Discovery said second-quarter net income fell 71% after the coronavirus pandemic spurred a pullback in advertising at both its U.S. and international operations, even as its TLC cable network garnered new levels of viewership during the period.
The New York owner of the Discovery, Food Network and HGTV cable networks, said it posted second quarter profit of $271 million or 40 cents per share, compared with $947 million, or $1.33 a share, in the year-earlier period. Adjusted for one-time items, the company reported profit in the period of 77 cents per share.
Meanwhile, revenue fell 12% during the period, to $2.54 billion compared with nearly $2.89 billion in the year-earlier period, largely due to a 14% decline in advertising at its U.S. operations.
The results were better than what Wall Street had expected. Analysts had called for earnings of 75 cents per share.
The company is seeing “initial signs of stabilization” in “many of our key markets,” said David Zaslav, the company’s president and CEO, in a statement, indicating that Discovery intended to “resume returning capital to shareholders through share repurchases.” He said the company was “cautiously optimistic about the global outlook for the rest of the year.”
Discovery said revenue from distribution rose in the U.S. and noted U.S. operating expenses fell 6%. Distribution was off internationally by 2%, due to the loss of live sporting events the company broadcasts overseas. Operating expenses were down 20%, due in part to the loss of sports.
