Paramount gets lift from ‘Top Gun’ but streaming losses a drag

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Aug 4 (Reuters) – Paramount Global  beat Wall Street expectations for quarterly revenue and profit on Thursday, powered by the May release of blockbuster Tom Cruise-starrer “Top Gun: Maverick” even as streaming subscriber growth slowed.

The sequel to the 1986 action flick “Top Gun” surged past Disney’s Marvel adventure “Doctor Strange in the Multiverse of Madness” as the highest-grossing movie of the year, bringing Paramount much needed relief in its film unit that has been struggling since the pandemic outbreak.

The film, which crossed $1 billion in global box office sales, also surpassed “Titanic” to become the company’s No. 1 domestic grossing film of all time.

“Maverick” drove a 126% jump in revenue at Paramount’s filmed entertainment business in the second quarter ended June.

Still, shares of the media giant slipped 1.4% before the bell on widening losses in its streaming business.

Losses in its direct-to-consumer segment ballooned to $445 million, from $143 million a year earlier.

Paramount said global streaming subscribers rose to about 64 million. Paramount+, its flagship streaming platform, added 4.9 million subscribers.

The company, formerly known as ViacomCBS, said it removed about 3.9 million subscribers related to its Russia exit.

Paramount earned 64 cents per share on revenue of $7.78 billion, above analysts’ estimates of 61 cents profit on revenue of $7.57 billion, according to Refinitiv data.

Operating income fell to $819 million, from $1.23 billion a year earlier, largely due to investments to bolster original content.

(Reporting by Eva Mathews in Bengaluru; Editing by Sriraj Kalluvila)

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