The small screen played a big role in MGM Studios’ second-quarter earnings, as a 164 percent rise in television licensing revenue helped make up for a film slate that fell short of last year’s pace.
MGM’s total revenue of $271.6 million for the three months ended June 30 was actually down slightly from the same time last year, when the studio earned $274.3 million. Net income was down 22 percent to $29.1 million, but adjusted EBITDA, which backs out non-operational expenses like interest and taxes, was up 1 percent to $91.5 million. MGM has achieved record adjusted EBITDA for three consecutive years.
TV carried an outsize load, as licensing revenue came in at $55.3 million for the quarter, a $34.4 million or 164 percent increase over the same period last year. Much that came from the fourth season of the History Channel’s “Vikings,” as well as new episodes of NBC’s “The Voice,” CBS’ “Survivor” and other unscripted shows. MGM also brought in substantial international streaming video on-demand revenue from shows such as “Vikings,” MTV’s “Teen Wolf” and FX’ “Fargo.”
And with Mark Burnett, who has a knack for creating reality TV gold, becoming president of MGM’s Television and Digital Group in January, that momentum looks likely to continue. “Vikings” just completed the first half of its fourth season and had a 20-episode fifth season picked up by the channel. MTV’s “Teen Wolf” got a supersized sixth season that will take it up to 100 episodes, and FX’s “Fargo” was picked up for a third season. “Survivor” and ABC’s “Shark Tank,” both executive produced by Burnett, are in their 32nd and seventh seasons, respectively.
MGM acquired 55 percent of Burnett’s United Artists Media Group in 2014 and bought the remainder last year.
MGM’s film revenue, however, was down 15 percent to $193.4 million. The studio only released two films in the quarter — “Barbershop: The Next Cut” and “Me Before You.” Film is at the heart of MGM’s DNA and still makes up the majority of its revenue and profit, so that $33.3 million decline nearly canceled out the huge jump in TV licensing money.
However, MGM has two $100 million-plus-budget movies coming out later this year, “Ben-Hur” and “The Magnificent Seven,” which could help the film division make up a lot of ground. It could also get a boost with the extension of Jonathan Glickman, the president of its motion picture group, through 2020.