By Stuart Thomson
Discovery has said it had 22 million paying streaming subscribers at the end of last year, including recently launched direct-to-consumer offering discovery+, up from around 20 million for the prior quarter.
CEO David Zaslav said that the strong streaming subs growth provided “a tailwind” for revenue growth of 11 per cent. However, even advertising growth reached 10 per cent, despite the challenges facing the ad market.
Zaslav said that Discovery now expects its merger with WarnerMedia to close in the second quarter following approval by the European Commission and a green light from US tax officials for the proposed structure of the deal.
Discovery posted Q4 revenues of US$3.2 billion, up 10 per cent or 11 per cent per cent excluding currency movements.
In the US, distribution revenues grew by 17 per cent, outperforming advertising revenue growth of 5 per cent, while internationally the placing was reversed, with advertising growth of 12 per cent exceeding distribution revenue growth of 5 per cent.
Discovery+ was the main driver of streaming growth, the company said. The service also helped deliver the increase in distribution revenue, offsetting a decline in linear subscribers. Distribution revenue was also boosted by increases in affiliate rates.
Linear subscribers dropped by 5 per cent over the course of the year excluding the impact of the sale of the group’s Great American Country network.
Discovery has also moved forward with plans to deliver an “ad-lite” offering in key markets on the back of moving its European streaming subs base to the same technology platform as the US. The lower-cost ad-lite version of the service will debut in the UK in March, providing access to unscripted content but not to premium sports.
The factual content giant posted OIBDA of US$1.14 billion for the fourth quarter and OIBDA of US$3.82 billion for the full year.
Zaslav said that 2021 had been “by all measures an exceptional year for our company” that had delivered close to US$4 billion in cash and generated “robust” cash flows, which would support “our ability to invest in growth initiatives”.https://www.digitaltveurope.com
