AMC Networks reported its third-quarter 2024 financial results, revealing both challenges and strategic advancements across the business. The company recorded net revenues of $600 million, marking a 6% decline year-over-year. Adjusting for the previous year’s revenues related to 25/7 Media (sold in December 2023), the decrease was 3%. Operating income dropped by 22.5% to $94 million, while adjusted operating income fell by 25.8% to $131 million, yielding a 22% margin. Free cash flow reached $54 million, contributing to $293 million year-to-date. Additionally, diluted earnings per share (EPS) came in at $0.76, with adjusted EPS at $0.91.
Chief Executive Officer, Kristin Dolan, said: "As we manage this business within a complex and changing environment, we remain focused on our key strategic pillars - programming, partnerships and profitability. During the quarter, we made significant advancements across all three areas. We have generated $293 million of free cash flow year to date and are well on our way to delivering our stated goal of approximately half a billion dollars in cumulative free cash over two years. We also entered into new and enhanced partnerships with major companies like Charter, Netflix, Amazon and others which are driving our company forward as we continue to provide distinctive, high-quality programming to customers across an expanding array of platforms."
Domestic operations revenue decreased 2% to $530 million. Subscription revenue declined 5% to $316 million due to a reduction in linear TV subscribers, offset somewhat by streaming gains. Streaming revenue grew 7% to $152 million, with AMC Networks' subscriber count rising by 5% to 11.8 million. Content licensing saw a 31% boost to $81 million, spurred by AMC’s partnership with Netflix. Advertising revenue, however, dropped 10% due to linear viewership declines, partially compensated by digital growth.
International revenues fell 24% to $74 million, partly due to the prior year's inclusion of 25/7 Media. Adjusted for this divestiture, international revenue decreased by 6%. Subscription revenue declined by 14%, influenced by a terminated distribution agreement in the U.K., while content licensing dropped 88%. Advertising revenue, however, grew 16% due to new streaming products in the U.K. and European market gains. Adjusted operating income for international segments rose 4% to $14 million.
AMC Networks renewed its agreement with Charter Communications, incorporating AMC+ as an ad-supported service for Charter customers. Additionally, it launched prior seasons of 13 shows on Netflix under "The AMC Collection," which has shown strong initial performance. AMC also expanded its presence on Amazon platforms with 15 new FAST channels, and entered a content-sharing arrangement with MGM+.
AMC completed its acquisition of BBC America, assuming full operational control. This transaction reduces future cash distributions to non-controlling interests and programming commitments. The company also reduced its debt load by repaying $8.1 million and making an additional voluntary $35 million prepayment under its Term Loan A Facility.
AMC Networks continues to focus on bolstering its content library and exploring innovative ways to expand viewership while navigating a complex advertising landscape. The company's strategic partnerships, content licensing agreements, and increased streaming revenue position it for potential resilience in a challenging market environment.
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