Stocks/Earnings

Discovery Reports Flat Earnings for Third Quarter

Domestic ad revenue up 3% 11/02/2017 9:08 AM Eastern

Discovery Communications reported flat earnings for the third quarter as it prepares to acquire Scripps Networks Interactive.

Net income was $218 million, or 38 cents a share, in the quarter, down slightly from $219 million, or 36 cents a share.

The quarter included costs related to the acquisition of Scripps Networks, currency losses and losses from solar investments, the company said. (Scripps also released Q3 results this week).

Revenue rose 6% to $1.65 billion.

Operating income at Discovery’s U.S. networks rose 5% to $480 million.

Revenue at the U.S. networks rose 4% to $823 million. Distribution revenue rose 6% to $402 million. Amid concern over cord-cutting, Discovery said total subscribers across its portfolio of networks fell 5% in the quarter, but subscribers to its fully distributed networks was down 3%.

Domestic ad revenue rose 3% to $407 million. The company said ad revenue was up because of higher pricing and monetizing its Go streaming platform. The gains were offset by Group Nine, its new digital content unit. Excluding Group Nine, ad revenue would have been up 4%, the company said.

“Advertising and global distribution revenue growth helped to drive solid third-quarter results for Discovery,” said CEO David Zaslav.

“We continued to focus on investments to strengthen our worldwide IP portfolio as well as strategic partnerships to nourish global superfans across every screen, platform and service,” Zaslav said. "Additionally, we are excited by the prospects for a combined Discovery and Scripps as we continue to make progress on the transaction to create a global leader in real life entertainment."

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