Citigroup notes that XM Satellite's (XMSR) 1st quarter earnings were slightly better than expected, particularly on the cost side. But, good results will likely be overshadowed this morning by two federal investigations, with a likely overreaction in the stock, which may create a buying opportunity. XMSR's overall effective churn dropped meaningfully in 1st quarter to 2.3% from 3.1% in 4th quarter 2005. Firm says the only guidance XMSR provided was a reiteration that it will achieve 9 million subs and positive cash flow from operations by year end, which was in-line with expectations.
The New York Times reports several big media companies, including the Walt Disney (NYSE:DIS) and CBS (NYSE:CBS) have held meetings with Univision's (Pending:UVN) management over the last week about making a takeover offer for the company.
Comcast (NASDAQ:CMCSA), the leading U.S. cable operator, posted a higher quarterly profit, boosted by increases in digital cable, phone and Internet subscribers. Comcast profit more than tripled to $466 million while revenue rose 10 percent to $5.9 billion. Comcast added 47,000 net new basic video subscribers, 437,000 high-speed data subscribers, and 211,000 digital phone subscribers, which was more than its total additions in 2005.
Hollywood found the Holy Grail when Lara Croft: Tomb Raider hit in 2001, with $131 million and thus Hollywood will continue to mine video games for movie ideas. Today basing a movie on a popular video game is no guarantee for success at the box office, but that isn't stopping Hollywood from playing the adaptation game. Silent Hill scared up the most moviegoers last weekend and made $20.2 million.
The video-game-to-movie pipeline is flush with adaptations in the works and it makes sense because more than half of all Americans play video games and thus it is a gigantic audience that Hollywood cannot ignore. For one, they attract the 18-35 audiences which does not care about movie reviews. I'm not surprised Silent Hill performed so strongly in its debut weekend as the same audience that's going to Blockbuster on a Saturday night are the ones at home playing video games all week long and Hollywood is all about sure things, popcorn and DVD sales.
What slump? With nearly a third of the year behind it, Hollywood is selling movie tickets at a brisk pace, a full $100 million ahead of last year. Through last weekend, 2006 ticket sales are at $2.5 billion, a healthy 4% ahead of last year's number during the same period. Spring has been even healthier: 13% ahead of spring 2005. The fast start gives executives hope that the industry will reverse a three-year attendance slide. Admissions have fallen about 14% since 2002.
Only one movie this year, Ice Age: The Meltdown, has taken in more than $100 million. At this time last year, Hitch, The Pacifier and Robots had hit the blockbuster$100 million mark. The reversal stems more from studios flooding the market. Through the first 16 weekends of the year, there have been 50 wide-release films versus last year’s 39 movies. And with the average big-studio film taking in $38 million at the box office, 11 extra movies "is a big chunk of change.