AMCX - Earnings call transcript Q2 2019

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning. My name is Jacob, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the AMC Networks' Second Quarter 2019 Earnings Conference Call. At this time, all parties will be in listen-only mode. Later, we will conduct a question-and-answer session. Instructions] [Operator

will Senior call Relations. Vice floor yours. I host, to Sir, turn is Zaslow, Seth President now you. over the your the Thank of Investor

Seth Zaslow

second and the Thank call. welcome Good earnings conference morning AMC you. Networks’ quarter XXXX to

our Ed Joining Officer; Officer. executive team Chief Chief Chief Financial Operating Officer; of Josh us members our President Sapan, this and Sullivan, morning Carroll, Executive and Sean

results, questions. discussion a of Following will for the call second XXXX the open we quarter Company's

today's of can earnings it you via don't copy If at call a on available This our website also release, our have is accessed website. amcnetworks.com. be

Please that to within discussion risks may the any cause are not such take XXXX. the Litigation contain Statements the following. could actual of results of Forward-Looking Securities forward-looking performance involve Private statements constitute note and of of or results meaning Reform and guarantees the cautioned statements future that are Today's uncertainties differ. Act that Investors

for and the to obligation Company's refer call. Commission that disclaims the Company uncertainties. to Please of may the update any during forward-looking filings Securities risks discussed this The statements and Exchange a be with discussion

the you Further, the presentation provides performance. We we information. supplemental is with in operations ongoing believe useful of discuss information results non-GAAP will the Company's and of non-GAAP concerning appropriate Company's evaluation financial your

on and to details, please refer of reconciliation a GAAP information call. related and we to GAAP will further For information, for refer to release the footnotes non-GAAP which press this

the over With would that, to Josh. to I like call now turn

Josh Sapan

to for to the say for meet We on-track in solid I'm us. delivered pleased joining quarter Good thank remain targets second the financial our you morning and full-year. results we and

flow income, free key capital on including financial deliver the growing business cash adjusted to long-term. generating operating using objectives the position to continue our for our strong and We

by calls, our direct-to-consumer and content, discussed developing have have Networks’ revenue prior linear diversifying of the we be business great interests. long-term expanding maximizing on of studio, through content creating been growing our as monetization continue traditional well our and strategic our to new priorities avenues value AMC As as

will Later pleased details evolution these to around call, provide to say in more progress I'm make area. we direct-to-consumer I our on opportunity significant and the continue goals in take dimension overall this reference, to our on strategy including both the XXXX. on

the month, outstanding content our Studios with Universe very announced set in ever a this including earlier the Walking movie announced include when Emmy Our highlights in nominations Dead for of and recently landmark Universal partnership nominations theatrical Killing for year strong were that and out The largest first our drama had Eve Soul of two group submissions eight Better Call ever. having showing

to comp continue for a six demand month managed period have we have. difficult a increases driven strong in direct-to-consumer grow upfront DXC strong we over adding services, environment that pricing our advertising We the most and by show had a ever in very with subs high and a

track is record with long this to no culture has by I Company for like if and of At on highlights hits, content creating premium our our would I year content and excellence reputation core Networks AMC a expanding begin exception. a may. defining a been

original celebrated which Lockup. Eve, for to Killing audience the its Our Gamut runs After its TV’s WE second phenomenally The programming doubled from unscripted season called successful series Love

key TV. service that of as mentioned four for It's Acorn recognition with year-over-year brought increases our demo. just cultural Emmy wide networks double-digit driving five networks, us is which I ratings become its streaming nominations phenomenon, as The a our in well nominations

consumers as ignite film for AMC This affirms Rosamund all a at as all that form high formats, receive shows Series, time Our ever. first foray whose competitive crowded quality than most into different a well importantly, for and Company O'Dowd. to in more is constituents, a called nominations as Networks recognition of Chris Best broke our State series content of Union, Pike through short actors the Short and three

an We're out able some continue extremely developing wars, extremely of billion the broader in by that we is proud informed call stand been to well than the $X screening incubating to that culture. been era are content and in shows by land what budgets

And example, a we a scale, AMC Killing Networks importance example is world development distinct Eve, preoccupied of clear with for is landscape. green what media a commissioned this strong a vision of abundance, is very internally and rapid example that in content of sometimes the it show lighting. represents makes in blurring great and and

We partnership the expands franchise. Walking Dead vitality the Studios weeks of movie the level Dead first big the the high the for undeniable screen Universal with that and a landmark growing Con theatrical couple interest the announced of time, universe Universe and Walking the commands, earlier of Comic mentioned this This underscoring deal. I ago. strength to

