Media earnings are out, and some analysts are saying the results point to a media recovery. From Reuters:
Investors who bought media stocks 12 months ago made a smart bet... All have outperformed the Standard & Poor's 500.
Still, no traditional media company has solved fundamental problems. Establishing a sustainable digital business remains tough. Publishing is still in decline. As Benchmark Co analyst Fred Moran said, "advertising is only getting less bad."
Time Warner reported a profit of $627 million, a 32% increase over last year, while News Corp. revenue was up 10%, raising its earnings outlook for the rest of the fiscal year. Meanwhile, Comcast said its quarterly profit more than doubled from the year-earlier period, earning $955 million this past quarter.
Insiders pointed to big blockbuster films and strong DVD sales as reason for the promising numbers. In 2009, Time Warner raked in hits like "Sherlock Holmes" and "The Blind Side," and News Corp.'s Fox did well in DVD sales for "X-Men Origins: Wolverine" and "Night at the Museum: Battle of the Smithsonian." Fox News contributed heavily to the positive results, and News Corp.'s newspaper business also increased revenues and operating income.