Versant Media Group, formerly part of Comcast, has significantly boosted its 2026 revenue and adjusted EBITDA outlook, citing strong performance in its platforms segment, including Fandango and GolfNow, and positive advertising momentum. The company reported beating Wall Street expectations for its second quarter, with EPS at $1.49 and revenue at $1.64 billion.
In line with its strategy to diversify revenue, Versant recently acquired golf simulation company Full Swing and is looking to reduce its reliance on the traditional pay TV model. The company also declared its third consecutive quarterly cash dividend.
Versant Media Group, the recently spun-out portfolio of Comcast's pay TV networks and digital properties, has announced a significant upward revision to its full-year 2026 financial outlook. This optimistic forecast is driven by robust performance in its platforms segment and a resurgence in advertising momentum during the first half of the year.
In its latest earnings report, released before the market opened on Thursday, Versant revealed it now projects total revenue for 2026 to range between $6.2 billion and $6.45 billion. The company also anticipates adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to fall between $1.9 billion and $2.05 billion. This upgraded guidance reflects what executives described as consistent "strength" and "continued growth" throughout the initial part of the year.
This marks Versant's third earnings release since its separation from Comcast's NBCUniversal at the beginning of the year. The company, which encompasses a suite of pay TV networks including CNBC, MSNBC, and The Golf Channel, commenced trading as an independent public entity in January.
Versant's performance highlights the enduring appeal of live sports and news content for attracting viewers and advertising revenue in traditional television, even amidst the ongoing shift towards streaming services. The company surpassed Wall Street's expectations for both revenue and earnings in its second quarter. Versant shares saw a notable increase, trading up more than 6% by the close of Thursday's session.
Second Quarter Performance vs. Wall Street Estimates:
- Earnings Per Share (EPS): $1.49 (vs. $1.35 expected)
- Revenue: $1.64 billion (vs. $1.62 billion expected)
Revenue from linear TV, which includes channels like USA Network, Syfy, Oxygen, and E!, experienced a 6.3% decline to $954 million during the quarter, primarily attributed to a decrease in subscribers.
CEO Mark Lazarus expressed satisfaction with the company's progress, noting the completion of carriage agreements with two major distribution partners in the U.S. and Canada. Many of Versant's distribution deals were established prior to its separation from NBCUniversal.
Versant is actively pursuing a strategy to diversify its revenue streams, aiming for a 50% contribution from its digital, platform, subscription, ad-supported, and transactional businesses to lessen its reliance on the traditional linear TV model, which currently accounts for over 80% of its revenue.
The company is also exploring strategic acquisitions of non-traditional media businesses to expand its revenue base and drive growth. This week, Versant finalized its acquisition of golf simulation company Full Swing. It already holds digital media platform GolfPass and tee-time reservation service GolfNow. Earlier this year, Versant acquired StockStory, an AI-driven financial analysis platform aimed at enhancing CNBC's offerings.
Advertising revenue saw a slight decrease of 0.6% to $423 million for the quarter. However, this represents an improvement compared to the previous year's decline rate, bolstered by higher ratings across its news and sports-centric networks.
The platforms segment, featuring Fandango and GolfNow, reported a 0.8% increase in revenue to $225 million. Excluding the divestiture of SportsEngine, this segment's revenue grew by an impressive 9.3%. The growth at Fandango was driven by increased movie ticket purchases and video-on-demand transactions, while GolfNow saw stronger bookings, payments, and subscription revenue.
In a move to boost advertising and user engagement, Versant has launched a free, ad-supported Fandango streaming service. Additionally, USA Sports recently secured exclusive multi-year U.S. media rights for the German soccer league Bundesliga, bringing live matches to USA Network and Fandango starting in August.
Overall, Versant's total revenue decreased by 3.8% year-over-year to $1.64 billion. Net income attributable to Versant fell 30% to $211 million ($1.49 per share) from $302 million ($2.09 per share) in the prior year. This reduction is attributed to lower revenue, increased public company operating costs, interest expenses from the Comcast separation, and higher tax expenses, largely due to the divestiture of SportsEngine.
Adjusted EBITDA declined by 8.9% to $624 million. However, on a stand-alone adjusted EBITDA basis, which provides a more direct performance comparison, the figure increased by 3% year-over-year. This growth is credited to reduced programming and operational costs that effectively offset revenue declines.
Versant also announced its third consecutive quarterly cash dividend of 37.5 cents per share, payable on October 22 to shareholders of record as of October 1. The company completed a $100 million accelerated share repurchase program, acquiring nearly 2.4 million shares of Class A common stock. As of June 30, approximately $800 million remained available under its share repurchase authorization. Versant plans to initiate another $100 million stock repurchase agreement on August 7, expected to close in the third quarter.
Disclosure: Versant Media Group is the parent company of CNBC.
