The paragraph describes the beginning of Paramount Global's Q1 2025 Earnings Conference Call, with Nadia as the operator introducing the session and explaining the call procedure. Jamie Morris, EVP of Investor Relations, then introduces Paramount's executive team, including co-CEOs Brian Robbins, Chris McCarthy, George Cheeks, and CFO Naveen Chopra. Morris highlights the availability of supplemental information on their website and issues a standard disclaimer about forward-looking statements. Chris McCarthy comments on the company's strong performance, noting a 2% year-over-year revenue growth, excluding the impact of the Super Bowl.

In Q1, Paramount+ experienced significant growth, increasing its global subscribers to 79 million, a rise of 11% year-over-year. The streaming service's revenue also went up by 16%, driven by a strong content strategy focused on successful original series, such as "Landmine" and "1923." In the U.S., Paramount+ ranked second in top SVOD original content, with notable success from "Dexter: Original Sin" and "Yellowjackets" on its premium tier. Internationally, popular series like "South Park" and "Yellowstone" continue to perform well, with "South Park" set to debut on Paramount+ in the U.S. this July. The overall results reflect the company's emphasis on profitable growth and strategic investments despite a challenging macro environment.

The paragraph discusses the success and expansion of the Yellowstone series franchise internationally, mentioning upcoming premieres such as Dutton Ranch, The Marshals, and the anthology series 1944. It highlights the strong lineup of new and returning series on Paramount+, including MobLand, Criminal Minds: Evolution, and Dexter Resurrection. Upcoming releases also include extensions of popular series like NCIS, Tulsa King, and Mayor of Kingstown. The paragraph notes Pluto TV's growth in viewership, though monetization has been slower due to increased supply. Overall, strong progress in subscriber growth and a disciplined investment strategy are driving improved profitability for their direct-to-consumer services.

The paragraph highlights Paramount's strategic focus on content investments in sports, news, and entertainment to boost revenue and cost efficiency across linear and streaming platforms. Paramount has renewed key affiliate deals to ensure continued revenue growth and support streaming expansion. Despite flat advertising revenue in TV media year-over-year, live sports content like the NFL playoffs and March Madness proved highly valuable. The company underscores its broad programming reach and impact across various platforms, maintaining strong audience numbers. CBS, in particular, achieved significant viewership milestones with major events like the NCAA championship and the Masters. It remains the most-watched broadcast network for a record-setting 17th consecutive season, with notable growth in audience size and streaming viewership.

The paragraph discusses the strong performance and future plans of CBS and its related film and entertainment ventures. CBS has secured six of the top 20 spots in broadcast and streaming ratings, with popular shows like Tracker and Matlock. The network announced new shows for the 2025-2026 season, including expansions of existing franchises and a new procedural drama from the Yellowstone universe. In film entertainment, the success of "Sonic the Hedgehog 3" and "Gladiator 2" on Paramount+ has been highlighted, with "Mission: Impossible - The Final Reckoning" set to premiere as a major global event. The overall strategy focuses on balanced investment and monetizing content across different platforms.

The studio has strategically built a diverse slate of films this year to enhance profitability, including major titles like Mission Impossible and reboots such as The Running Man and The Naked Gun. They have also focused on reducing production costs by 35% over the past two years. The company remains optimistic about their future due to successful execution across various entertainment sectors, including films, series, and live sports. They are also nearing the completion of a deal with Skydance. Financially, Paramount reported Q1 revenue of $7.2 billion and adjusted OIBDA of $688 million, with D2C revenues showing healthy growth despite a decline in advertising revenue compared to last year's Super Bowl.

In the paragraph, DTC advertising decreased by 1% due to an increase in digital video supply, impacting Pluto TV significantly. However, D2C OIBDA improved by $177 million, reducing the loss to $109 million, thanks to strong subscription growth and expense management. TV media revenue and OIBDA trends were influenced by the previous year's Super Bowl broadcast by CBS, with flat advertising revenue year-over-year, but improvements compared to Q4 trends. Linear advertising benefited from sports demand, while affiliate revenue declined due to subscriber losses and recent renewals. TV Media OIBDA reached $922 million, with a 4% expense reduction. Film entertainment revenue grew to $627 million, a 4% increase, and OIBDA reached $20 million, aided by Sonic the Hedgehog 3's success. Looking ahead to Q2, robust sports demand is expected to continue, with digital advertising trends likely mirroring Q1. Paramount+ anticipates revenue growth from increased ARPU, aiming for domestic profitability this year.

The paragraph discusses the financial outlook and strategic priorities of Paramount Global. It mentions that the combination of traditional and streaming businesses is expected to yield net growth in revenue, though Q2 subscribers may decline due to seasonality and the end of an international partnership. The film segment, despite strong revenue from the release of "Mission: Impossible - The Final Reckoning," is anticipated to face an OIBDA loss due to marketing expenses. Free cash flow is expected to be similar to the previous year, with $100 million in restructuring payments. Paramount aims for domestic profitability of Paramount+ by 2025 and remains focused on full-year OIBDA and cash flow targets, despite potential macroeconomic uncertainties affecting advertising. Strategic priorities include D2C growth, profitability improvements, leveraging broadcast capabilities, cost efficiencies, and maximizing IP value, positioning the company for long-term success. The paragraph concludes with an invitation for questions from Steven Cahall of Wells Fargo.

