Quick Summary
- Paramount Skydance (PSKY) delivered a Q4 adjusted loss of $0.12 per share, significantly worse than the anticipated $0.01 loss
- The company generated $8.15 billion in revenue, reflecting 2.1% year-over-year growth and meeting analyst projections
- First-quarter 2026 revenue outlook of $7.15–$7.35 billion falls short of the $7.36 billion Wall Street forecast
- Paramount+ finished the year with 78.9 million paying customers; UFC programming anticipated to boost subscriber numbers
- The company increased its Warner Bros. Discovery acquisition proposal to $31 per share, surpassing Netflix’s $27.75 bid
On February 26, Paramount Skydance unveiled its fourth-quarter performance, revealing an adjusted per-share loss of $0.12. This figure significantly underperformed against analyst predictions of just a $0.01 loss.
Quarterly revenue reached $8.15 billion, marking a 2.1% uptick from the prior year and essentially matching the analyst consensus of $8.14 billion.
The filmed entertainment division emerged as a standout performer, registering a 16% revenue surge. This growth stemmed primarily from incorporating Skydance licensing into consolidated results rather than from theatrical box office expansion.
Paramount Skydance Corporation Class B Common Stock, PSKY
Conversely, the TV Media segment painted a less optimistic picture. Revenue in this division contracted 5% to $4.71 billion, impacted by softer advertising markets and declining affiliate fees.
The ongoing shift away from traditional cable continues to impact legacy television operations. Paramount expects TV Media revenue to contract throughout the current year, “largely consistent with broader pay TV industry challenges.”
Forward Outlook Falls Short of Expectations
For the first quarter of 2026, Paramount projects revenue ranging from $7.15 billion to $7.35 billion. This guidance trails the Street’s $7.36 billion estimate. During the comparable period in 2025, the company generated $7.19 billion in revenue.
Looking at the full-year 2026 picture, management anticipates approximately $30 billion in total revenue, representing roughly 4% growth compared to 2025.
However, there’s a complication. The company cautioned that Paramount+ faces potential subscriber losses of 4 to 5 million due to discontinuing a “hard bundle” partnership arrangement.
Streaming Strategy and Paramount+ Performance
Paramount+ concluded 2025 with 78.9 million paying subscribers on its platform. Management is counting on exclusive UFC content to fuel subscriber expansion throughout 2026.
The streaming business represents the growth narrative Paramount seeks to emphasize with investors. PP Foresight analyst Paolo Pescatore articulated it succinctly: “It’s about whether streaming momentum can outrun the structural unwind in linear.”
Elevated Warner Bros. Discovery Acquisition Proposal
Perhaps the most significant development extends beyond the quarterly earnings report. This week, Paramount enhanced its acquisition proposal for Warner Bros. Discovery to $31 per share, increasing from the previous $30 offer.
This strategic move directly challenges Netflix’s competing proposal of $27.75 per share for WBD’s streaming platforms and studio operations.
WBD’s board of directors is currently evaluating whether Paramount’s enhanced full-company proposal constitutes a more attractive transaction. The acquisition would include an extensive film and television content library featuring major intellectual properties like Harry Potter and Game of Thrones.
CEO David Ellison characterized the WBD acquisition as an “accelerant” for Paramount’s strategic objectives in a shareholder communication, though he refrained from providing additional details about ongoing negotiations.
He emphasized to investors that Paramount Skydance maintains “confidence in our standalone strategy and growth trajectory.”
PSKY currently carries a Strong Sell consensus rating on TipRanks, comprised of zero Buy recommendations, one Hold rating, and four Sell ratings. The average analyst price target of $12.25 suggests approximately 20.6% potential upside from present trading levels.
Throughout the past twelve months, PSKY stock has declined 9.5%.
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