Dead also kickoff Con the of debuts October. Walking campaigns the marked Comic highly core season which series, promotional of The for anticipated in XXth our

Dead fifth zombie a of Walking run protagonists, in Walking season is the first begin era. And age Dead which young Universe, this series ad drama and continuing on just we highest week, on The the in supported in production two its fifth centers the is generation to third cable. Here female come apocalypse the it on vibrant rated the

Walking and in ancillary and video movie, life a businesses growth. created this opportunities around future that of multiple is early Universe now With has its franchise other many games, we we for stages merchandising shows, Dead The theatrical and have believe

We fragmentation make be content Dead would more initiative a force changes content we many you world where created existing and know, own decade just model foresaw the one cable Walking the deploy. critical. shows by As in allows a ago, many when owning studio than that of our AMC the Studios, of to began and is we us would

AMC by The ownership are current that While on note Studios. shows. have many Networks series the we ownership and also our of ten scripted Walking owned Dead, year, other important In of it's often we discuss of made to the eight AMC

program gain critical original we mass. our channels, as of as for and also linear that to continue our increase services not overtime SVOD AMC series but for targeted they likely Premiere, only will We number

about in Something a I talk will moment. more

The Company library nearly from XX Fear Halt expanding episodes year-end, content. XXXX Dead, including Catch the to our among Turn be the and Walking By the studio series to Walking Fire, XXX an Nosferatu, Dead, number Large and continues of assets The close independent films. build will getting and Terror, own

us global linear exhibition channels. as services of course for of mainstream series as our as first come will SVOD utilization services, off own time SVOD on As to future the ecosystem back global their well well come licensing our they for within and on our windows

a strong basic our in driven by of upfront robust channel advertising, year-over-year content. pricing home top resulted six AMC original is increases for demand the cable the we three grades led price to in growth which to our have with increases. Turning The seen the of dramas networks as saw cases We our portfolio strong some growth for well highest double-digit decade. other in

particular Walking advertiser is Universe There as surprisingly next Dead which interest well third in year. from not Eve, the as debuts a series Killing

these programming we addition, only the advertisers from for of In we viewers History benefiting reach U.S. are to way the in since the shows of popularity BBC’s the are increasing Natural

content. value it’s and marketers next their in America’s place X adjacent who the brands to nature is very opportunity Planet series BBC demand and high ground to in World X called breaking from this

AMC wide demos basic all on in We continues putting pressure to linear (Ph) is total cable. all networks, to industry ratings highly one-third advertisers drama find control Despite [Y +X] Networks impressions supported attractive. macro-headwinds approximately that ad that appeal desirable of on

part FX quality advertising to AMC high looking on now options two only and dramas, marketers of cable. Networks are the For Disney basic

and we leadership and prudently to have to So it. continue wisely and category we to protect value true it invest

Over has category us shift against dependencies have the the which of advertiser in marketplace. and past key actively of diversified our advertisers, several years, which changes the hedge we helped base course

monetization tools more targeting And of through become market technologies evolve to data planning investments proprietary the such made advanced era have television called Aurora. targeted ad significant in our an what tool has new we advertising and advertising and as in continues enhanced

develop tools our and multi-year tools. up us, have what data has a for building analytics And been been staffing proprietary for as effort and we we

We have sales. have utilizing targeted see audience our Year-to-date increase of now tripled beginning these we to advertisers seen tools ad are a number results. and we

our addressable in broader a Smart basis also industry advanced our consortium to to bringing business participating a meaningfully. initiatives, efforts project advertising as advertising or focused are growing on is addition such In we trend TVs. own Overall, on

Our products business values to targeting we and our mid their improve and measurement enhanced advertisers data will believe to long-term. and the in better overall they

our has agreements strategy, multi-year have supported renewed approach been our year. to far so by this affiliate several and As we

position attractive to have our us be our in AMC due As we the as due entire evolve. is to to Networks our and ecosystem of price that very continues positioned across believe advantageous particularly content very, And this discussed portfolio. past, this strength we well to the will

AMC on is Moving a the brands cornerstone reminder, the and international, branded XXX is local as to than countries. channel, with in internationally our strong complemented which carried is more of globally portfolio

The Eastern portfolio in strong led is particularly by Iberia Europe. performance, and

channels. Walking original original well air most for portfolio as Nosferatu, We our and build on AMC audiences including regional Fear for to series, Dead, continue recently our the we content as that

original for addition, library those cooking in in that content Southern just our our expand of more and and Latin content, produce we lifestyle of XXX to we America, own hours continue Europe including annually In channels than regions.

