or goals are or may be forward-looking statements. These forward-looking statements reflect our current expectations concerning future results and events; generally can be identified by the use of statements that include phrases such as "believe," "expect," "anticipate," "intend," "plan," "foresee," "likely," "will," "may," "could," "estimate" or other similar words or phrases; and involve known and unknown risks, uncertainties and other factors that are difficult to predict and which may cause our actual results, performance or achievements to be different from any future results, performance or achievements expressed or implied by these statements. These risks, uncertainties and other factors include, among others: risks related to our streaming business; the adverse impact on our advertising revenues as a result of advertising market conditions, changes in consumer viewership and deficiencies in audience measurement; risks related to operating in highly competitive and dynamic industries, including cost increases; the unpredictable nature of consumer behavior, as well as evolving technologies and distribution models; risks related to our ongoing changes in business strategy, including investments in new businesses, products, services, technologies and other strategic activities; the potential for loss of carriage or other reduction in or the impact of negotiations for the distribution of our content; damage to our reputation or brands; losses due to asset impairment charges for goodwill, intangible assets, FCC licenses and content; liabilities related to discontinued operations and former businesses; risks related to environmental, social and governance (ESG) matters; evolving business continuity, cybersecurity, privacy and data protection and similar risks; content infringement; domestic and global political, economic and regulatory factors affecting our businesses generally; disruptions to our operations as a result of labor disputes; the inability to hire or retain key employees or secure creative talent; volatility in the prices of our common stock; potential conflicts of interest arising from our ownership structure with a controlling stockholder; and other factors described in our news releases and filings with the Securities and Exchange Commission, including but not limited to our most recent Annual Report on Form 10-K and reports on Form 10-Q and Form 8-K. There may be additional risks, uncertainties and factors that we do not currently view as material or that are not necessarily known. The forward-looking statements included in this communication are made only as of the date of this communication, and we do not undertake any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances.

5

Q1 2024 EARNINGS - FINANCIAL STATEMENTS

PARAMOUNT GLOBAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited; in millions, except per share amounts)

Three Months Ended March 31

2024

2023

Revenues

$

7,685

$

7,265

Costs and expenses:

Operating

5,036

4,964

Programming charges

1,118

1,674

Selling, general and administrative

1,662

1,753

Depreciation and amortization

100

100

Restructuring charges

186

-

Total costs and expenses

8,102

8,491

Operating loss

(417)

(1,226)

Interest expense

(221)

(226)

Interest income

45

35

Loss from investment

(4)

-

Other items, net

(38)

(46)

Loss from continuing operations before income taxes and equity in loss of

investee companies

(635)

(1,463)

Benefit from income taxes

172

381

Equity in loss of investee companies, net of tax

(90)

(75)

Net loss from continuing operations

(553)

(1,157)

Net earnings from discontinued operations, net of tax

9

45

Net loss (Paramount and noncontrolling interests)

(544)

(1,112)

Net earnings attributable to noncontrolling interests

(10)

(6)

Net loss attributable to Paramount

$

(554)

$

(1,118)

Amounts attributable to Paramount:

Net loss from continuing operations

$

(563)

$

(1,163)

Net earnings from discontinued operations, net of tax

9

45

Net loss attributable to Paramount

$

(554)

$

(1,118)

Basic net earnings (loss) per common share attributable to Paramount:

Net loss from continuing operations

$

(.88)

$

(1.81)

Net earnings from discontinued operations

$

.01

$

.07

Net loss

$

(.87)

$

(1.74)

Diluted net earnings (loss) per common share attributable to Paramount: (a)

Net loss from continuing operations

$

(.88)

$

(1.81)

Net earnings from discontinued operations

$

.01

$

.07

Net loss

$

(.87)

$

(1.74)

Weighted average number of common shares outstanding:

Basic

654

651

Diluted

654

651

  1. Diluted net loss per common share ("EPS") for the three months ended March 31, 2024 and 2023, excludes the effect of the assumed conversion of our 5.75% Series A Mandatory Convertible Preferred Stock to shares of common stock since it would have been antidilutive. As a result, in the calculations of diluted EPS the weighted average number of diluted shares outstanding does not include the assumed issuance of shares upon conversion of preferred stock, and preferred stock dividends recorded during each of the three months ended March 31, 2024 and 2023 of $14 million are deducted from net loss from continuing operations and net loss.

7

Q1 2024 EARNINGS - FINANCIAL STATEMENTS

PARAMOUNT GLOBAL AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited; in millions, except per share amounts)

At

At

March 31, 2024

December 31, 2023

ASSETS

Current Assets:

Cash and cash equivalents

$

2,384

$

2,460

Receivables, net

7,096

7,115

Programming and other inventory

892

1,414

Prepaid expenses and other current assets

1,511

1,677

Current assets of discontinued operations

49

37

Total current assets

11,932

12,703

Property and equipment, net

1,612

1,666

Programming and other inventory

13,420

13,851

Goodwill

16,500

16,516

Intangible assets, net

2,580

2,589

Operating lease assets

1,117

1,183

Deferred income tax assets, net

1,244

1,242

Other assets

3,622

3,793

Total Assets

$

52,027

$

53,543

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:

