ViacomCBS : 4th Quarter '21 Earnings Transcript

Corrected Transcript

15-Feb-2022

ViacomCBS, Inc. (VIAC)

Q4 2021 Earnings Call - Investor Event

	Total Pages: 32
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ViacomCBS, Inc. (VIAC)	Corrected Transcript
Q4 2021 Earnings Call - Investor Event	15-Feb-2022

CORPORATE PARTICIPANTS

Anthony DiClemente	George Cheeks
Executive Vice President-Investor Relations, ViacomCBS, Inc.	President & Chief Executive Officer-CBS & Chief Content Officer-News
Shari Ellen Redstone	and Sports, Paramount+, ViacomCBS, Inc.
Chris McCarthy
Non-Executive Chairman, ViacomCBS, Inc.
Robert Marc Bakish	President & Chief Executive Officer-Media Networks & Chief Content
Officer-Unscripted Entertainment and Adult Animation, Paramount+,
President, Chief Executive Officer & Director, ViacomCBS, Inc.	ViacomCBS, Inc.
Thomas V. Ryan	David Nevins
President & Chief Executive Officer-ViacomCBS Streaming,	Chief Content Officer-Scripted Originals, Paramount+ & Chairman &
ViacomCBS, Inc.	Chief Executive Officer-Showtime Networks Inc., ViacomCBS, Inc.
Tanya Giles	Maria Panayiotis Kyriacou
Chief Programming Officer-Streaming, ViacomCBS, Inc.	President-ViacomCBS Networks International Australia, Israel and UK,
Brian Robbins	ViacomCBS, Inc.
Naveen Chopra
President and Chief Executive Officer-Paramount Pictures and
Nickelodeon & Chief Content Officer-Movies and Kids & Family,	Executive Vice President & Chief Financial Officer, ViacomCBS, Inc.
Paramount+, ViacomCBS, Inc.

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OTHER PARTICIPANTS

Michael Morris	Rich Greenfield
Analyst, Guggenheim Securities LLC	Analyst, Lightshed Ventures
Bryan Kraft	John C. Hodulik
Analyst, Deutsche Bank Securities, Inc.	Analyst, UBS Securities LLC
Brett Feldman	Jason Boisvert Bazinet
Analyst, Goldman Sachs & Co. LLC	Analyst, Citigroup Global Markets, Inc.
Benjamin Swinburne	Steven Cahall
Analyst, Morgan Stanley & Co. LLC	Analyst, Wells Fargo Securities LLC

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ViacomCBS, Inc. (VIAC)	Corrected Transcript
Q4 2021 Earnings Call - Investor Event	15-Feb-2022

MANAGEMENT DISCUSSION SECTION

Anthony DiClemente

Executive Vice President-Investor Relations, ViacomCBS, Inc.

Good afternoon. My name is Anthony DiClemente, Head of Investor Relations. It is my pleasure to welcome you to our Investor Event and Fourth Quarter and Full Year 2021 Earnings Presentation.

Before we begin, please note that in addition to our earnings release, we have trending schedules containing supplemental information available on our website. We would like to remind you that certain statements made in today's presentation are forward-looking statements that involve risks and uncertainties. These risks and uncertainties are discussed in more detail in our filings with the SEC.

Some of today's financial remarks will focus on adjusted results. Reconciliations of these non-GAAP financial measures can be found in our earnings release or in our trending schedules, which contain supplemental information and in each case can be found in the Investor Relations section of our website.

With that being said, I would like to thank you for taking the time to join us this afternoon. And now, sit back, relax and enjoy the show.

[Video Presentation] (00:01:08-00:03:23)

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Shari Ellen Redstone

Non-Executive Chairman, ViacomCBS, Inc.

Good afternoon from Kaufman Studios, the original New York home of Paramount Studios. Thank you for joining us and welcome to our investor event. I've never been more excited about the future of this company than I am today. And during today's program, you will see exactly why because we are on the ascent and we are reaching for new heights. Today, we will show you that with the power of our people, the power of our content, and the power of our platforms, we are built to grow to drive shareholder value and to lead our industry forward.

Two years after we brought together Viacom and CBS and one year since we last convened, we are keeping our promises. We are consistently outperforming our goals ahead of schedule, from growth in our subscriber base to growth in brand recognition and growth in operating revenue. We are doing it all faster than anyone expected, and we are delivering win after win after win.

This does not happen by accident. We are winning with one team loaded with talent, creativity and expertise, and one integrated company that is greater than the sum of its parts. We are winning with hits that connect with audiences across all demographics and in markets around the world, and we are winning with our unique differentiated streaming services in free, pay and premium. And of course, I have to give a call out to Paramount+, which in less than a year has established itself as a leading brand in the industry.

Our strategy has always been to harness the strength of our traditional business to build something new with our world-class content fueling our growth. This is what sets us apart as a company and positions us to succeed. We are making the right investments in the right content in the right places, and we are confident based on our track record of successes over the past two years that we can deliver the return on investment that you expect and

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ViacomCBS, Inc. (VIAC)	Corrected Transcript
Q4 2021 Earnings Call - Investor Event	15-Feb-2022

deserve. We have set in motion a virtuous cycle. Our legacy business powers our transformation, and our transformation enhances and expands our legacy.

We have so much to be proud of, so much to be optimistic about, and we are just getting started. The opportunity we see ahead across our brands is my dad's vision come to life, one powerful company that creates content that keeps audiences wanting more. And Paramount was always at the core of this vision. For more than 100 years, Paramount Studios has been known for cinematic excellence, but Paramount is also an idea, a promise to be the best. It is the idea that inspired us to bring together the best in entertainment across CBS, BET, MTV, Nickelodeon, Showtime and more. And it is the idea that inspired our businesses and our brands to define and redefine entertainment again and again for generation after generation.

