Paramount Global CEO Bob Bakish said the media conglomerate’s main priority for 2024 will be “driving earnings growth.” The executive outlined the company’s three-prong strategy in a memo to staff on Thursday to increase revenue while closely managing costs.
“We’re unleashing the power of our content, which remains our mission no matter what challenges we face. And we have certainly faced a few,” Bakish wrote. “As an industry, we’ve confronted a soft ad market, a volatile macroeconomic environment and two historic strikes just in the last year. All while navigating the ongoing evolution of the streaming business, as industry sentiment and metrics for success continue to shift. And we’ve been on our own journey as a company — to realize the full potential of One Paramount as we transition our business from linear to streaming, and continue fine-tuning how we window and monetize our content.”
Bakish added that it’s “no surprise that Paramount remains a topic of speculation” — a nod to the recent M&A interest from Skydance Media and Warner Bros. Discovery over the past month.
“We’re a storied public company in a closely followed industry,” he continued. “But I have always believed the best thing we can do is concentrate on what we can control — execution. Leaning into what’s working, while continually adjusting to current realities.”
First, Paramount will focus its resources on the “most powerful, resonant franchises, films and series that perform across platforms globally” and will producer fewer local, international originals with the exception of its free-to-air networks in Australia, Argentina, Chile and the U.K.
Bakish said the company would “continue to maximize our global hits across multiple platforms and revenue streams – including streaming, film, TV and licensing – for the biggest return on our investment.”
Second, Paramount will remain focused on streaming profitability, leaning further into the U.S., U.K., Canada and Australia, where its content has the “greatest revenue potential.” The company will aim to increase subscriber engagement and retention globally, as well as drive revenue across advertising, subscriptions and licensing while reducing costs.
“In other important markets across Europe, Latin America and Asia, we will continue our market-by-market strategy and tap into the power of our strong local partnerships, ensuring we’re operating with the best model to drive local scale and viewership, while managing costs,” Bakish added.
In the third quarter of 2023, Paramount’s direct-to-consumer division, which includes Paramount+ and the free, ad-supported streaming service Pluto TV, narrowed its loss 31% to $238 million from $343 million a year ago, while revenue grew 38% year over year to $1.69 billion. Paramount+ has a total of 63.4 million subscribers.
Third, Bakish said the company would “look to expand our shared services model as we streamline operations,” resulting in a global workforce reduction. The memo did not disclose how many employees would be affected.
“These decisions are never easy, but are essential on our path to earnings growth,” he said. “We will continue to be as thoughtful as we can be, communicate when there is information to share and support our teams throughout.”
The memo noted that additional updates on the company’s strategy would be relayed over the course of the year.
“In many ways, 2024 will be the next great step in our transformation and we must evolve how we work to support that. I can’t emphasize enough how grateful I am for your dedication, and how proud I am of all that this team continues to accomplish,” Bakish concluded. “In light of all that we’ve achieved together, I have no doubt we are up to the task.”
Paramount is set to report its next quarterly earnings on Feb. 28 after the market close.