Time Warner Inc. (NYSE: TWX) Profits Zoom up at Warp Speed

Posting a whopping 87% net income jump is no mean feat even for Time Warner Inc. (NYSE: TWX). The company has more than exceeded Wall Street expectations for the quarter (April- June). Company sources categorically state that the excellent performance can be attributed to the increased investment in original programming. Evidently, the top management has been calling all the right shots in this respect since viewer interest is definitely up and so is the channel’s revenue.

The Numbers that State the Facts

The numbers show that Time Warner’s quarterly profit is up $0.81 per share from the $0.42 per share position that existed a year ago. That translates into a $771 million profit for this quarter as opposed to the $413 million profit recorded last year for the same quarter.  Wall Street gurus were expecting TWX shares to stabilize at around $0.76 per during this period. Although prices dipped to $63.84 at close of day, the company’s shares had touched the decade’s peak at $66 by midday on Wednesday, 7th August, 2013

The Shows behind the Channel’s Success

TNT’s show ‘Falling Skies’, a series about the crusade carried out by humans against aliens is credited with driving viewer interest upward for Time Warner. HBO’s ‘Game of Thrones’ is another successful show that runs on the TW channel. The strong NBA season has added its might to the company’s soaring profit saga. These popular shows and sports have not only brought in more viewers but also made TW’s various TV channels highly attractive to affiliates and advertisers. Time Warner owns several well known TV brands such as CNN, Warner Bros, HBO and TNT.

The number of original hours running at prime time this quarter doubled from the last and this has paid off handsomely according to CEO/ Chairman Jeff Bewkes. TNT and TBS, both part of the Time Warner group, have emerged as top advt supported cable networks for the quarter for viewers falling in the age group 18 to 49.  Meanwhile HBO continues its successful stint as viewer favorite and CNN’s ratings from its target audience improved by a whopping 70% .

Pairing up with Successful Movies has Helped

The association of Warner Bros film and TV entertainment division with box office successes like ‘Man of Steel, ‘The Great Gatsby’ and ‘The Hangover III’ has also helped immeasurably. Tickets sales for these movie ventures brought in $2.94 billion, marking a 13% improvement in the revenue of this division. In fact, these earnings have prompted the company to postpone the spin off of the publishing division’s Time Magazine which was originally slated to happen by the end of year.

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