Paramount CEO Bob Bakish resigns

Paramount Global CEO Bob Bakish resigns The company announced this on Mondayas merger negotiations with Skydance Media proceed.

Bakish climbed the company ladder after joining Viacom in 1997 until he became the corporate's CEO in 2016. After the merger of Viacom and CBS, he became CEO of the combined company in 2019, which was later renamed Paramount Global. He can also be resigning from the corporate's board, Paramount said Monday.

Bakish might be replaced by what the corporate calls the “CEO’s Office.” Paramount is now led by CBS President and CEO George Cheeks; Chris McCarthy, president and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, the top of Paramount Pictures and Nickelodeon. The company said the three executives will work closely with Paramount CFO Naveen Chopra and the board.

In Monday's press release, Paramount said latest leadership is “working with the board to develop a comprehensive, long-term plan to accelerate growth and develop popular content, significantly streamline operations, strengthen the balance sheet and… “To further optimize streaming strategy.”

Paramount also reported on it First quarter results after the bell rang on Monday and held an earnings conference call where the company's newly appointed chief executives made a brief statement and said they would be back “shortly” to provide details on future plans.

Chopra led the call, which lasted less than 10 minutes and did not include questions from analysts.

The company had mixed results in the first quarter, beating on profit but missing on revenue. Paramount reported 62 cents per share, excluding items, for the period, versus estimates of 36 cents per share, according to analysts surveyed by LSEG. According to LSEG, the company reported revenue of $7.69 billion versus analyst estimates of $7.73 billion.

Total revenue increased 6% compared to the same period last year, driven by streaming and the Super Bowl.

The company's direct-to-consumer streaming segment, which includes flagship services Paramount+, Pluto TV and BET+, saw revenue rise 24% to about $1.88 billion.

Paramount said it added 3.7 million Paramount+ subscribers during the quarter, bringing its total to 71 million. Streaming-related losses narrowed to $286 million, compared to losses of $511 million in the same period last year.

Advertising revenue in the streaming segment increased, primarily due to the Super Bowl, which aired in February on CBS, cable television network Nickelodeon and Paramount+.

Likewise, advertising revenue at Paramount's TV media unit, which includes network CBS and cable TV networks such as MTV and Nickelodeon, rose 14% due to the Super Bowl.

The top NFL event provided a boost in what had previously been a weak advertising environment for traditional television networks. Still, streaming platforms and digital companies are reporting increasing advertising revenue, suggesting that the market is recovering, at least in these areas.

Overall, TV media revenue increased 1% to $5.23 billion. Affiliate and subscription revenue fell 3% as cuts continued, and licensing and other revenue fell 25%, including the impact of strikes by Hollywood writers and actors on content available for licensing.

Paramount's film entertainment division's revenue rose 3% to $605 million on the back of the releases of “Mean Girls” and “Bob Marley: One Love.”

Bakish's ouster comes ever closer to a potential merger between Paramount and Skydance Media, CNBC previously reported. The companies are in exclusive talks to continue the deal until May 3, and a special committee is already in place.

Bakish has privately opposed the merger, claiming it would dilute common shareholders, CNBC reported. Under the proposed transaction, nearly 50% of the combined company would be owned by Skydance and its private equity backers, while common shareholders would own the remainder of Paramount, which would remain publicly traded.

On Saturday, CNBC reported that Bakish could exit as CEO as early as Monday and ahead of the earnings release after he lost the trust of Paramount Global majority shareholder Shari Redstone, who could view his removal as a means to expedite a Skydance deal, reported CNBC Monday.

The departure also comes as Paramount has been negotiating with cable company Charter Communications to carry its television networks, including CBS and MTV. The deadline for these negotiations is Tuesday.

The special committee – which is responsible for accepting or rejecting deals – and Skydance, which is backed by private equity firms KKR and RedBird Capital Partners have focused on how to value Skydance's assets in a merger and how much equity to add to the company, CNBC previously reported.

Skydance plans to name its CEO, David Ellison, to head Paramount if the deal goes through, CNBC previously reported.