AMC Networks, the cable network and streaming company that operates companies like AMC, AMC+, IFC, BBC America, Acorn TV and Shudder, reported a 5 percent drop in U.S. ad revenue in the second quarter but said it’s streaming subscribers in the period to the end of June with 10.8 million, an increase from 9.5 million at the end of March and higher than forecast.
Earlier this year, it predicted it would add 400,000-500,000 streaming subscribers in the second quarter. Early Friday, the company said the better-than-expected growth was “driven by the launch of AMC+ premium streaming bundles in Spain and a strong content offering.”
AMC’s streaming strategy is focused on AMC+ and niche services, which they say have lower content costs than broad entertainment services, but attract loyal subscribers. In May, the company announced plans to increase the prices of its AcornTV and ALLBLK streaming services by $1.
One of the company’s most significant content launches in the second quarter was the final season of You better call Saul and the second half of season 7 of Fear the walking dead.
US ad revenue fell to $202 million amid “lower linear ratings,” partially offset by higher “AMC Originals impressions, pricing and digital growth.”
AMC Networks’ second-quarter total revenue declined 4 percent to $738 million despite a 20 percent gain in streaming revenue, or 36 percent on a normalized basis, more than offset by “various timing effects in the quarter, including projected lower affiliation, content licensing and advertising revenue, and unfavorable foreign exchange translations.”
Quarterly operating income increased 125 percent to $153 million after including impairment charges and other charges of $143 million in the prior year quarter “related to a one-time litigation settlement payment.” However, adjusted operating income declined 22 percent to $196 million “due to the timing of increased content and marketing investments to drive subscriber and streaming revenue growth.”
AMC is led by interim CEO Matt Blank, but the company said early Friday that current COO and CFO Christina Spade will take over the CEO role in early September.
“AMC Networks delivered a solid second quarter, benefiting from strong subscriber growth for our differentiated streaming services as we execute on our strategy to super-serve passionate audiences with a curated, targeted content experience,” said Blank. “As we leverage our strong linear business, we see increasing demand for our digital and advanced advertising capabilities. And our content creation strengths were fully demonstrated this quarter, with ratings, widespread critical acclaim for new and returning series, including for You better call Saul and dark winds, and Emmy Award nominations in major categories. We are building our business in a steady, disciplined and sustainable manner, positioning ourselves for future growth and delivering shareholder value.”