Cineverse said it will be cutting streaming channels from its repertoire after reporting rough first-quarter results
Responding to declining revenue, the company said it will cut lower-margin streaming channels in an effort to focus more resources on high-performing channels.
“As we refocus the Company on profitable, sustainable growth driven by technology, we have made significant strides this quarter to reduce operating costs by eliminating unprofitable channels, expanding revenues from our content library, and setting in motion our efforts to dramatically reduce our SG&A costs over the remainder of the fiscal year,” said Erick Opeka, president, and chief strategy officer of Cineverse.
Cineverse hosts one of the largest portfolios of streaming channels and content libraries offered on SVOD, AVOD, and free ad-supported channels. It owns or distributes programs from The Bob Ross Channel, The Carol Burnett Show, Shout TV, Screambox, Midnight Pulp, Comedy Dynamics, Crime Hunters, Bloody Disgusting TV, The Dove Channel, Fandor, and Qwest TV, to name a few.
Cineverse said The El Rey Network, The Country Network, and The Elvis Presley Channel would be nixed. Several proprietary free ad-supported channels will also finalize winding down, including Docurama and CONtv Anime. RetroCrush, Cineverse’s fasting-growing anime channel, will feature CONtv Anime content.
The company posted a net loss of $3.6 million, or 37 cents a share. A year ago, the company lost $6.1 million, or 69 cents a share. The company generated $13 million in revenue, down 4% from a year ago.
However, streaming, digital, and podcast revenues increased by 5.8% this quarter. Paid streaming subscriptions, up 44.7%, fueled this growth to $10.5 million.
“We are making good progress toward our goals of reduced costs, improved margins, and sustained profitability,” said Cineverse Chairman and CEO Chris McGurk. “Despite some continued industry headwinds during the fiscal first quarter, we were pleased to report record revenue in our streaming and digital business despite having fewer channels in our portfolio following our previously announced plan to realign resources in our broad 26-channel streaming portfolio toward higher performing streaming channels.”
Digital distribution revenue jumped up 105.9% to $3.7 million with an increase in new releases and licensing its content to third-party streaming platforms. Cineverse secured 16 channel placements, most notably with Philo, SlingTV, Amazon’s FreeVee, Vix, and Samsung.
Last September, Cinedigm rebranded as Cineverse to focus more on its streaming division. The company transitioned from a cinematic entertainment company to streaming services. At the time, shares were trading at 53 cents each.