The paragraph discusses advertising dynamics, particularly focusing on digital advertising and Pluto. Chris McCarthy notes that while there's current pricing pressure due to increased digital inventory from new market entrants, he expects this to stabilize as supply-demand dynamics balance out. Although this stabilization hasn't been observed yet, McCarthy is confident it will occur. Meanwhile, CBS Sports and successful programming have helped compensate for digital space softness in total ad sales. Additionally, McCarthy expresses satisfaction with the engagement levels on platforms like Paramount+ and Pluto. The paragraph also mentions potential implications of the FCC's stance on reverse compensation and affiliate revenue, highlighting a figure of over a billion dollars without providing a specific future outlook.

The paragraph features a discussion involving George Cheeks and Brian Robbins about the relationships between CBS, its affiliates, and its content strategy. Cheeks emphasizes the mutually beneficial relationship between CBS and its affiliates, highlighting investments in live sports and primetime entertainment. He underscores the importance of these partnerships by mentioning the recent renewal of 60 CBS affiliates. Robert Fishman raises questions about CBS's content licensing strategy, specifically the balance between licensing content to third-party streamers versus keeping content exclusive to Paramount+. He also inquires about CBS's approach to acquiring additional sports rights. Brian Robbins responds, affirming that content licensing, especially secondary licensing, remains a growth opportunity due to the high demand for their content.

The paragraph features a discussion among executives, with Chris McCarthy emphasizing the importance of using valuable intellectual property to grow their own assets, while still being open to licensing deals. Robert discusses the company's robust sports portfolio, highlighting a disciplined and opportunistic approach to acquiring sports rights. Ben Swinburne from Morgan Stanley asks Naveen about the dynamics between linear declines and streaming growth. Naveen responds by explaining the major factors influencing the linear side of their business, which include the decline in pay TV subscribers and the nature of their negotiated deals.

The paragraph discusses key revenue trends and future expectations for a media company, highlighting that subscriber decline is a primary factor affecting revenue. While deal renewals have had some impact recently, the trend seen in Q1 is expected to continue in the upcoming quarters. On the streaming side, growth is driven by subscriber increase, improvements in churn, and ARPU, which enhance revenue and profitability due to the fixed-cost nature of the business. The discussion shifts to a Q&A where Richard Greenfield questions Chris McCarthy about Paramount's relationship with Taylor Sheridan and the potential acquisition of 101 Studios, indicating the importance of Sheridan to Paramount's strategy. Chris acknowledges the value of both parties involved.

The paragraph discusses the strong partnerships and collaborations that Paramount has with Taylor, a creative talent, and the production company 101. Taylor is under an exclusive contract with Paramount until 2028, and Paramount owns all intellectual property arising from their collaboration. The partnership with Taylor has been successful, allowing Paramount to develop innovative models to attract other creatives like Jez Butterworth. Additionally, MobLand, a recent release, became the biggest global premiere on Paramount+. Paramount also values its ongoing relationship with 101 and plans to maintain its current processes and partnerships with both entities.

In the paragraph, Chris McCarthy discusses the success and growth of their streaming platform, which has reached nearly 80 million global subscribers and seen a 16% revenue increase this quarter. He highlights the strength of their content offerings, including CBS primetime shows, sports, and streaming originals, and mentions they are close to achieving domestic profitability for Paramount+. While they are open to exploring opportunities such as bundling and partnerships, they have no specific announcements at the moment. McCarthy emphasizes their strategic approach to considering bundles, such as their successful partnership with Walmart, and their focus on creating value and accelerating their plans.

In the paragraph, Kutgun Maral from Evercore ISI asks about the drivers of strong TV media performance and linear trends as they approach the upfronts, as well as seeking clarification on full-year guidance for OIBDA and free cash flow. Chris McCarthy responds positively, highlighting CBS's 17 consecutive quarters at number one, sports driving revenue, and strong upfront discussions, noting an increase in scatter as an encouraging indicator. He acknowledges macroeconomic concerns but reports positive feedback on their assets and sports portfolio. Naveen Chopra thanks Chris for his comments.

The paragraph discusses the company's 2025 earnings improvement plan, emphasizing key drivers like enhanced B2C profitability, reduced expenses, and better content investment leverage across various business areas such as streaming and theatrical. Despite a dynamic macroeconomic environment and possible revenue impacts, particularly in advertising, the company is focusing on further expense reductions. Chris McCarthy expresses gratitude on behalf of the co-CEOs for the progress made and thanks the teams and partners for their efforts. The call then concludes with a thank you from the operator.

This summary was generated with AI and may contain some inaccuracies.