SVOD and different year, businesses, reorganization some are of thought of our of it to acquisition detail which made economics, overall RLJ our services. a of provide we SVOD entertainment than Following those around general our targeted SVOD last sense recent strategy, including our Entertainment fundamentally

and a focused interest SVOD As years, been have on growing the creating several reminder, for targeted, past we services. special

megacaps opportunity types with to a the compete that is arena, significant believe a that for fans we interest of we and the services way for offer the services new there specialty in us While will to market grow. serve these continue SVOD believe general very

efficiently half data, a audiences. investing our in We and elements sub-acquisition attract decade now understanding of have learning and SVOD to developing maintain those spent and competencies, programming how and platforms

SVOD horror as which in which distinct which I has we you Today, in Now has to services audiences, TV and to Acorn fans. for suspense addition British of four RLJ Channel acclaimed and will Entertainment. state we remind Premiere Sundance AMC targeting films, or services, our series acquired and UMC critically The targeted Movie our mysteries of have Shutter part dramas, Urban audiences. two latter services and urban

four these recentralized services and more the decade profitability. executive, Panetta, launched than who company that Miguel been Entertainment has into Acorn RLJ of built with TV and leadership for a We under

say growth to of mentioned end two services. on mid-year we the and million aggregate, pleased four XXXX, of that are seeing target added we in very rates these to subscribers. very subscribers ahead earlier I'm comfortably approximately XXX,XXX across Through healthy we're year as I

with subscribers gain our them As is with sufficient these content, services helping has been resonating drive and have populating rates. increasingly scale, been growth original which healthy we

SVOD general services than target Given are ability know as we genetics subscribers show the point important of mainstream the services, a more interest an that our all or pursuing with individual broad in SVOD have for very to efficiency and out that we audiences coming and often experience people series. radically retain

four our So stages. at services different are development

seen if streaming to services when can managed not have and Acorn in lowest the that most. churn We of one levels. sub of and of acquisition believe the costs it industry rates be industry comes engagement We leading is churn one customer it to the has the leading the

subscribers million crossing half SVOD anticipate and between dollars revenue We of million in to services. from four XXXX the cube million billion to seven X.X these XXXX and we a by excess in four five by targeted million sub-threshold anticipate

overall been for architecture, bring and is consumer that DXC into our allows we the to Tech integrated month-after-month. own of now Stack five needs this developed of That them understand plus part years. back work the As us

so from We us and substantially services. our subs of Networks many specialty is own today marketed AMC on have our buying something are platforms, SVOD other directly majority the build that services, DXC the differentiates

is This and a with data to in the provides time. and us see us relationship important allows real and working direct-to-consumer what not working

have with succeed this and the take expertise to arena. investment experience in relationship right that and this does build consumers, the that believe of assets to-date our we evidence set shows time it and we to While

meaningful Importantly size success subscriber seen investment. than and engaging creating we content, lower relatively to We at interest modest general content services. and can our achieve levels spend services believe significantly have much in relative with marketing we earlier

overseas we the Additionally based, to of And U.S. is internationally are particularly very currently overtime. Acorn. is the our launch with believe beginning now bulk for us particularly business opportunity DXC we market significant

a because pressures long are So time. them manageable, while are we closing my we in of from pressures macro the areas part, there believe these on for periodic plan for business, specific

stake Over untapped revenue BBC to and prepare from materially creating taken believe internationally ownership and the America, important past ten acquiring years streams we our an steps we potential. expanding to business studio, have the has to diversify because our channel in

traditional a other efforts In advertising at put XX% affiliate point NVPD areas our diversification about total as of XXXX revenue of represented U.S. with revenue and upwards in of that of XX% Today reference from Company about now XX% business. level coming our of our U.S. our revenue.

detailed significant As are direct-to-consumer enjoying our services I just momentum.

on continue we As content, studio creating growth us. and owning enterprise, significant our property our we which remain represents to DXC intellectual for more along after entire expanding focused sort believe curtails premium of our with areas

the detail results. may, call more on I our will if to specific I turn Now for over Sullivan Sean

Sean Sullivan

Thanks and morning. good

Company quarter million the the total EPS my on-track remarks. XXXX. the free cash targets total healthy The months $XXX were in we $XXX more and on Company six We for to outlook in of generate later results of million, are will was remain million in And flow million Company meet detail pleased I adjusted as second quarter to and for $X.XX. AOI our $XXX continues June very touch $XX the on in ended was full-year. levels revenues our the firmly

million our prior of as the performance the year to was X% $XXX National AOI to QX moving an period. decreased compared Networks segments $XXX So the operating X% to million, of increase at revenues

