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International overtakes US at Discovery

Revenues from Discovery’s international services are now greater than those from the channel operator’s domestic US operations.

David ZaslavDiscovery reported second quarter results yesterday, with the international businesses recording revenues of US$802 million, a 23% increase year-on-year. US revenues slipped into reverse and were down 2% at US$777 million.

Discovery bosses had predicted international revenues would start to eclipse those from the US in the wake of a Europe-focused buying spree that has seen it acquire Eurosport and SBS. It is currently in the throes of buying UK-based producer and distributor All3Media in partnership with Liberty Global.

While international generated greater sales in the quarter, the US remained more profitable although profit of US$460 million was down 1% year on year. The international business recorded a 19% year on year uptick in profit of US$297 million.

Discovery CEO David Zaslav (pictured) told analysts that the company had its best-ever quarter in terms of international viewership, which he said was up 200%.

“Our international business has never been stronger, last year we became the number one pay TV media company in the world but more importantly we have more channels in more countries than any other media company,” Zaslav said.

Amid large-scale mergers amid pay TV operators and consolidation Zaslav also noted that ‘industry consolidation is on everyone’s mind’. Speaking about the mooted Sky UK-Italy-Germany merger he said” “We have 15 channels in the UK we have a very strong relationship with [BSkyB CEO] Jeremy [Darroch], we have been very effective and I think very symbiotic with Sky Italia and with Sky Deutschland.

“I think there is no question consolidation raises issues, the fact that we have significant scale in those markets, I think is very helpful to us.”