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By Allison Prang and Benjamin Mullin 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (November 17, 2018).

Viacom Inc. said Friday it expects revenue to grow in its new fiscal year as the company augments its pay-TV business with production and licensing fees from streaming-video services.

The cable-TV giant, which owns networks MTV and Nickelodeon, and Paramount Pictures, posted a 5% rise in revenue to $3.49 billion for its fiscal fourth quarter ended Sept. 30. Analysts polled by Refinitiv were expecting $3.37 billion in revenue.

Viacom's Class B shares were up 4.5% in afternoon trading in New York.

The company's core cable business has declined in recent years as younger viewers cancel their subscriptions and opt for video-streaming platforms owned by Netflix Inc., Amazon.com Inc. and Alphabet Inc.'s Google. The company has adapted to the so-called cord-cutting in part by selling programming to those online players amid growing demand for content.

In an earnings call, Viacom Chief Executive Bob Bakish drew a distinction between the company's current strategy of producing original content for streaming services and a previous approach of licensing the company's existing library to rivals like Netflix, which some analysts believe hastened the migration of viewers away from cable networks.

"Viacom has all the pieces to become a pre-eminent creator of multiplatform content for the world," Mr. Bakish said.

Jim Gianopulos, who heads Viacom's Paramount Pictures, said the studio had reached a multipicture deal with Netflix, part of the company's plan to forge additional partnerships with streaming services.

Viacom reported a fourth-quarter profit of $394 million, or 98 cents a share, down 42% from the year-earlier tally, which included a $127 million gain from the sale of broadcast spectrum. In addition, the latest period included an $111 million income-tax expense, compared with a $124 million benefit a year earlier.

The New York-based company said domestic affiliate revenue grew 3%, a sign of resiliency for its core cable business amid the industrywide slump triggered by cord-cutting. Although advertising declined 6% from a year earlier to $1.14 billion, the company said it expects domestic ad revenue to return to growth in the second half of 2019.

Another bright spot for Viacom was growth at Paramount Pictures, which has undergone a financial turnaround since 2016, when it lost $445 million. The company said double-digit revenue growth helped propel the film studio to profitability for a third consecutive quarter, buoyed by the success of "Mission: Impossible -- Fallout" and "A Quiet Place."

Write to Allison Prang at allison.prang@wsj.com and Benjamin Mullin at Benjamin.Mullin@wsj.com

(END) Dow Jones Newswires

November 17, 2018 02:47 ET (07:47 GMT)

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