Earnings Recap: Lessons From This Week's Results

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Another week of earnings is behind us — what have we learned? Mainly that newspapers are still in deep trouble and that the cable business is a decent place to be in a recession. (Note: Because it’s the tail end of the earnings season, and a bunch of media and entertainment companies including Disney (NYSE: DIS), Time Warner (NYSE: TWX) and Yahoo (NSDQ: YHOO) have already reported, there are fewer big surprises.)

The bleeding at newspapers continued (I know, big surprise, right?) when the Washington Post reported that fourth-quarter newspaper revenue was down 13 percent, and Cablevision (NYSE: CVC) said it would take a sizable writedown on its Newsday acquisition. (The 13 percent drop was pretty much in line with the print declines that other newspaper companies reported this quarter.)

Unfortunately for the Washington Post (NYSE: WPO) a $1.6 million gain in online revenue (up 5 percent from 2007) wasn’t nearly enough to offset a loss of over $30 million in print-newspaper revenue during the quarter. As for Cablevision, in addition to writing off 60% of the $650 million it paid for Newsday in July 2008 — that’s $400 million of value lost in just over six months! — the company announced that it planned to start charging readers for access to newsday.com.

–Results from Liberty Media (NSDQ: LINTA), Discovery (NSDQ: DISAB) Communications (NSDQ: DISCA), and Cablevision reinforced the notion that cable television is proving to be one of the more resilient mediums during a recession. The extra revenue from subscribers is a welcome boost to cable operators and networks struggling with tepid interest from advertisers. Liberty’s Starz Entertainment grew its revenue 8 percent, mostly by adding more subscribers and raising subscription rates. Discovery Networks saw its U.S. subscriber revenue increase 13 percent, while Cablevision’s subscriber revenue was up 8 percent, thanks mostly to more digital video, data and voice subscribers.

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