Good Start to 2018 for CBS

Overall revenue grew 13% year over year to $3.3 billion. Ad revenue improved by 8% due largely to the acquisition of Channel Ten in Australia. Despite competing against the Winter Olympics, ad revenue at the broadcast network was up 1% versus the same period last year. Affiliate and subscription fees for the entertainment segment grew 16% year over year driven by retrans and reverse comp growth along with growth in All Access subscriptions and third-party live streaming. CBS will have all of its retrans and reverse comp deals up for renewal over the next three years, providing the firm with the ability to meet its stated 2020 revenue goal of $2.5 billion for this revenue source. Content licensing and distribution grew by 18%, highlighting the return from the continued investment in the studio business. Adjusted operating margin fell to 20.8% versus 21.7% a year ago as revenue growth in high margin areas such as retrans and reverse comp were more than offset by increased content costs at both CBS and Showtime.

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