Tuesday, November 6, 2012

CBS Corporation (NYSE:CBS)’s ad revenues to be watched

CBS Corporation (NYSE:CBS), which will be reporting its third quarter earnings on Wednesday after trading hours, is expected to earn 61 cents a share on revenues of $3.49 billion according to a poll by analysts.

The company's results will be watched as television ratings have been weak this season with fewer people watching its television programmes. According to analysts audience ratings have dipped 39 percent in the first five weeks of the new TV season which started off in late August and early September.

"Two and a Half Men" got a boost with Charlie Sheen being replaced by Ashton Kutcher, but its other programmes have not been so fortunate.

If television audience ratings are down it will also have an impact on advertising revenues, which is closely pegged to the viewership.

The London Olympics, which were broadcasted by rival NBC, also took away some of the viewership.

CBS has been trying to shore up its revenues by selling its older television shows to online channels and overseas markets. According to a report the company said earlier this week that it would sell shows that are no longer on air to streaming video service providers such as Hulu Plus.

The benefits of this deal will be felt only when the shows start appearing there in January.

According to an analysis, about two-thirds of CBS' revenues still come from advertising and the health of the economy and the corporate sector has a huge bearing on the ad spends by companies.

In the year-ago quarter the company had reported earnings of 50 cents on revenues of $3.37 billion.

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