: AMC Networks’ stock up 2% after profit beat offsets revenue miss

AMC Networks Inc.’s stock AMCX rose 2% premarket Friday, after the network that’s home to “The Walking Dead” franchise beat profit estimates for the second quarter by a wide margin, offsetting a revenue miss. The company had net income of $70.2 million, or $1.60 a share, for the quarter, down from $83.2 million, or $1.91 a share, in the year-earlier period. Adjusted per-share earnings came to $2.02, well ahead of the $1.53 FactSet consensus. Revenue fell to $678.6 million from $738.0 million a year ago, below the $712.0 million FactSet consensus. Revenue was weighed down by lower advertising revenue, domestic affiliate revenue and 25/7 Media production services revenue, partly offset by streaming revenue growth of 13%. The company now has 11.0 million streaming subscribers, up 6% from a year ago. Ad revenues fell 175 to $167 million due to expected linear ratings declines, a soft ad market and fewer original programming episodes in the quarter, which was partly offset by digital and advanced advertising revenue growth. The company took an impairment charge of $24.9 million to cover market challenges at 25/7 Media, its production services business, relating to reduced demand for new content and series cancellations from third parties that resulted in lower expected future cash flows. The stock has fallen 22% in the year to date, while the S&P 500 SPX has gained 17%.

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