Hit TV Shows and Movies Help Time Warner Offset Losses
Hit sitcoms like “2 Broke Girls” and “Big Bang Theory” helped offset losses at Time Warner’s magazine division and costs related to early cancellation of the pricey horse-racing drama “Luck” on HBO.
In the three-month period that ended April 27, net income at Time Warner fell 11 percent to $581 million compared with $681 million in the same period a year ago. Both periods amounted to 59 cents a share, since the company had fewer shares outstanding in its most recent quarter. Operating income fell 2 percent to $1.2 billion, while adjusted income rose 6 percent, to $1.4 billion, beating media analysts’ expectations.
The cancellation of “Luck,” one of HBO’s most anticipated and costly dramas, cost Time Warner $35 million. The company also had a $52 million charge for shuttering one of its Indian networks.
Revenue grew 4 percent from a year earlier to $7 billion, due mostly to gains at the Warner Brothers movie and television studio: “Sherlock Holmes: A Game of Shadows” took in more than $535 million globally.
Reruns of “The Big Bang Theory” helped bolster TBS’s ratings, making the channel the No. 1-rated cable channel among adults ages 18 to 49.
Time Inc., the publisher of magazines including People, Time, Sports Illustrated and InStyle, continued to underperform, with adjusted operating income falling 38 percent, to $39 million, driven mostly by the decline of advertising revenue at the company’s domestic magazines.
Jeffrey L. Bewkes, chief executive of Time Warner, praised the company’s film and television assets and the HBO Go app that allows subscribers to watch HBO’s series and specials. He also anticipated a strong year with the release of movies like “The Dark Knight Rises” and Peter Jackson’s “The Hobbit.”