Nielsen Reports Sluggish Quarter

2-12-2015

Nielsen's revenue missed Wall Street expectations, while the adjusted fourth-quarter 2014 earnings of 79 cents per share was just above the estimates. The sluggish growth was blamed on foreign currency effects and a continued softness in developed markets. Nielsen reported 42 cents a share, compared to last year at 38 cents a share, and profits of $158 million; that was up from $145 million last year. Analysts had been expecting per-share earnings of 80 cents on revenue of $1.66 billion.

Revenue nudged up 1.4 percent to $1.63 billion and, excluding currency effects, it grew at 5.4 percent. Watch business revenues were $725 million, which was 45 percent of total revenue for Nielsen; that was up 2.4 percent year over year. That increase was driven by strength in audience measurement, including digital. Nielsen reported total operating expenses of $672 million, that was down 5 percent from the year-ago figure of $707.0 million.

A number of questions in the earnings call centered around audio measurement and the growth in that market. Nielsen responded that audience measurement is going to be in the 5 to 6 percent growth rate range and audio growth in particular at around 6 percent. Chief Executive Officer Dwight Mitchell Barns also remarked that local business grew with the best rate the company has seen in the past several years in 2014. Barns noted, "We had some new capabilities we brought to the market. Our contract renewals were very solid."

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Advertising Slowing Due to Sluggish Economy.

June 17, 2011

MAGNAGLOBAL, a division of IPG?s Mediabrands, releases an updated US Media Advertising Revenue Forecast yesterday and the news followed right along the lines of all the public radio companies we've been reporting on. The revised report says $173.1 billion dollars of advertising revenues will be generated in 2011, that's an increase of 2.9% over 2010. MAGNAGLOBAL was forecast an increase of 3.1%.  "In light of recent economic reports, excluding the impact of political and Olympic advertising.  While we see the disruption from the earthquake in Japan and high gas prices as temporary, the economy still suffers from a depressed housing market, sluggish employment conditions, and fiscal retrenchment at all levels of government.  Our previous forecasts had already conservatively assumed a slowdown in the second half of 2011."

Here is more from the report:
"A more pronounced shift to National Mass Media can also be seen in the strength of Network TV and Cable advertising.  In total, we expect National TV to grow 7.9% in 2011, up from our previous estimate of 6.5%. Despite upward revisions to National Mass Media, signs of a slowdown are concentrated in Local Mass Media, driven by weakness in Newspapers, Radio and Outdoor advertising.  Direct Media (which incorporates Internet Yellow Pages, Paid Search, Lead Generation, Directories, and Direct Mail) has been particularly impacted by sharper declines in Directories and a slowdown in Direct Mail."

"Online advertising growth exceeded our expectations in the first quarter as the share attributed to national media (primarily reflecting Digital Display and Online Video) was significantly higher than recent trends would have predicted.  Though some premium display publishers may have seen a slowdown stemming from the broader economy, National Online advertising overall benefited significantly from strong momentum in online video and social media as large national advertisers begin to invest more in building brand awareness online."

"Many of these advertisers are also investing more in Paid Search, allowing Direct Online Media to outperform our expectations.  We believe recent improvements made in search quality have benefited the sector and many more monetization opportunities exist in social media.  Online advertising, and Paid Search in particular, was likely helped by continued growth in e-commerce, which accelerated during the first quarter by 17.5% compared to the prior year period.  For 2011, we now expect $30.1 billion in online advertising, up by 15.6% from 2010 levels."

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