Paramount Skydance (PSKY) Q4 2024 earnings summary

Executive summary

• 2024 marked a transformative year with Adjusted EBITDA up 30% to $3.1B, free cash flow at $489M, and full-year revenue of $29.2B, despite a $6.19B net loss driven by a $5.98B goodwill impairment.

• Paramount+ added 10M subscribers in 2024, reaching 77.5M, and achieved the #2 domestic SVOD ranking for hours watched.

• D2C profitability improved by nearly $1.2B, with adjusted OIBDA loss reduced to $(497)M for the year.

• Major box office successes included Sonic the Hedgehog 3, and the Skydance transaction is expected to close in H1 2025.

• The company renewed key distribution deals, expanded its advertising client base, and completed the sale of Simon & Schuster.

Financial highlights

• Adjusted EBITDA/OIBDA grew 30% year-over-year to $3.1B for 2024.

• Free cash flow reached $489M for the year, up from $(554)M in 2023.

• Full-year revenue was $29.2B, with Q4 revenue at $8.0B.

• Net leverage improved to 3.8x; net debt at year-end was $11.8B.

• Adjusted diluted EPS from continuing operations was $1.54 for 2024.

Outlook and guidance

• Paramount+ is expected to achieve domestic profitability in 2025.

• Free cash flow is projected to increase in 2025, with content spend expected to remain flat.

• Q1 2025 will see continued subscriber growth at Paramount+, but at a slower pace due to content timing.

• Q1 adjusted EBITDA will decline year-over-year due to the Super Bowl comparison and restructuring payments, but full-year EBITDA is expected to grow on an underlying basis.

• Skydance transaction anticipated to close in H1 2025, pending regulatory approval.