Paramount Global to Post Q1 Earnings: What's in Store for the Stock?

Paramount Global PARA is scheduled to report its first-quarter 2025 results on May 8.

The Zacks Consensus Estimate for PARA’s first-quarter 2025 revenues is currently pegged at $7.1 billion, indicating a 7.56% decrease from the year-ago quarter’s reported figure.

The consensus mark for earnings is pinned at 30 cents per share, which has been revised downward by 21.05% over the past 30 days. The figure suggests a 51.61% decrease from the year-ago reported figure.

PARA surpassed the Zacks Consensus Estimate for earnings in three of the trailing four quarters and missed once, with a positive average surprise of 65.56%.

Paramount Global Price and EPS Surprise

Paramount Global price-eps-surprise | Paramount Global Quote

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Let us see how things are shaping up for the upcoming announcement.

Factors to Consider 

Paramount Global is expected to have continued its content momentum on Paramount+ in the first quarter of 2025, with the return of some highly anticipated shows, including season 3 of Yellowjackets and season 2 of Yellowstone’s 1923, which was the most-watched original premiere in Paramount+ history. Toward the end of the quarter, the company premiered two new series, MobLand and Happy Face.

PARA added 5.6 million new subscribers on Paramount+ in the fourth quarter of 2024. Subscriber growth is expected to have continued in the quarter under review, though not at the same level as the prior quarter, given the timing of content releases. Paramount+ ARPU is expected to have accelerated in the first quarter as the company fully laps the price increases introduced in 2023. Additionally, fourth-quarter subscriber additions are expected to have impacted the top line positively in the first quarter.

In TV Media, affiliate revenues declined 6.7% year over year in the fourth quarter. The rate of decline is expected to have increased in the first quarter due to the impact of the company’s recent renewals and an evolving pay TV ecosystem. Advertising revenues also declined 4% year over year in the prior quarter, and similar trends are likely to have continued in the quarter under review. The Super Bowl was a meaningful contributor to the fourth quarter, which poses as a headwind for advertising revenues in both TV Media and the D2C segment in the quarter to be reported. 

Adjusted OIBDA is expected to have declined in the quarter, reflecting the business trends mentioned above and the comparison against the Super Bowl, which significantly benefited 2024. Another important factor impacting the performance in the first quarter is the cumulative impact of the company’s renewals with some of its largest distributors. PARA signed a number of these deals since the end of the first quarter of 2024.

What Our Model Says for PARA

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not exactly the case here.

PARA currently has an Earnings ESP of -24.85% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Stocks to Consider

Here are some other companies worth considering, as our model shows that these also have the right combination of elements to beat earnings in their upcoming releases:

Affirm AFRM currently has an Earnings ESP of +63.27% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

AFRM shares have plunged 14.5% in the year-to-date (YTD) period. It is slated to report its third-quarter fiscal 2025 results on May 8.

Birkenstock Holding PLC BIRK has an Earnings ESP of +6.00% and a Zacks Rank #2 at present.

BIRK shares have lost 7.2% YTD. IT is scheduled to report its second-quarter fiscal 2025 results on May 15.

Fox FOXA has an Earnings ESP of +3.78% and sports a Zacks Rank #1 at present.

FOXA shares have gained 1.4% YTD. Fox is scheduled to report its third-quarter fiscal 2025 results on May 12.

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This article originally published on Zacks Investment Research (zacks.com).

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