Investing
Building An Interactive Business Does Not Help CBS (CBS) Earnings
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Buying online content company CNET and building out internet sites for its legacy properties was supposed to help earnings at CBS (CBS). At least the company would have something to balance its huge, old-world TV and ratio operation. But, it hasn’t worked. Things are so bad CBS even had to cut its dividend.
After hours, CBS announced earnings for the last quarter of 2008. Revenue fell 7% to $3.5 billion compared to the same quarter last year. The purchase of CNET helped the topline which is actually bad news. Without it, the rest of the company would have been hammered. But, buying revenue is not a solution.
In the quarter, operating income for the company fell 49% to $362 million. Of that, $272 million was from TV and $71 million was from radio. Interactive was a pathetic $29 million. Even outdoor advertising did better.
CBS’s quarterly dividend went from $.27 to $.05.
Douglas A. McIntyre
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