Time Warner reported mixed second quarter results, as lower revenue at its Warner Bros. movie studio offset gains at its Turner Networks and Home Box Office units.
Overall revenue dipped 5% to $7 billion in the period, as sales at Warner Bros. were down 19.4% to $2.7 billion. At Turner, revenue increased 6.5% to $3 billion and increased 2% at HBO to $1.5 billion.
Operating income was flat at Turner in the period at $1.1 billion and down 5.3% to $481 million at HBO. Warner Bros. OI fell 9.7% to $308 million in the quarter.
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Tough comps to last year, which was a record quarter for the content company, and unfavorable foreign exchange rates for its international operations impacted results. Time Warner said despite those headwinds, it managed to keep operating income margins stable at about 25%.
“We had a strong first half of 2016, which puts us ahead of our original goals for the year,” Time Warner chairman and CEO Jeff Bewkes said in a statement. “Our performance reflects the creative excellence resulting from investments we’ve been making in the very best content. At the same time, we’re capitalizing on new distribution opportunities to take advantage of the growing demand for high-quality video content around the world.”
Warner Bros. is expected to benefit from strong expected box office from alternative superhero movie Suicide Squad, slated to open this week and recent successes like Central Intelligence and The Conjuring 2.
