After the major incorporation of Showtime into Paramount+ 2 weeks ago, Paramount revealed its quarterly profits this day. The company announced that Paramount+ acquired 9.9 million users in Q4 to bring the total number of subscribers to 56 million, an increase from the previous quarter's total of 46 million subscribers. This indicates that Paramount+ has a larger subscriber base than Hulu, which only recently announced that it had 48 million members. The corporation also acknowledged that, due to its acquisition of Showtime, it plans to increase pricing across the board for its services.
Analysts have projected a net increase of 10 million members. The number of direct-to-consumer (DTC) subscriptions for Paramount+, Showtime, BET+, and Noggin was increased by 10.8 million, bringing the total number of subscribers served by the firm to 77 million.
On its earnings call, Paramount disclosed that beginning in the first quarter of 2023, it will no longer announce the total aggregate number of DTC customers.
Every month, the number of people using Pluto TV, a free streaming service offered by Paramount and financed by advertisements, increased, bringing the total to 78.5 million. Tubi's main competitor, however, only has 64 million active members every month.
The revelation made by the streamer that it will be incorporating Showtime into its platform later this year was the most major piece of news that the streamer shared during the quarter. The proposed "Paramount+ with Showtime" service will fight head-to-head with the forthcoming "HBO Max/Discovery+" service from Warner Bros. Discovery.
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What Does Showtime Bring To The Table?
Due to the addition of Showtime programming, the firm revealed during the earnings call that it will be boosting the price of its Paramount+ Premium category from $9.99 per month to $11.99 per month. The Essential tier will now cost $5.99 a month rather than the previous $4.99, and it will no longer include Showtime. When Paramount+ with Showtime starts at the beginning of the third quarter of 2023, pricing will shift for existing and new consumers.
As CEO Bob Bakish revealed the intentions to hike prices in December, customers anticipated that there would be a price rise.
The company has warned investors that it anticipates a reduction in total subscribers in the first quarter of 2023 due to the consolidation. This is because the subscriber base for Showtime consists of subscribers who either use the Paramount+ and Showtime pack, which was introduced last summer, or subscription to both streaming platforms independently.
In addition, the business said that its losses from streaming services increased to $575 million, up from $502 million in the previous quarter. Meanwhile, money generated from direct sales to consumers climbed by 30% yearly, while revenue generated via subscriptions increased by 48% year over year. The increase in revenue for Paramount+ was 81% compared to the previous year.
Bakish said in his letter to shareholders, "Our content and platform plan is working, and with even more excellent content arriving this year, we anticipate restoring the firm to profit growth in 2024."
Top Releases Contributing To Paramount’s Success
According to the company, the expansion in the number of subscribers to Paramount+ was attributed primarily to the service's content slate. This includes the release of "Top Gun: Maverick" on the service on December 22nd, as well as the National Football League games and new releases such as "Tulsa King," featuring Sylvester Stallone, and also the horror film "Smile."
Featured image: Paramount
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