Accounts payable

$

787

$

1,100

Accrued expenses

1,728

2,104

Participants' share and royalties payable

2,625

2,702

Accrued programming and production costs

1,994

1,842

Deferred revenues

671

746

Debt

1

1

Other current liabilities

1,438

1,161

Total current liabilities

9,244

9,656

Long-term debt

14,607

14,601

Participants' share and royalties payable

1,337

1,394

Pension and postretirement benefit obligations

1,332

1,337

Deferred income tax liabilities, net

273

503

Operating lease liabilities

1,199

1,256

Program rights obligations

204

204

Other liabilities

1,494

1,542

Commitments and contingencies

Paramount stockholders' equity:

5.75% Series A Mandatory Convertible Preferred Stock, par value $.001 per share;

-

-

25 shares authorized; 10 (2024 and 2023) shares issued

Class A Common Stock, par value $.001 per share; 55 shares authorized;

-

-

41 (2024 and 2023) shares issued

Class B Common Stock, par value $.001 per share; 5,000 shares authorized;

1

1

1,117 (2024) and 1,115 (2023) shares issued

Additional paid-in capital

33,240

33,210

Treasury stock, at cost; 503 (2024 and 2023) shares of Class B Common Stock

(22,958)

(22,958)

Retained earnings

13,226

13,829

Accumulated other comprehensive loss

(1,615)

(1,556)

Total Paramount stockholders' equity

21,894

22,526

Noncontrolling interests

443

524

Total Equity

22,337

23,050

Total Liabilities and Equity

$

52,027

$

53,543

8

Q1 2024 EARNINGS - FINANCIAL STATEMENTS

PARAMOUNT GLOBAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited; in millions)

Three Months Ended

March 31

2024

2023

Operating Activities:

$

(544)

$

(1,112)

Net loss (Paramount and noncontrolling interests)

Less: Net earnings from discontinued operations, net of tax

9

45

Net loss from continuing operations

(553)

(1,157)

Adjustments to reconcile net loss from continuing operations to net cash flow

provided by (used for) operating activities from continuing operations:

Depreciation and amortization

100

100

Programming charges

1,118

1,674

Deferred tax benefit

(231)

(436)

Stock-based compensation

47

39

Loss from investment

4

-

Equity in loss of investee companies, net of tax

90

75

Change in assets and liabilities

(315)

(778)

Net cash flow provided by (used for) operating activities from continuing operations

260

(483)

Net cash flow provided by operating activities from discontinued operations

-

105

Net cash flow provided by (used for) operating activities

260

(378)

Investing Activities:

Investments

(88)

(43)

Capital expenditures

(51)

(71)

Other investing activities

11

25

Net cash flow used for investing activities

(128)

(89)

Financing Activities:

-

35

Proceeds from issuance of debt

Repayment of debt

-

(32)

Dividends paid on preferred stock

(14)

(14)

Dividends paid on common stock

(35)

(166)

Payment of payroll taxes in lieu of issuing shares for stock-based compensation

(17)

(16)

Payments to noncontrolling interests

(94)

(89)

Other financing activities

(27)

(30)

Net cash flow used for financing activities

(187)

(312)

Effect of exchange rate changes on cash and cash equivalents

(21)

3

Net decrease in cash and cash equivalents

(76)

(776)

Cash and cash equivalents at beginning of year

2,460

2,885

Cash and cash equivalents at end of period

$

2,384

$

2,109

9

Q1 2024 EARNINGS - Supplemental Disclosures

SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES

(Unaudited; in millions, except per share amounts)

Results for the three months ended March 31, 2024 and 2023 included certain items identified as affecting comparability. Adjusted operating income before depreciation and amortization ("Adjusted OIBDA"), adjusted earnings from continuing operations before income taxes, adjusted provision for income taxes, adjusted net earnings from continuing operations attributable to Paramount, adjusted diluted EPS from continuing operations, and adjusted effective income tax rate (together, the "adjusted measures") exclude the impact of these items and are measures of performance not calculated in accordance with accounting principles generally accepted in the United States of America ("GAAP"). We use these measures to, among other things, evaluate our operating performance. These measures are among the primary measures used by management for planning and forecasting of future periods, and they are important indicators of our operational strength and business performance. In addition, we use Adjusted OIBDA to, among other things, value prospective acquisitions. We believe these measures are relevant and useful for investors because they allow investors to view performance in a manner similar to the method used by our management; provide a clearer perspective on our underlying performance; and make it easier for investors, analysts and peers to compare our operating performance to other companies in our industry and to compare our year-over-year results.

Because the adjusted measures are measures of performance not calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, operating income (loss), earnings (loss) from continuing operations before income taxes, (provision for) benefit from income taxes, net earnings (loss) from continuing operations attributable to Paramount, diluted EPS from continuing operations, and effective income tax rate, as applicable, as indicators of operating performance. These measures, as we calculate them, may not be comparable to similarly titled measures employed by other companies.

The following tables reconcile the adjusted measures to their most directly comparable financial measures in accordance with GAAP.

Three Months Ended March 31

2024

2023

Operating loss (GAAP)

$

(417)

$

(1,226)

Depreciation and amortization

100

100

Programming charges (a)

1,118

1,674

Restructuring charges (a)

186

-

Adjusted OIBDA (Non-GAAP)

$

987

$

548

(a) See notes on the following tables for additional information on items affecting comparability.

10

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Paramount Global published this content on 29 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 April 2024 20:04:01 UTC.