Advertising quarters decreased revenue in XX%. the

and in Fear timing call, fewer Dead The have influenced prior as of period. Dead last the we year were of Walking highlighted As Walking originals, to by our the on episodes results the compared particular,

factors well WE as including growth other and our network. number our offset pricing helped a each at portfolio networks, TV BBC increased of unfavorable to However, IFC, the comparison, of of across four Sundance as America,

distribution distribution, increased to revenue X%. respect With

flat revenues with the essentially prior period. As subscription for were revenue component, a

of to macro last we fluctuation our various the mentioned and factors call. to renewals see as on we addition agreements, quarterly timing based to In the continue adjustments, mainly due moderation on

of addition, our quarter results a resolve interpretation with partner contractual were distribution We're in and second future. of hopeful that partners. our near our one are the will with In differences by impacted the in discussions this provision

the to revenue, component and of our The Dirt Dead, Walking content the primarily XX, growth. for The Diet continues quarter this the prior Gently distribution in than Fear offset As from item top-line licensing the of growth and line Terror which was Lodge the period. driven revenues contribute in by absence to Land availability more the year

versus expenses $XXX Moving expenses operating to prior expenses, total decreased and the X% originals or portfolio Technical principally year X% to of of and mix our million. variance across million the to networks. timing decreased $XX The period. related

the to the of various decrease costs million prior timing of due of the In the in in to we quarter dollars marketing to related X% write million SG&A $XX The related originals. versus $X million primary variance of a programming $XXX charges a were year second recorded in This quarter, decrease assets. period. of off in the write offs to second compares expenses quarter XXXX.

other Moving grew well of AOI of revenue segments. international $X international versus as million increase acquisition prior RLJE. primarily to was on Levity. the and $XXX and XX% the of revenues networks increase $XX quarter an acquisitions the increase was our primary or the to second The year. In an and as million. from RLJE international million attributable The reflected to increase other

to in favorable second well increase was $X.XX, in the net. prior income to variance reflected $X.XX a prior in EPS, expense, year. as and tax was an the On The to a basis miscellaneous Moving year-over-year EPS GAAP period. as principally decrease a on adjusted in the quarter compared $X.XX $X.XX, basis EPS compared

in other to reflected the quarter. businesses. our evaluation The quarter restructuring charges also forwards. from NOL of decrease and reflected in foreign the taken $XX direct-to-consumer for restructuring EPS related GAAP book charges related million rate release other the the relating The to allowance tax of carry and benefit a

UMC In our placed services, the DXC we businesses. streaming under the the reorganization of team. structure management our reorder a Sundance TV, connection for RLJE second Shutter, with in and acquisition, Now subscription Acorn management our common announced The quarter

We changes assets. We services. more to efficiently SVOD resulting and off also strategy to in structure certain this effectively operate write and of new strategy the our implemented that will allow programming believe our us

As area very mentioned, performance Josh this in of seeing encouraging we are business. our

the Given outlook our achieving this recent next performance for our and services, foresee to rate aggregate the we months. profitability within these of run in services all XX

another million had cash cash. quarter $XX million to $XX interest Through free million, cash were million. payments interest to and Company in were $XXX distributions six six non-controlling $XX generating of the $XX flow, free million, total was a months, million months expenditures $XX in Moving strong tax capital resulting were

the compares million million of amortization Program rights period cash $XX six cash payments for were prior the program the $X $XXX for $XXX of for and writes resulting year million in of months source period. of programming was This million. use

Turning to sheet. the balance

$X.X XXth, LTM of leases ratio X.X AOI had was billion, our As times. on million Networks in AMC net of $XXX debt leverage June based capital of

capital represents investments. repurchased investment our quarter core primary be the terms repurchases in our and respect in we approximately focus continue of shares. use capital our of With disciplined the to $XX $X.X both remains allocation, Company and opportunistic during million second for repurchases share million In of non-organic business, This stock. to

Subsequent $X Company a the has shares. additional end approximately to the quarter, of repurchased or million XXX,XXX the an

$XXX its million program. available As of existing under last had Friday, the authorization Company

approximately purchased of XX% outstanding our shares. have we to-date program So

to activity. continue share with expect We our to be repurchase opportunistic

beginning of full-year there communicated as to remain ability the that the our achieve year. in the the changes no to are we Looking confident ahead at outlook we target

to our various Based Company full-year performance to adjusted the trends operating the our full-year and total half first Company in that are our ability expect revenue of we We confident the income through low the achieve continue mid-single-digit businesses our to in remain on we total the in target. single-digits. low full-year and to year in seeing revenue grow

