Paramount Global has taken a $5.98 billion write-down on its linear cable TV business, reflecting the decline in revenue and the impending acquisition by Skydance Media. This write-down will lead to a second-quarter 2024 net loss of $5.4 billion, a significant increase from the $299 million loss reported in the same quarter of 2023.
The write-down is another indicator that media companies are grappling with the transition to streaming as consumers increasingly opt for streaming services and social video platforms over traditional cable TV packages. This shift is causing a decline in revenue for traditional cable TV businesses.
Paramount's overall revenue also experienced a 11% drop to $6.8 billion. However, there were some positive developments. Direct-to-consumer revenue saw a 13% increase to $1.9 billion, with advertising revenue in this category climbing 16% to $513 million. Paramount+, the company's streaming service, experienced a 46% revenue growth, reaching $1.36 billion.
Despite the positive growth in streaming, Paramount+ lost 2.8 million subscribers due to the termination of a bundle partnership in the South Korean market. As a result, the platform ended the quarter with 68 million global subscribers.
Paramount is currently undergoing an acquisition by Skydance Media. This deal is expected to assist the company in addressing its substantial debt burden and implementing cost reduction measures.