Paramount Global, the parent of CBS, MTV and its namesake Hollywood movie studio, reported third-quarter sales that missed analysts’ estimates, overshadowing big gains in streaming subscribers.

Overall revenue dropped 6% at Paramount to $6.73 billion in the three months ended Sept. 30, missing analysts’ forecasts of $6.95 billion. Adjusted earnings per share from continuing operations were 49 cents, the New York-based media giant said in a statement on Friday. That surpassed Wall Street’s estimates of 23 cents.

Also read: Ad spending stats on Paramount Global

Like other traditional media companies, Paramount is focusing on its streaming business to boost growth as customers move away from traditional television, taking advertising dollars with them. Despite hits like the animated Sonic the Hedgehog franchise, Paramount has said it’s looking for a joint-venture partner in streaming to better compete with market leaders Netflix Inc. and Walt Disney Co. On Wednesday, Warner Bros. Discovery Inc. posted surprising strength in adding new subscribers to its streaming unit, home to Max. The company’s shares rose 12% on the news. 

In Paramount’s direct-to-consumer division, which includes Paramount+ and the ad-supported Pluto TV streaming service, revenue increased 10% to $1.86 billion in the third quarter, the company said. Paramount+ added 3.5 million subscribers in the quarter, driven by sports such as the NFL and UEFA and original programming like “Tulsa Kings,” beating the 2.37 million analysts were expecting. The service now has a total of 72 million subscribers. It was the second quarter of profitability for the unit, with $49 million in operating income before depreciation and amortization. 

The shares rose less than 1% in premarket trading in New York.

Paramount is working to close its merger with Skydance Media in the first half of 2025. Chair Shari Redstone will leave the board after the merger is completed and Skydance founder David Ellison, son of Oracle Corp. co-founder Larry Ellison, will take over as chair and CEO.

Paramount was in talks with Warner Bros. about a merger for months before giving up when no concrete offer was received, a regulatory filing disclosed earlier this week. The company held talks with at least 12 alternative bidders before cutting a deal with Skydance.

In the TV media unit, the company’s biggest, which includes CBS, Nickelodeon, MTV and other channels, revenue decreased 6% to $4.3 billion, driven by driven by lower advertising revenue and fewer subscribers to cable TV. In the second quarter, the company took an impairment charge of $5.98 billion on its cable networks to account for declining profit projections. Warner Bros. also previously announced a $9.1 billion writedown on its cable networks, which include CNN and TNT.

Paramount’s filmed entertainment unit saw revenue decrease 34% to $590 million, dragged down by a 71% decrease in theatrical revenue, due to the number and timing of releases compared with a year earlier. Paramount Pictures’ biggest new releases in the quarter were A Quiet Place: Day One and Transformers One.

Paramount is also in the midst of a $500 million cost-cutting effort that will lead to the elimination of about 2,000 jobs or 15% of its U.S. workforce.

—Bloomberg News