Paramount CEO: Delaying Big Movies During the Pandemic “Proved to Be the Right Call”
Paramount Global is feeling bullish about its ability to make hit content after a string of recent successes at the box office, including Top Gun: Maverick, and on the Paramount+ streaming service, such as Halo, management said during the company’s second-quarter earnings conference call on Thursday.
“Nowhere is our popularity more evident than at the box office,” president and CEO Bob Bakish told analysts. “Look no further than Top Gun: Maverick, which is already the biggest film was 2022 and our fifth No. 1 title this year. In fact, Top Gun: Maverick just cleared $1.3 billion at the global box office and became one of the top 10 domestic movies of all time. Here we leveraged our portfolio brands, including CBS and MTV, to execute a major company consumer campaign that resonated with audiences everywhere, a strategy that has proven to be highly effective when deployed against our major assets.”
He also touted the company’s four other No. 1 films at the 2022 box office, namely Jackass Forever, Scream, The Lost City and Sonic the Hedgehog 2, saying their success wasn’t a given, but required “the right strategy and strong execution” by the company. “In the early stages of the pandemic, we were very selective with our releases, holding certain films until market conditions improved. While we couldn’t release Top Gun: Maverick and The Lost City earlier, we held off because we knew these phenomenal stories would bring audiences back to theaters. That proved to be the right call. Paramount continues to shine at the box office with numbers that outperformed even our own expectations. And we’re excited about the future. We will end this spectacular year with Damien Chazelle’s Babylon, starring Brad Pitt and Margot Robbie, which begins his theatrical rollout in December.”
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The Paramount CEO also touted the studio’s 2023 slate, “anchored by fresh commercial takes on some of our most popular and new franchises, from Transformers and Teenage Mutant Ninja Turtles to Dungeons and Dragons and Paw Patrol, to name just a few.”
Bakish also lauded the success of such originals as Halo for driving Paramount+ and its user gains. “Viewers hungry for incredible storytelling are also turning up in ever greater numbers to our flagship streaming service,” he said. “The diversity and quality of our content is unrivaled, especially on Paramount+.”
The executive then pointed to data suggesting the streamer’s appeal. “Paramount+ is the No. 1 premium service in the U.S. in signups and net subscriber additions, both this quarter and year to date. And based on other third-party data, Paramount+ is also the most popular premium streaming service in the U.S. to add among switchers. That means people who dropped a service in the last 12 months are more likely to add Paramount+ than any other service, yet again evidence we are taking market share.”
Overall, Bakish argued: “Our content consistently attracts and entertains mass audiences. When I say audiences, I don’t just mean kids or adults, I mean the whole household, not just the coasts, but the entire country, not just the U.S., but the entire world, not just the streaming audience, but the TV, theatrical and streaming audience. Part of the reason is that we don’t just make popular content, we also make content popular by leveraging our powerful platforms.”
Also on Thursday’s call, Paramount CFO Naveen Chopra reiterated the goal of getting to spending $6 billion on streaming content in 2024, with streaming losses to peak in 2023. With streaming revenue and subscriber count growing, “our content investment is working,” he argued.
Asked if Paramount+ could over time raise its subscription prices, something Netflix has consistently done, despite high inflation. “Pricing will be a part of the equation. And though we don’t have any imminent price changes, they will happen in the future,” he replied. “We will do it while also taking into account the evolution of our content offerings, looking at what sort of bundles and other promotional opportunities are available to our customers, and, of course, thinking about our value proposition relative to competing services where I point out I think we we offer a very strong value position today.”
And Bakish got a question about a big recent cricket rights deal struck by Paramount joint venture Viacom18 in India, which makes it the new online home of Indian Premier League cricket for the next five years, while Disney’s Star India will remain the sports broadcaster on TV. “That’s a deal that was done by our joint venture in India … which recently had a transaction where they brought in Bodhi Tree [the investment company backed by James Murdoch and Uday Shankar] as an investor and capital infusion,” Bakish said.
The exec added: “And I’m going to leave it to the joint venture. But what they have said is the streaming rights there can be part of a streaming offering for the Indian market, that [the] team is going to launch in 2023. We have also said that Paramount+ is going to launch with it, essentially, as another form of our bundling tier.”
