Viaplay has long been presented as a kind of model to follow: a European-style Netflix able to find a place in a streaming market dominated by American giants.
The fall is all the more severe: Viaplay plunged more than 60% on the stock market on Monday, while the platform revised its outlook downwards and changed bosses.
Before the opening of the market, the group announced that it was drastically revising its forecasts for 2023, following “an accelerated deterioration in the operating environment and the expected longer completion of its cost reduction program”. , he explained in a press release.
The group, which expects around 7.7 million subscribers in the summer, said it expected an operating loss in the second quarter. Its advertising revenues are expected to fall by 12% to 16%, given the “brutal and rapid” deterioration of the television and radio advertising markets. At the same time, the increase in the cost of living leads to a decline in subscriptions, as well as unsubscriptions.
For 2023, organic revenue growth should only be 16%-17.5% (compared to 24-26%, during the forecasts announced last November). Operating profit (EBIT) in the Nordics is expected to be between 0.8 and 1 billion Swedish crowns (compared to 1.2 and 1.35 billion expected last fall). The loss at the international level should also widen (1.4-1.5 billion losses, against 1-1.1 initially forecast).
The company, which has established itself on the market thanks to “premium” sports and series and entertainment, has, at the same time, withdrawn its long-term forecasts. She will communicate on July 20.
It’s a real cold snap for investors, while the group, present in thirty countries, seemed to continue its march forward. At the beginning of the year, the company had launched in the United States, suggesting a relatively serene future. Viaplay, which owns linear television channels, had expanded in recent years to several countries. His deposed boss indicated in February to “Echos”, that he was aiming for profitability at the group level this year.
Anders Jensen has resigned and is replaced by Jorgen Madsen Lindermann as Managing Director. This is the former boss of MTG, former parent company of Viaplay.
Viaplay’s earnings warning comes shortly after the company’s presentation was seen as relatively robust during its quarterly earnings results in late April. Admittedly, the group had already issued a warning in October, but “the scale and scope of the latest downward revision will always come as a shock. The same goes for the rapidity of the succession of the CEO”, underlines Giles Thorne, analyst at Jefferies.
Viaplay’s announcement shows the difficulty of finding a place and keeping it in the very competitive streaming market, the growth of which had been boosted by the pandemic. The group prided itself on being the second-largest streaming program provider in the Nordic countries, but it failed to expand profitably outside its home market, as the “Financial Times” recalls .