Indeed, Paramount has always represented brilliant storytelling for audiences around the globe on the big screen, the small screen, and every device in between. It is what we are, it is who we are and it is who we are destined to be. And that is why today, we are thrilled to announce that ViacomCBS has become Paramount Global or simply Paramount.

This afternoon, we invite you to take a closer look at how far we have come, where we are going, and most importantly, how we plan to get there. We want you to take note of the extraordinary progress we have made over the past two years in all the momentum we have gathered and know that there is no higher priority for us and no higher priority for me than unlocking a maximizing value for all of our shareholders.

As I said, I have never had more reasons to be excited about the future of this company, Paramount. And now, I am proud to introduce our President and CEO, Bob Bakish.

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Robert Marc Bakish

President, Chief Executive Officer & Director, ViacomCBS, Inc.

I'm as excited as you are to talk about this company we lead, this company we love, Paramount. The iconic peak of Paramount represents our history as pioneers of the Golden Age of Hollywood. Today, as we embrace this powerful name, we're also pioneers of an exciting new future. And with the momentum we have, Paramount is already reaching new heights.

For more than two decades now, I've witnessed the power of Paramount and all it represents. I've seen, for example, the global impact of Paramount's gripping films like the Mission: Impossible franchise, which sold out time and time again in theaters all around the world. I've seen during my international years how the Paramount channel quickly became among our biggest branded networks in the markets outside United States, and I've seen more recently the audience expanding impact have spiked being rebranded as the Paramount Network in the US, thanks to movies and mega hits like Yellowstone and more.

And now, I think we all see more and more every day the incredible momentum of Paramount+, our flagship streaming service. Our momentum is building. And as it grows, as we take Paramount+ and our other streaming businesses to the next level, the size of the opportunity we see ahead is matched only by the scale of our ambition to seize it.

We can't talk about our momentum without talking about streaming. Just look at the facts. On our paid streaming platforms, we just wrapped our best quarter ever for new subscribers. In fact, our company added 9.4 million new streaming subscribers in Q4 alone, 80% of them on Paramount+. And on Pluto TV, our free, ad-supported streaming television platform, we delivered out-of-this-world results as well. Pluto gained a record 10 million

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ViacomCBS, Inc. (VIAC)	Corrected Transcript
Q4 2021 Earnings Call - Investor Event	15-Feb-2022

monthly active users in Q4, spreading its reach to an audience of nearly 65 million monthly actives. And for full year 2021, it generated over $1 billion in revenue, almost 5 times what it delivered just two years ago.

When it comes to realizing our streaming goals, we're moving fast and gaining even more speed. Already, we are one full year ahead of schedule posting subscriber results we didn't expect to see until next January. And by the end of 2022, we're on track to hit our 2024 subscriber goal, two full years ahead of schedule. This momentum has us leading the industry on multiple fronts.

In Q4, we had the fastest subscriber growth in streaming, and Pluto TV continued to lead its category both in MAUs and revenue. Furthermore, Paramount+ was named the fastest growing brand of 2021 not just in streaming, mind you, but in any industry. And it's not just streaming where we see this momentum. We're firing on all cylinders with number one hits across theatrical, broadcast, cable and streaming. In Q4 alone, we had the top four entertainment programs on all of television, with CBS's NCIS, THE EQUALIZER and FBI, and Paramount Network's Yellowstone. And we had number one shows across countless categories, including the number one comedy with YOUNG SHELDON, the number one news program in 60 MINUTES, the number one kid show in Nickelodeon's PAW Patrol, the number one competition reality show in cable with MTV's THE CHALLENGE, the number one premium show, Showtime's Dexter: New Blood. And this quarter, we became the first studio with two number one films at the Box Office with Scream and Jackass Forever, both of which will debut on Paramount+ in March.

And as we look ahead, powered by our phenomenal Paramount content engine, we see a huge global opportunity in streaming, a much larger potential market that can be captured by television and film alone. We're excited about that opportunity and our ability not just to compete but to thrive, and thereby create significant value for both consumers and shareholders. Why? Because we have a differentiated playbook for streaming success, one that leans into our particular strength that we are broad. And broad in four key ways: across our content, our streaming business model, our mix of platforms and our global reach. This breadth positions us to access a larger accessible market, penetrate it more quickly, and do it all efficiently and sustainably.

So, let's break that down, starting with our bingeworthy, buzzworthy content that's not just rich and deep, but broad and varied. On Paramount+, we take the Plus seriously. We're home to the most diverse content offering in streaming. That enables us to serve the whole household, every generation. From grandparents who were gripped by The Godfather when it premiered in 1972, to preschoolers who were just as excited about PAW Patrol: The Movie in 2022, and we don't just serve the whole household, we serve the whole country, coast to coast. We capture a broad range of households by income and geography. And increasingly, that's a model we're applying all over the world, creating hits in more than a dozen languages.

Over the next year, you'll see us building on that foundation, expanding our success across key genre lanes, scripted and unscripted, sports, news, and events, kids and family, and movies of all kinds. And speaking of movies, I'm pleased to announce that starting with our 2024 releases, Paramount+ will become the streaming home for all new Paramount movies following their theatrical runs. You'll see a similar breadth in our streaming business model, the second source of our advantage. We're proud of our strength in both pay and free streaming, including leading the US market in free, ad-supported streaming television with Pluto TV. We meet consumers, where they're at, serving different segments in different ways and reaching a larger total addressable market in the process. And with the benefit of dual revenue streams in both advertising and subscription, we're maximizing the revenue pool.

Reaching the largest addressable market goes right to the heart of our third advantage, our broad set of platforms spanning linear television, theatrical and streaming. Some see our legacy in each of these platforms as a

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