Time Warner improved its first quarter financial performance and bested analyst expectations, but profits still dipped 11 percent due to one-time write-offs.
Not even the success of "Sherlock Holmes: A Game of Shadows" and "Two and a Half Men" could keep net income at the media giant from sliding to $583 million from $653 million in the same quarter last year.
The drop is partly attributable to subscription and advertising declines in Time Warner's publishing unit. There were also a series of charges associated with shutting down the company's general entertainment network in India and other restructuring costs.
And the cancellation of "Luck" cost the media company to the tune of a $35 million "impairment." Time Warner's premium cable channel HBO pulled the plug on the race track drama in March after three horses died.
Also read: Why HBO's 'Luck' Wasn't Fit to Run
Revenue at Time Warner grew 4 percent to nearly $7 billion and adjusted earnings per share climbed 16 percent to 67 cents, beating Wall Street's expectations. Analysts had projected revenue of $6.8 billion and earnings per share of 64 cents.
Shares of the company were down .95 percent to $37.56 in early morning trading.
Anchoring Time Warner’s performance were its TV networks and TV and film studio businesses. Revenue rose 4.4 percent to $6.98 billion, topping analysts’ prediction of $6.81 billion. $3.6 billion of that revenue came from the TV networks, a 3 percent rise from a year ago.
A jump in subscription revenue and advertising revenue led the way, offset slightly by an 18 percent drop in content revenue. March Madness propelled the growth in ad revenue while lower sales of HBO’s titles caused the content revenue to drop.
Revenues rose seven percent in the Film and TV Entertainment sector thanks to higher TV licensing fees, subscription video-on-demand and a film slate anchored by “Sherlock Holmes: A Game of Shadows.” The sequel to the Robert Downey Jr.-starring action film took in $535 million at the worldwide box office, surpassing the performance of the first installment.
The one pockmark was the publishing business, where revenue declined three percent to $773 million. Advertising revenue dipped five percent while subscription revenues dropped two percent.