Paramount Global CFO Naveen Chopra indicated streaming losses would total about $1.8 billion this year, higher than Wall Street expected, but stuck to the company’s target of peak DTC losses in 2023.
The business lost $901 million in the first half of this year. Chopra anticipated the same in the second half given a choppy advertising market. Adjusted OIBDA — a measure of operating income — was a negative $445 million for the second quarter ended in June.
“We just have to let it play out a bit and manage through some economic headwinds,” he said on a call following first-quarter earnings. Analysts sought but didn’t get any timeline for reaching breakeven/profitability after 2023.
The stock was down a steep 4% earlier today with investors spooked overall by streaming spend and profit visibility across the sector. It’s regained ground, down just hair late morning.
Chopra also reiterated the company’s $6 billion spending target though 2024 but stressed that’s content is leveraged across platforms.
“On contend spend, the most important thing to remember is that when we think about our content investment, we are always looking at it in term of the growth and the return it unlocks.” With streaming revenue and subscriber count growing, “Our content investment is working,” he said. “We don’t want to sacrifice a long-term opportunity.”