However to have seen a year-to-date, given streams continue the we expectations shift bit. what revenue for

as as see in outlook continue growth. improvement domestic revenue our for the well the an expectation advertising We revenue subscription to on for domestic moderation

consistent domestic licensing prior be to rate to of respect growth we anticipate the revenue relatively year. now With content the with

while the aggregate overall, changed. shifted not little streams expectations have So have the bit in a revenue our

the the as content variability financial growth continued In As year year for the licensing investments performance we in quarter shows. anticipate in by our of prior airing revenue. we this of and our our the of third the revenue period. content during cadence an timing quarterly be consequence a led of anticipate expect growth increase will networks specific We versus on the

As and to National originals mix of timing mainly airing a the year-over-year anticipate for networks. on expenses the due we our Networks, increase of

Our be in our continue the in saw will results impact the reflect impact the and other RLJE international would the similar that we segments quarter we and second AOI. terms to and what revenue to quarter third of of business in reported expect of both

RLJE in the AOI. segment businesses the deliver revenue other both healthy in and expect to in-aggregate we Excluding growth

our overall, about conclusion for in remainder very year, the feel business we in performance the So and of how good is XXXX. first positioned half of the the

to portion the So if move we would open call. of questions? Operator the with and call could question you to that, please the answer like to

Operator

[Operator Instructions] Research]. Michael question comes Our Nathanson first from [MoffettNathanson

Michael Nathanson

affiliate let What have that help just what's start was with up details you one I revenue a me the then then of quarter? on in for dispute? impact line? Thanks. scale Could Sean I Sean this second. one Josh. for Joss. change for the subscribers contract your And us? And Could us for with you one the have for more

Josh Sapan

just We conversations with another. about nature some in changes. it's that Josh. over give several periodically will as think happens contracts are thing, and one if have question. the may first to interpretation we There contractual it's of in have an we say they years Hey go you the is it’s to if Michael, think your life who response MVPD, just I I business

activism in with engaged their conclude currently can't I actively those will conversations are about dynamic how them speed. and conversations report We it.

a few perspective change quarter subscriber in Second million growth piece dollars this, MVPD for among a what was of universe. in guess responsible I the it's is

perhaps than trended the As a better down you know in quarter bit. I this and

paid is course units of are of that affects we on individual So us. subscribers

the is So on that. two those about things Union that the asked and the State you are of

Michael Nathanson

film Okay. your I'm on partnership. actually economic Josh, interest trying the And can understand to I about side. the

the guys XXX% risks. you are So producing the show taking

you give then sense actually parts what's could other a So how AMC maybe franchise. larger relationship actually here? could help And of the economic of film the that

little us. of bit details a more a So for film

Josh Sapan

Sure.

if my So first itself. studio to just of in our - opportunity big really I may. say a Michael, vital if that from the I will view, the just track obviously, it's you point has context, think me Universal I sign if with now excellent is provide may offer of don't franchise screen bring just preeminent mind, of the let speaks I a partnered that that view, to for record the point

the meaningful dollars Walking would three to the that the I merchandising, worldwide I silver will it of an level, note a experts Walking a Dead go that highest have belief to screen. And that series the so piece we just And as something people now which those be that in of relates games, pay basis on on just activity. is and television to will that Dead is in affirmation the at

an say It and that. of that and will interest to fairly studios a among there strength was it I affirmation widely and franchise. unique, not representation And is was do therefore singular,

If you comment, it's that mind don't important. think I

information. to I'm is it sorry what the I liberty I'm the not privileged into and what nature gets of all who of it’s short so information who for stop have say to is go we It's privilege of very going the deal into the I'm sort us. have nice what on reasons for owns getting to would movie to a at said, details fees

Michael Nathanson

hurray Okay, move then for the it Josh.

Josh Sapan

Okay good.

but now You soon. somewhere, buy can tickets not pre

Michael Nathanson

Okay.

