Paramount Earnings: Success With Streaming Subscribers and Costs Highlight Strong Results

Paramount’s direct-to-consumer streaming business underpinned the firm’s excellent third-quarter sales and profits, and it buoyed market enthusiasm for the segment. Most important, management now expects that peak DTC operating losses, which have heavily weighed on firmwide margins, occurred in 2022 and will continue improving from here. It’s much too early to declare success for Paramount’s streaming business, but we believe the cloud that has been overshadowing the firm’s value is starting to lift. We’re maintaining our $25 fair value estimate and think the stock is undervalued.