Time Warner paid $583 million in an all-cash transaction, which gives Hulu a valuation of $5.8 billion. Hulu already streams some of Time Warner’s content. Previous year it introduced its own streaming service, “HBO Now”, and made its content accessible on Dish Network Corp’s DISH.O Sling TV streaming service, which offers a small bundle of channels.
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Time Warner, the second-largest cable provider in the United States, has been fighting to attract younger viewers as more move away from buying cable subscription services in favour of cheaper streaming services.
At the same time, the company said it had struck a deal with Hulu for its suite of cable channels to be carried on Hulu’s forthcoming live streaming TV service.
The new partnership will allow TNT, TBS, CNN, truTV, Cartoon Network, Boomerang, Adult Swim and TCM to be available for live-streaming on Hulu next year.
Time Warner is joining forces with rivals Walt Disney, Comcast and 21st Century Fox as a shareholder in the video streaming company.
On Wednesday, the company reported second-quarter sales gains at both its HBO premium channel and Turner unit on the strength of affiliate revenue, helped by shows like Game of Thrones and the NCAA Men’s Basketbal l National Championship. One a per-share basis, earnings were $1.29, topping the $1.16 predicted by analysts.
The online streaming market is now dominated by giants like Netflix and Amazon Prime, but it’s clear that Time Warner is trying to insert itself more into the game-just not too far. Revenues for the quarter came in at $6.95 billion, against the comparable year-ago figure of $7.35 billion. The media and entertainment giant now expects its 2016 full-year adjusted EPS from continuing operations to be in the range of $5.35 to $5.45.
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Earnings excluding some items were $1.29 a share, New York-based Time Warner said in a statement Wednesday, exceeding the $1.16 average of analysts’ estimates compiled by Bloomberg. But the companies did not specify which Time Warner shows will be added to Hulu’s current offerings of on-demand shows. Time Warner has not only beaten the expectations but has also raised its guidance for the next quarter.
