Viacom Earnings: Recovery Looks Like More Than Special Effects

(Bloomberg Gadfly) -- Viacom Inc. isn't catfishing you. The owner of the MTV network really does look better these days. 

Increase in Media Networks Revenue

2%

In the company's fiscal third quarter ended June 30, advertising revenue was up, revenue from distributor fees was up and operating income from its media networks division was flat. Hey, we'll take it! This is the best shareholders could have realistically expected from a company whose TV audience has been shrinking and whose film studio has been losing money. In fact, the movie side of Viacom even posted a small profit on an adjusted basis with help from the recent release of "Transformers: The Last Knight." 

There's obviously much work to be done -- namely bringing viewers back to MTV, Comedy Central and its other main networks, which have long struggled but whose overall revenue was up 2 percent. It's also going to be a while before we know whether CEO Bob Bakish's big plan to convert Spike TV into the Paramount network next year will be a success or just another Viacom flop. 

Shareholders can't get too excited at such an early stage, but the worst may really be over this time. 

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

Tara Lachapelle is a Bloomberg Gadfly columnist covering deals. She previously wrote an M&A column for Bloomberg News.

To contact the author of this story: Tara Lachapelle in New York at tlachapelle@bloomberg.net.

To contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.net.