Operator

Thank you.

with comes next from Our question Research. Wolfe Ryvicker Marci

Marci Ryvicker

That and you give down what percent us question relative domestic and question are you you today the the including on year when as last can quarter down, SVOD services that are are first Thanks. all is versus the about you targets this last versus international and what sub-trends trending subs quarter I two, for year? to your second international the they well? OTT last gave have talk versus

Sean Sullivan

Sure Marci.

the mean receive subject Just reports subscriber it, I doing. everyone of so what I counts, all part you on et the company on we reports think subscribers the ones, cetera. I if Every is Charter, recently to I think Comcast big may, on filings, as reported just are world their AT&T, Direct TV,

So think looks that I track significantly that little that exactly that happening look universe reveal would you we picture will is that while with we see what like. affected what at you clear trend the give pretty a data in and of I precisely don’t that by that would think are

In international, does the have experience video-on-demand, include performance, much not look. with as have yet of pieces subscription we beginning which year I a does we take we terms domestic it the business mined some experience look have full-year so the include with international out just more we as mentioned, both Significantly - that. of

Ed Carroll

really I say all additions begun and for U.S., today, Acorn uptick on subscriber that is we the this Marci just Mexico in we for XXX,XXX the is And substantially Ed. mentioned operation subscriber would that example. Australia have

very days early the now by almost international Sundance subs centric expansion. UK for point, Shutter little a it’s have in and those and at bit but large We and all this Germany, of U.S.

Marci Ryvicker

you. Thank Okay.

Operator

you. Thank

We Guggenheim Michael have Morris with Securities. from a question

Michael Morris

Two morning. if could. two or good I topics questions you Thank

decision that way off little and a those the mentioned how versus series, SVOD, can series you back keeping like? reselling to AMC about talk do your them mainstream look you come come internally Josh those as process with externally economics about them to First, what maybe more bit you they what

could then little just about on like to is existing you talk be need second, overtime that subscription content businesses to those look can that where and compared the you revenue and targets of want the those you revenue bit and And specialty build to services SVOD of you Thanks. businesses? the to your a what margins solely kind your gave us

Josh Sapan

Sure.

I with So will would Michael comeback the series happily. present as characterize us opportunities of which decisions actually

the and much being the that be is a we news optimize to them our in where what able in in will make We to something value. manner series-by-series in position of about privilege very can determinations industry It’s today. deploy

opportunity grow will utilizing of to including course, on them services worldwide on the themselves, and we and be, will that mentioned. as Premiere economic what to evaluate our four is also AMC sell subscription evaluate opportunities them a services basis, that and Our third-parties on

the is simply could because to certain sold this may complicate decisions it's answers - they our Just decision, that answer, overlap. and Michael, geographies in a We make those are hypothetical market to others, period and services the work for ourselves. in that might for own not does develop we we them your a discrete And of where areas, way. time, other take

money about about from to we subject it's is So the and And our that will own on have talked of we on we yield determination can services, although make exclusivity and third-party there non-exclusivity will there SVOD can much so that well. as also in a world, not the is a values we the versus that make determinations a series-by-series basis, drive balancing services.

news constituencies, established series, good a we reputation, been is really The under and is nice generations histories that many exposed. have have significantly number you as and know, it of these humans awards. have news And and is, frankly, well

value make genetics, in think that our us, and are we're as going that we fair going be of I they to of have exactly determination do about extraordinary think deploy and recognition, amount because so a prestige them. I to to to we a see quality And

no Today, contemplated As our to the second there in question, are services your future. ads ads are for are commercial them There no them. free. for

presume free targeted groups. does and we really about, talked So subscription everything around at and commercial passion assume, is

commercial we're these them subject whole subject, discuss the which commercial is in doing The a for we services a free, conversation. can different and all But is in and AVOD what are be is are separate plan we of to free.

Sean Sullivan

economics. I by or If Acorn. against most popular relates content of are question for to reasonable programs example for it its coproduced Acorn as your Michael produced Many can, and

of breakout Mystery, producer shows the some Acorn Manhunt, Queens is or So co-producer. of a and like

data so are targeted would targeting to is continue will AMC we most think they a though, appropriate content What because and window on Networks target is as that successful. are what immediate interesting are that using that feedback beginning And they show our give what audience, have a imagine on also you for is analytics SVOD. to specific we very streams

window for just begin from Nosferatu, season So renewed two story and AMC on premiere our WE Braxton's seasons have will Vampire of which and early the see SVOD example, you that on its on to that we TV to example, Shutter UMC. is for

will mentioned Greg Nick then called producer on Dead. which a Otero, Show, who producer And the its horror of on is series a Shutter. Walking is premiere executive make will He I also Creep

to continue you relationship So SVOD networks platforms. a begin the as linear benefiting us they the the and targeted mass to between symbiotic from see gain on

Michael Morris

dual different figured the similar just from content margin of are that sharing a existing could And because is profitability stream or have sort you platforms of profile new so the the despite perspective? that look you the think benefit it single the that fact your you versus still revenue on business, fundamentally

Sean Sullivan

is said just about think everything to the No I it. way think we close you

Michael Morris

that. for you thank Great, Okay.

