Read full article Yahoo Finance Paramount will reportedly announce CEO Bob Bakish’s departure amid deal talks Alexandra Canal · Senior Reporter Mon, Apr 29, 2024, 5:36 PM 3 min read Link Copied 0 In this article:
Paramount Global ( PARA ) is expected to announce the departure of CEO Bob Bakish, according to multiple media reports .The news comes as investors eye the company’s deal-making options.
Bakish’s potential departure was first reported by the Wall Street Journal , which said an announcement could come as soon as Monday amid the CEO’s growing tensions with Shari Redstone, who controls Paramount through her family’s holding company National Amusements.According to the report, Paramount would install an “Office of the CEO” consortium made up of company division heads in place of Bakish.
National Amusements is currently in exclusive talks with David Ellison’s Skydance Media to sell its controlling stake in Paramount, according to a source familiar with the matter.
But Paramount’s nonvoting shareholders have publicly expressed concerns over the terms of the deal, which critics say unfairly benefits Redstone.The company’s exclusivity window with Skydance expires on May 3.
Meanwhile, Sony Pictures Entertainment and private equity firm Apollo Global Management have also been in talks over a joint bid to buy Paramount, according to media reports .(Disclosure: Yahoo Finance is owned by Apollo.)
“The clock is ticking for Ms.
Redstone to come to a decision as we believe Paramount’s distribution deal with Charter is set to expire at the end of the month,” MoffettNathanson analyst Robert Fishman wrote in a note published April 22.
Fishman said Disney’s precedent-setting deal with Charter could have a meaningful impact on Paramount “should Charter choose to either drop Paramount’s long tail cable networks and/or force Paramount+ to be bundled at a heavily discounted wholesale price to Charter subscribers.”
Ultimately, though, the fate of Paramount’s future all comes down Redstone.
“While shareholders can make appeals for her to reconsider the Apollo/Sony deal that better serves their interests, Redstone seems set on crossing the finish line with Ellison and his backers for now,” Fishman said.
For the first quarter, Paramount is expected to report a direct-to-consumer (DTC) loss of $347 million, according to Bloomberg consensus estimates.That’s narrower than the $490 million loss seen in the fourth quarter and $511 million loss in the year-earlier period.
The company previously said it expects to reach domestic Paramount+ profitability in 2025.The streamer currently boasts 67.5 million total subscribers.
Here’s what Wall Street expects, according to Bloomberg consensus estimates:
Story continues Revenue: $7.75 billion
Adj.earnings per share (EPS): $0.36
Paramount+ subscribers: 2.3 million net additions
Linear advertising revenue is expected to improve in the quarter as a result of record Super Bowl ad sales .Consensus estimates peg the segment surging 15% in the quarter from the year-earlier period following double digit declines seen in Q4.
Still, fundamentals remain weak as linear profits continue to plunge amid greater cord-cutting trends.
Streaming will also remain an unprofitable segment for at least the next year, while
Paramount has committed to various cost-efficiency plans in an attempt to stem the bleeding.These efforts have included layoffs, business restructurings , price hikes , and even a surprise dividend cut .
The company said it will take a $1 billion write-down on program and restructuring charges in the first quarter.
Management previously disclosed that around $200 million will be tied to restructuring, which suggests an $800 million charge related to content.
“These moves reflect decisions we’ve made to transition our business and enhance our future value proposition,” Paramount CFO Naveen Chopra said in February.
FILE PHOTO: Paramount is currently in exclusive merger talks with David Ellison’s Skydance Media, according to a source familiar with the matter.REUTERS/Dado Ruvic/Illustration/File Photo (Reuters / Reuters) Alexandra Canal is a Senior Reporter at Yahoo Finance.Follow her on X @allie_canal , LinkedIn, and email her at [email protected].
For the latest earnings reports and analysis, earnings whispers and expectations, and company earnings news, click here
Read the latest financial and business news from Yahoo Finance
View comments.
