CBS Corporation (NYSE: CBS.A and CBS) reported strong fourth quarter and full-year 2017 financials last week, including revenue of $3.9 billion, an 11 percent increase over the same period in 2016. Revenue for the full year was $13.7 billion, a 4 percent increase over 2016. For the quarter, CBS had adjusted diluted earnings per share of $1.20, an 8 percent increase. For the year, CBS had adjusted diluted earnings per share of $4.40, a 7 percent increase These figures are all-time highs for quarterly and annual revenue and adjusted diluted earnings per share.

In a press release, CBS Corporation chairman and CEO Les Moonves commented on the company’s financials:

‘I’m very pleased to report that CBS turned in outstanding fourth-quarter results, including double-digit revenue growth and our 32nd consecutive quarter of EPS growth, capping off a very strong year in 2017,’ Moonves said.

‘The CBS Corporation produces many of the most-valuable programming franchises in the world, reaching more viewers than anyone else. This gives us a tremendous advantage as streaming becomes more central to our distribution strategy. As a result, we now have nearly 5 million subscribers at CBS All Access and Showtime OTT combined. When you add this to our retrans and skinny bundle subscribers, our total subscriber base continues to grow at an accelerated pace,” added Moonves.

Other highlights for the fourth quarter include: 

• 

  Content licensing and distribution revenue grew 33 percent.

• Affiliate and subscription fee revenue grew 20 percent, led by growth in retransmission revenue, fees from CBS affiliates and streaming subscription services CBS All Access and Showtime OTT.
• Advertising revenue decreased 3 percent, but this was anticipated because Q4 2016 had record political advertising.
• Operating income was $343 million, compared to $484 million in Q4 2016.
• Adjusted operating income was $739 million, a 1 percent increase.
• Net earnings from continuing operations were $40 million, compared to $271 million for the same period last year, impacted by a $129 million charge from the federal tax legislation changes in December.
• Adjusted net earnings were $455 million, an increase of 6 percent.
• The company reported a net loss of $41 million, compared to a net loss of $113 million Q4 2016.

Highlights for the full-year 2017 include:

• Record full-year revenue of $13.69 billion was driven by 26 percent higher affiliate and subscription free revenue and 27 percent higher retransmission revenue and fees from CBS affiliates.
• Increases were partially offset by 9 percent in lower advertising revenues, resulting from the 2016 broadcast of Super Bowl 50 and reduced political advertising in Q4.
• Operating income was $2.42 billion, an 8 percent decrease from 2016.
• Net earnings from continuing operations were $1.31 billion, compared to $1.55 billion in 2016.
• Net earnings were $357 million, compared to $1.26 billion for 2016.
• Adjusted diluted earnings per share were $4.40, a 7 percent increase.

Investors didn’t have a strong reaction to the financials. On February 15, the day financials were released, CBS stock was $56.74 per share. As of 4:42 PM EST Wednesday, CBS stock was valued at $55.38 per share, a slight drop.

Insider Take: 

CBS’s financials for the fourth quarter and full-year 2017 remained strong, continuing the company’s streak of 32 straight quarters of growth in earnings per share. This is impressive. The company’s record revenue was offset slightly by advertising losses created by bubbles in 2016 created by Super Bowl 50 and the presidential election, but the company’s successful streaming services have more than made up for it. As we’ve said before, CBS is leading the way with its over-the-top streaming subscription services, and this early foray into the field is paying off. We’re eager to see what 2018 brings from the network.