Operator

you. Thank

JP Our with Morgan. next Quadrani question Alexia comes from

Unidentified Analyst

to the channel as this might which [indiscernible] think directly back about the taking or a our aggregation versus larger services acquire thanks going And serve just Alexia Hi how yourself services, Amazon you subscribers? to like partnering for these is question. SVOD for funnel Apple launching with do

Ed Carroll

Sure.

is this yes Ed. So

both we good. think are So

which this some working direct-to-consumer platforms, of year. of the a but been to partnered We both for we mentioned at the majority number are as subscribers larger of our point our of platform develop on are have Josh

gives us a shows percentage immediate feedback, next. series are subscribers about much watching, where what after of us finishing watch episodes to more who completion, our That more that are, they what go data what they gives one they go they series, to

with get that You DXC.

We us subscribers very it those also against subscribers. make to have keep efficient analytics for very, that

your larger reaching churn very, to and at critical the and is and marketing to you Josh methods have component Sean rate so if preference with to a very platform As alluding new efficiency. to were subscriber maximum a just control window churn managing out you managing

partner, our Having we partner said to and of platforms. a partner, on that be good Amazon continue is some both think will we platform Apple our a own is on good

Unidentified Analyst

is ABC see at Sundance, on on, you the going of Thank being different a show be maintain do time? you. will great brand do follow-up think recently distinct obviously announced you forward That Killing Eve, as success your saw I channel channels. How two other of that and and simulcast simulcast great more in a

Josh Sapan

the the a are to simulcast with something do - show give creatively Killing seem ratings of, the AMC sample as and which it to we on interestingly was to America recognition not we well. opportunity the strong thought and BBC tonight work new were able think Eve held exposure, is Yes and show on people show we continue Emmy be wider to fast and unique this quite lot we got the

our are only big events not looking and So that in and where where got are the we concerned a but will events it. franchise, people able use value Earth them behind as is world to Planet such we programming, in think block what the we for to special is we for simulcast done events way give are attention more road big it that have a and a more to also occasionally extraordinary advertisers thinking

Unidentified Analyst

Great. you. Thank

Operator

Thank you.

from from have We Sanford a question Bernstein. Todd Juenger

Todd Juenger

talk bit morning. if of you guys question. Can about I Thanks little line. sort don’t with good you Hi content licensing mind a the the for taking

XX XXXX higher in so And or saying would in just had rate. couple be been Sean than you think the quickly, quarters, XX past that I growth

this think said morning would it to you XXXX. similar I be

of know what but with us. that change big So share just if that, changed don’t and you wonder lead is, I has to could how that

when specifically does about talking a question deals going broader business will you forward overtime philosophy with your the the role going on Josh, a maybe financial impact? even and revenue SVOD output deals it the how like think or place is, to that playing together forward content come and licensing that your output that Thanks. off, you in does and and seems own content change that and how - on content about the does relate services reconcile and partners then do are trade your it that to Sean there, how licensing with opportunities And have contemplate, them, you is

Sean Sullivan

terms XXXX right believe Thanks that our of in Todd. you to bit, is for related we one, of content Yes, growth. the It's Again, for got moderate a continue on it’s have lot licensing. an of to it outlook first frankly. on area year a timing,

But is as on EST, there is video, home not et is there merchandising, know, SVOD. that is there and you and gaming, domestic only cetera. of the exploitation licensing show the international

really timing of other visibility of have, so But, lot those bit. a is have perfect don't some effects. But we that there it's components overall, a to. on a moderated areas So

Josh Sapan

the of chime services, Ed us. SVOD And several will you an represents instantly, And add, if have of will with what The now content. has activities, for I into you is do the of to may. been years I subject student trade-offs think a anything in, on Todd we which subject. development if the our understanding ask I opportunity he to

different house we as general in entertainment quite services described, for at levels, spending now or with and their are very then obviously. share services one that whole Our And are cost heavy another competing the composition.

what we thinking will will to and have, is. And So Frankly take show that these is that is into do we we will begin applicability its economics at look development scale. our also what are, as services what increasingly a factor every we

bigger. make third-party will costs. much of we as much, have naturally where nature, international to services There that other we on a their an are nature will them may, basis is. because attractive determination worldwide simply will and be their or may greatest some return I which editorial That find projects, shows the also of services I the because be call to of their basis with if we or There appropriate a exploit bigger

hard will the same scale So and binary will net return and SVOD be the or where be be not our and of based for content, us, playbook the The is, playbook, a size, its nature economics services. greatest there not fast. it of It the a developing will upon plot show-after-show.

in will I each strategic and in grow against the all and about that, opportunity more different balances has play arena mainstream sensible follow rights a know and that there We economics is of coming world economics. that instance and live pattern SVOD a in back. much discussion we

Todd Juenger

Thank Okay. you much. very

Seth Zaslow

Operator.

the Let’s next take question.

