AMC Networks Q1 Earnings Report 2024: Advertising, Streaming Updates

By Chanak Maduranga

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AMC Networks Q1 Earnings Report 2024: Advertising, Streaming Updates

AMC Networks — the company behind such cable channel brands as AMC, IFC and Sundance TV, as well as such streaming services as AMC+, Acorn TV and Shudder — reported a 13 percent drop in first-quarter U.S. advertising revenue Friday, following a 23 percent decline in the fourth quarter of 2023.

After returning to streaming subscriber growth in the third quarter of last year after two quarters of declines, the company added 100,000 users in the first quarter to end March with a total of 11.5 million subs, compared with 11.4 million as of the end of the year and 11.2 million as of the end of March 2023.

Quarterly streaming revenues increased 3 percent to $145 million, “primarily driven by year-over-year subscriber growth and price increases,” AMC Networks said. Affiliate revenue fell 14 percent, “primarily due to basic subscriber declines.” Content licensing revenues declined 40 percent to $62 million as the year-ago period included deliveries of Silo, an AMC Studios-produced series. Excluding Silo, content licensing revenues rose 31 percent.

Ad revenue decreased to $140 million in the first quarter, in which AMC aired such original series as The Walking Dead: The Ones Who Live, starring Andrew Lincoln and Danai Gurira, “due to linear ratings declines and a challenging ad market, partly offset by digital and advanced advertising revenue growth,” AMC Networks said.

The company, led by CEO Kristin Dolan, has been leaning into data-led audience targeting for ad buying as marketing dollars continue to shift from linear TV networks to ad tiers being rolled out by streaming platforms. “It’s a huge opportunity to finally swing the pendulum back from digital-first to shared purchase of traditional television as well as digital to support the advertiser efforts,” Dolan said earlier this year.

First-quarter total revenue at AMC Networks fell 17 percent, or 6 percent when excluding onetime year-ago factors, to $596 million. Operating income dropped 36 percent to $110 million and adjusted operating income fell 31 percent to $149 million

Restructuring initiatives cost the company $4.8 million in the latest period, including “cash payments of $1.3 million for content impairments and other exit costs and $3.5 million for severance and employee-related costs.” The year-ago figure had amounted to $56.9 million, including “cash payments of $41.0 million for content impairments and other exit costs and $15.9 million for severance and employee-related costs.”

Dolan succeeded Christina Spade in early 2023 after a cost-cutting program, including layoffs, was unveiled in late 2022. 

Friday’s earnings update also highlighted recent streaming moves by AMC Networks. Among them is a plan to roll out stand-alone ad-supported versions of the firm’s streaming services Acorn TV, Shudder, ALLBLK and HiDive in 2025 and the launch of AMC Stories and AMC Reality in the U.K. on ad-supported streamer ITVX.

On a morning analyst call, Dolan stressed AMC as new technologies increasingly change how media content is viewed has focused on producing premium content made available to viewers whenever and wherever they want to watch. “As we continue to focus on building our brands, expanding our partner relationships and serving viewers, we’re very confident in our ability to weather the changes that are happening in what remains a dynamic operating environment,” she told investors.

Asked about cord-cutting, Dolan argued AMC was “agnostic” regarding platforms through which its content is delivered, whether as part of traditional cable bundles or on new streaming platforms. But she endorsed skinny bundles “as more distributors focus on that opportunity” and add channels from her company.

Dolan also welcomed bundling by studio rivals increasingly dominating the wider TV streaming space to sign up and retain customers, as with the recently proposed triple-play packaging and marketing of Disney+, Hulu and Max. “We see a great opportunity in bundles… We’re excited to hear about the Disney+, Hulu, Max bundle. In an odd way it is sort of recreating family cable and putting all the entertainment products together,” she explained.

Dolan added the streaming platform Max featuring content from AMC Networks in summer 2023 helped her company understand how the AMC brand could work inside of a package subscribers can take up. “So we expect to see more streaming bundles. We are more than happy to participate in them and we have quite a few conversations going on right now that we hope to share insights on going forward,” she said.

Chanak Maduranga

passionate journalist behind 'USA News Now 24', dedicated to delivering timely and accurate updates on US affairs. Committed to journalistic integrity and informing audiences with credible news coverage.

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