Viacom's first quarter earnings would have been better if not for Rock Band. Yeah, Viacom, who owns Paramount Pictures, MTV and Comedy Central, posted a 65 percent drop in fiscal first-quarter earnings because of a charge related to the music game brand it unloaded for next to nothing. For the quarter that ended on December 31, Viacom earned $212 million, down from $610 million in the same period a year ago. On the plus side, its revenues rose 3.2 percent to $3.95 billion, but missed analysts’ estimates of $3.99 billion.
The New York-based incurred a charge of $379 million to cover an arbitration award won by the original shareholders of Harmonix Music Systems, which created Rock Band. Viacom acquired Harmonix in 2006, but sold it back to its founders in 2010.
The founders of Harmonix sued, claiming that they were never paid for the performance of "Rock Band" during the height of its popularity. They won an arbitration award of $383 million in December. While Viacom is appealing the ruling, it has set aside the money to cover the award.
Source: Proactive Investors
