Paramount Global missed first-quarter revenue estimates after adding fewer subscribers to its streaming service.
Paramount+ added 4.1 million subscribers during the quarter, compared to 9.9 million in the preceding quarter, falling behind the competition from established players such as Netflix and Disney+.
The company invested in original content to attract subscribers, but it appears to be consuming cash at the owner of the CBS (NYSE:CBS) network.
Adding to the entertainment company’s woes, advertising revenue fell by 11%.
Overall, revenue for the quarter was $7.27 billion, compared to analysts' average estimate of $7.42 billion.
Paramount+ and PlutoTV, the company's direct-to-consumer unit, saw revenue growth of 39% in the first quarter, while revenue from its filmed entertainment business, which makes and distributes movies and TV shows, fell 6%.
Paramount’s operating loss was $1.23 billion for the quarter, compared with an operating income of $775 million a year earlier.
The company also cut its dividend to $0.05 per share.
Paramount shares sunk by 17% in trading before the bell.
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