Discovery Hits 20M Streaming Subscribers In Q3

Discovery ended the September quarter with 20 million DTC subscribers, up 3 million from the prior quarter in June.

The paying subs are largely Discovery+ but also include a handful of other services, most based in Europe. Discovery is inching closer to a merger with WarnerMedia, expected to close in the middle of next year, which will see its offerings expand exponentially with the addition of HBO Max. Executives may address the upcoming combination at a call skedded for 8 am ET.

Total revenue of $3.15 billion was up 23%. Of that, U.S. ad revenues increased by 5% and distribution revenues by 21%. International advertising sales grew 28%, distribution revenues by 7%.

Net income came in at $156 million, down 48%, in part of higher expenses, with diluted earnings per share at $0.24.

The numbers met or Wall Street expectations, nudging the stock up 0.61% in premarket trading.

“We made great strides in the quarter operationally, financially and creatively. The team drove solid momentum in our direct-to-consumer business, which we grew to 20 million paid subscribers at quarter end on the strength of our global brands and fan-favorite content, including the Summer Olympic Games and Shark Week. Additionally, we delivered double-digit growth in both advertising and distribution revenues, as we doubled next generation revenues year over year,” said CEO David Zaslav.

“This strong performance once again drove very healthy cash flows during the quarter, further strengthening our balance sheet and financial profile. We are very excited about our pending merger with WarnerMedia and the opportunity to bring these two companies together, combining iconic and globally cherished franchises and brands, and positioning us to more efficiently drive global scale across the combined portfolio.”

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