In a recent development, Bob Bakish, CEO of Paramount Global, has announced his resignation. The exit comes in the aftermath of ongoing merger discussions with Skydance Media. Bakish, who has been with Viacom since 1997, took up the leadership post in 2016 and retained his position during the Viacom-CBS merger in 2019. As part of this change, he will also depart from the company’s board of directors.
Instead of replacing Bakish with another individual, Paramount is introducing an “Office of the CEO”, co-led by George Cheeks, CBS president and CEO; Chris McCarthy, president and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, the head of Paramount Pictures and Nickelodeon. The company expressed faith in their new leadership’s ability to develop a long-term plan for accelerating growth, streamlining operations, developing popular content, strengthening the balance sheet, and augmenting the streaming strategy.
While the news of Bakish’s departure sends ripples across the business ecosystem, the company also disclosed its first-quarter earnings. Paramount yielded $7.69 billion in revenue, narrowly missing the projected $7.73 billion. However, the company had an earnings beat at 62 cents per share against the estimated 36 cents.
Highlighted in the earnings call was the 6% increase in overall revenue year-on-year. This was primarily due to income generated from the Super Bowl and streaming operations. Paramount’s content streaming segment, which includes Paramount+, Pluto TV, and BET+, witnessed a 24% increase in revenue, reaching nearly $1.88 billion.
While the streaming segment contributed to the company’s growth, the TV media unit saw a marginal increase of 1% to $5.23 billion. This was stimulated by Super Bowl advertising revenue, even in the face of a generally lackluster advertising environment for traditional TV networks.
Parameter also divulged its addition of 3.7 million new subscribers to Paramount+ in the quarter, tallying the total to 71 million. The streaming related losses narrowed down to $286 million against last year’s $511 million losses.
However, amid the company’s ongoing discussions about a merger with Skydance Media, Bakish’s exit marks a significant turn. His objections to the merger were reportedly due to fears of common shareholders’ dilulation. The proposed deal would see approximately half of the merged entity owned by Skydance and its private equity backers, while the remaining would be publicly traded shares of Paramount.
Relevant to note is the timing of this announcement, as Paramount is also in talks with Charter Communications over the transmission of its TV networks including CBS and MTV. An exclusive committee is inspecting the transactions of the merger and the valuation of Skydance’s assets. If the merger concludes, Skydance plans to appoint its CEO, David Ellison, as the head of Paramount.
