Time Warner on Wednesday reported better-than-expected quarterly earnings, getting a boost from the box-office success of “Wonder Woman” and cable subscriber growth.
The media conglomerate, which is awaiting government approval for its $85 billion sale to AT&T, posted net income of $1.06 billion in the second quarter, up 11.6% from the same period last year. Revenues grew 5% to $7.3 billion, even as operating income decreased 8% to $1.7 billion.
Adjusted earnings of $1.33 a share easily beat the $1.19 consensus prediction.
Revenue at Warner Bros. increased 12% to $3 billion, reflecting the high-flying performance of “Wonder Woman,” which has so far grossed more than $800 million worldwide. The home video release of “The Lego Batman Movie” also helped the studio’s results but operating income fell 28% to $223 million due to higher film and advertising costs.
At the Home Box Office division, revenue was up 1% to $1.5 billion, while subscription sales rose 8% due to higher fees and international growth. HBO, the channel behind “Game of Thrones,” experienced declines in home entertainment and international licensing revenues.
“Our performance is a result of the continued successful execution of our strategic objectives – with the strong Subscription revenue growth at Home Box Office and Turner a great example of this – along with the investments we’re making in our brands and high-quality video content,” Time Warner CEO Jeff Bewkes said in a news release.
“Accelerating our pace of innovation and being able to connect more directly with consumers are among the exciting reasons for our proposed merger with AT&T, which remains on track to close before year end,” he added.
At the company’s largest unit, Turner Broadcasting, revenue grew 3% to $3.1 billion, due to higher affiliate fees and international growth. CNN posted a strong quarter in the ratings, but advertising revenue for the entire cable network group was down 6%.
“The White House’s hyper-metabolic approach to news cycles resulted in big ratings for CNN,” Variety noted.