Release Date: May 09, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- AMC Networks Inc (AMCX, Financial) generated $94 million in free cash flow in the first quarter, indicating a strong start towards their goal of $220 million for the year.
- The company launched an ad-supported version of AMC+ with Charter, expanding access and flexibility for subscribers.
- AMC Networks Inc (AMCX) is seeing strong interest in its new AMCN outcomes attribution product, enhancing advertising capabilities.
- The series 'Dark Winds' returned for a third season with a premiere night audience of approximately 2.2 million viewers and a 100% score on Rotten Tomatoes.
- AMC Networks Inc (AMCX) is expanding its content offerings with new series and franchises, including 'Talamasca: The Secret Order' and 'Great American Stories'.
Negative Points
- Consolidated net revenue declined 7% year over year to $555 million, with a 30% decline in consolidated AOI.
- Domestic operations revenue decreased 7%, with a 12% decline in affiliate revenue impacting subscription revenue.
- Advertising revenue decreased 15% year over year, primarily due to lower linear ratings.
- International revenue decreased 7%, with subscription revenue down 12% due to the non-renewal with Movistar in Spain.
- Streaming subscribers declined slightly from 10.4 million at the end of 2024 to 10.2 million, reflecting a focus on higher quality subscribers.
Q & A Highlights
Q: Can you tell us more about the streaming subscribers coming in through bundled video packages and any risk of cannibalization on the a-la-carte side?
A: Kristin Dolan, CEO, explained that AMC Networks is pleased with the integration with Charter and Philo, tracking as expected. Patrick O'Connell, CFO, added that AMC Networks is taking a partner approach to distribution, which they believe will create a healthier video ecosystem and present additional revenue opportunities through upselling and increased engagement.
Q: What are your expectations for the advertising market given macroeconomic concerns?
A: Patrick O'Connell, CFO, noted that while the linear market remains challenged, AMC Networks is encouraged by the strength of its programming and digital advertising capabilities. Kim Kelleher, Chief Commercial Officer, added that AMC Networks is confident in its premium content and advanced advertising capabilities, which continue to deliver unique value to advertising customers.
Q: How much of your advertising revenue is coming from streaming, and what is the impact of the Movistar subscription revenue drop in Spain?
A: Kim Kelleher, Chief Commercial Officer, stated that streaming advertising delivers incremental revenue and offers sponsorship opportunities. Kristin Dolan, CEO, mentioned that AMC Networks anticipated the Movistar change and has plans to offset the revenue impact, with growth in other Spanish market partnerships.
Q: Can you discuss the seasonality and revenue expectations for the rest of the year?
A: Patrick O'Connell, CFO, indicated that revenue acceleration is expected from streaming price increases and content licensing deals. The free cash flow generation is front-loaded due to production schedules, and content licensing revenue will rebound over the year.
Q: What are your expectations for content spend and amortization this year?
A: Patrick O'Connell, CFO, stated that content amortization and cash content spend are expected to be slightly lower year-over-year, with the volume of productions remaining flat. Kristin Dolan, CEO, emphasized the focus on maintaining high-quality content at reasonable costs.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