Operator

you. Thank

comes question from next Our Joyce Evercore David ISI. from

David Joyce

you. Thank

pricing some was enter questions bringing if on more wondering could strong Thank you. more just that efforts. color impacted into there. just bit the since provide and the to-date had is addressable environment, I growth And Aurora discussions that little in to starting that, is the had incremental the advertisers advertising has Just the in fronts us there? you some you it up

Josh Sapan

Hi been more David. CPM think with very really strength pricing it the that or of I part Yes, that and our conversations the bringing in, much think of at in has tool in auto the are marketers prospects. it’s And that new target bringing bigger to advertisers movie I category, to studios seeing the conversation. Aurora much at is we pharmaceutical efficiencies helps commitments the to for receptivity ability their upfront its Aurora hyper very than higher and and category, pricing in particularly so category and client part create

David Joyce

Alright. Thank you.

Seth Zaslow

to Operator point please. take we question at one like this would last

Operator

Thank you sir.

comes question with Cannonball Research. Our from Karasyov final Vasily

Vasily Karasyov

morning. good Alright

question a two Josh think and on so I for my parts touched it’s think you my AVOD, maybe more. Ed. I Josh little is question is

surprised you U.S. the by I'm about also usage are who, and all growth not of talking talking the I'm first in about So only in TV. AVOD Pluto

especially they lot on has metrics it available started their content that putting on content. before closed growth a of the Viacom think acquisition, given quality after of been Viacom was I disclosing the

subscribers your is and internationally a made given and per for to ad linear commercials offerings watch you on people you networks an to being appreciate about ARPU So way to and and and say does propensity lower argument more would maybe tell supported guys. was showed your there GDP historically internationally DTC capita on? that argument is this tier ad evolved a to what income competition PayTV free given PayTV to how would your and So that where lower also thoughts capita it back least per what and television get be so an at

Josh Sapan

for thanks Sure that.

time we surprised, to we in content them with tracking I them so participants and AVOD license for AVOD, services, are some we partnering think time. are for not we have some been our

And and been. services have what so active understand we AVOD participants trends are in the

I think attractive that it’s platform an medium. attractive and

say wouldn’t are I that So surprised. we

while, just they service least didn’t we surrounding itself the around I territory it think an was to interesting really of U.S. transaction relationship been, the movie you because a in AVOD, question Crackle call at was by a get have that. into their as and on AVOD discrete rich some SVOD, but there entities. studio, was a know run for it

different running [XB] (Ph) others. people has it Pluto and, So and and it are around

because without some you consider. they resolution what And know that to pay I one then models for determined are pay so Hulu perhaps that you to And is the the for has commercials. will it the and interesting jury where optimal emulates the final music don't services model be, this

that to and has of particular is successful. been That variation that relevance is Hulu sort a

the in well. world you work in in other video option don't AVOD audio But premium the that cases in quite some As premium have mentioned, the the options a services world. see we

is it's looking what that curious in know this, hear then of performed, are it's video, on how than to you advertising more with to think platforms that video because that to expand want occurs Just telling. launched worth perhaps even really like free variance about the YouTube, it's I world you at they inhabited think commercial were and there

a conclusion sell it's up my an opportunity the best is of a called guess as geography for any commercial about is to this create variant. jury is point entry to I about a made all commercial determination not necessarily free traffic in whether the free

been Premier. of AMC rest Destiny else the buy Premiere free the with And up, and dedicated a as we in We AVOD commercial world has AMC AMC of have probably to experience if fair in you Hulu. than from it anybody amount that. with want video call except with services experience the AVOD The U.S., almost more our AVOD understand no that

where clue different different your in a to to question may big provide So think the an about you focus perhaps that. that where U.S. about complete lies, really sensitivity or point that correctly answers geographies democracies but the in I price on is out, future in

A, a evidence to-date are a people in entree is better really final about the an concerned flavors one. AVOD B, would I say necessarily specific right dollars say better in this more point doesn't up of its case, and their be which pattern out Where But coming or mixed destiny to wallet is the sell. quite may of

Vasily Karasyov

you. Thank

Seth Zaslow

point, would you Operator, AMC Alright. now interest we thank this for on joining can your call. Well at conclude for and the us in call. Networks everyone today's like to

Operator

now may sir. you concludes Thank you call. Everyone disconnect. the That

AMC Networks (AMCX) 31 Jul 192019 Q2 Earnings call transcript