Shareholders looking for proof the merger is paying off will welcome this: Paramount Skydance raised its full-year adjusted EBITDA guidance to $3.8 billion to $3.9 billion, citing faster-than-expected streaming growth and merger-related cost savings. The company made the revision with second-quarter results for the period ended June 30, 2026, reporting revenue of $6.91 billion versus an LSEG consensus of $6.88 billion and keeping a full-year revenue target of $30 billion. Streaming and studio strength underpinned the upgrade even as traditional TV continued to weaken, with direct-to-consumer revenue up 9% to $2.47 billion and Paramount+ adding 2 million net subscribers to 81.6 million globally. Management also reiterated confidence in its proposed acquisition of Warner Bros. Discovery.

The market consequence is clear: improved cash generation expectations, driven by subscribers and cost synergies, have nudged the company's profit outlook higher. Paramount Skydance raised its adjusted EBITDA guide to $3.8 billion to $3.9 billion and left its full-year revenue target unchanged at $30 billion, implying roughly 4% year-on-year growth for 2026.

The second-quarter numbers supplied the justification. Revenue for the three months to June 30 was $6.91 billion, a touch above the LSEG consensus of $6.88 billion. Reported net earnings attributable to shareholders fell to $41 million, or 4 cents per share, down from $57 million, or 8 cents, a year earlier. The company noted that reported EPS isn't directly comparable with LSEG adjusted-per-share estimates.

Streaming was the engine. Direct-to-consumer revenue, which covers Paramount+, BET+ and Pluto TV, rose 9% to $2.47 billion. Paramount+ added 2 million net subscribers in the quarter to reach 81.6 million globally, and management pointed to better retention and higher average revenue per user as contributors to that growth.

Film studio revenue also strengthened, increasing 16% to $1.31 billion and swinging the studios to an operating profit for the period.

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But linear TV remains a drag. TV media revenue fell 9% to $3.13 billion as the cable networks and the traditional pay-TV market continued to face pressure. That divergence between streaming momentum and legacy TV weakness helps explain why management emphasised both subscriber gains and price and mix as drivers of the quarter's upside.

Cost savings from consolidation are doing heavy lifting on the profit line. Paramount Skydance said last year’s consolidation is producing integration savings and early technical benefits between Paramount+ and Pluto TV, and the company reaffirmed a target of roughly $3 billion in synergies from the merger. Management told investors it's investing in storytelling and scaling the direct-to-consumer business while driving enterprise efficiency, with Chairman and Chief Executive David Ellison describing progress against those priorities on the earnings call.

Studio strategy also fed the beat. The company increased its planned theatrical slate for 2026 from eight films to 15, a change management said supported the studios' revenue improvement. For the third quarter key expects revenue of $6.95 billion to $7.15 billion and warned Paramount+ subscriber additions are likely to be broadly flat quarter over quarter.

On the deal front, management reiterated confidence in the proposed acquisition of Warner Bros. Discovery despite an antitrust lawsuit brought by a group of U.S. states. The company has agreed to extend the deal closing deadline to as late as June 2027. The transaction has cleared the Justice Department’s antitrust division and regulators in several other jurisdictions, including Europe, but the plaintiff states have scheduled the trial for March 2027.

The results were disclosed in the company’s earnings release and public comments in early August 2026, and they present a simple read: streaming scale plus merger savings are elevating profit expectations even as legacy TV declines. That combination is reshaping how investors value the business and how regulators and rivals will judge major studio consolidation going forward.

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The next concrete milestone for the deal is the antitrust trial scheduled for March 2027, and the company has extended the merger closing window to at least June 2027. Originally reported by aa.com.tr.

This article was created with AI assistance.