Paramount Posts Mixed Results After Trump Settlement and Skydance Agreement

(Sandy Morris/Paramount+ with Showtime)

Paramount Global posted mixed financial results Thursday, after spending several weeks in the political spotlight.

The company reported second-quarter adjusted earnings of 46 cents a share on revenue of $6.85 billion. Analysts surveyed by FactSet expected the company to post adjusted earnings of 36 cents a share on revenue of $6.87 billion.

In the same period last year, Paramount reported earnings of 54 cents a share on revenue of $6.81 billion.

“Despite an increasingly challenging environment, the talented co-CEOs and teams across the company have continued to strengthen and grow the business,” non-executive chairwoman Shari Redstone said in the earnings release.

Paramount’s streaming service, Paramount+, had 77.7 million global subscribers in the second quarter, which was a drop from last quarter’s 79 million, but beat Wall Street estimates of 77.5 million. Direct-to-consumer revenue of $2.16 billion beat expectations of $2.1 billion and grew 15% from last year. TV media revenue of $4.01 billion was in line with estimates and dropped 6% as the traditional TV advertising market remains under pressure.

Shares of Paramount were down 0.1% in after hours trading following the results. The stock closed 5.5% lower Thursday.

The earnings come after recent headlines involving Paramount, President Donald Trump, Stephen Colbert, the Skydance merger, and South Park.

Trump sued CBS—one of Paramount’s TV channels—in 2024, alleging the network deceitfully edited a 60 Minutes interview with then-Vice President Kamala Harris. Paramount and Trump settled the lawsuit in early July, with Paramount agreeing to pay Trump $16 million but not apologizing. Critics of the controversial settlement—which Trump said on Truth Social was a “big and important win”—pointed out that the deal happened while Paramount was waiting for the Federal Communications Commission to approve its highly-anticipated merger with Skydance.

The FCC ultimately approved the merger between Paramount and Skydance last week. Paramount, which expects the deal to close on Aug. 7, will be known as Paramount Skydance Corporation, and the company will use the new stock ticker PSKY.

Investors, however, likely have been taking stock of the many events that happened between the settlement and the merger’s approval.

Less than a week before the FCC signed off on the merger, CBS announced that it was canceling The Late Show With Stephen Colbert. The move generated national attention, as critics pointed out the cancellation came days after Colbert called the $16 million settlement a “big fat bribe.” CBS has said canceling The Late Show was purely a financial decision.

Three days after the talk show was canceled, Sen. Elizabeth Warren (D.-Mass.), Sen. Bernie Sanders (I-Vt.), and Sen. Ron Wyden (D-Ore.) sent a letter to Skydance CEO David Ellison that said “it is illegal to corruptly give anything of value to federal officials to influence an official act—and if Paramount settles the lawsuit in a quid-pro-quo arrangement to influence the Administration’s assessment of the Paramount-Skydance deal, company officials could be breaking the law.”

Barron’s has reached out to Paramount and Skydance for comment.

One day before the FCC signed off on the merger, Comedy Central—a channel owned by Paramount—and the creators of South Park, one of the most popular shows on the channel—agreed to a five-year deal that was reportedly worth $1.5 billion. The South Park contract was announced the same day the show’s season 27 premiere aired, which included commentary about the Colbert cancellation and crude jokes regarding Trump.

Write to Angela Palumbo at angela.palumbo@dowjones.com