A month has gone by since the last earnings report for Paramount Skydance (PSKY Quick QuotePSKY - Free Report) . Shares have lost about 20.6% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Paramount Skydance due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for Paramount Skydance Corporation before we dive into how investors and analysts have reacted as of late.

PSKY Misses Q4 Earnings Estimates, Provides Weak Q1 Guidance

Paramount Skydance Corporation reported fourth-quarter 2025 results, wherein both top and bottom lines missed the Zacks Consensus Estimate.

The quarter was the company's first full period under the new management team of Chairman and CEO David Ellison, and management noted it met or exceeded the guidance it had set out in the third-quarter shareholder letter.

On the revenue front, PSKY posted total revenues of $8.14 billion, narrowly missing the consensus mark by 0.32%. Results fell within the company's guidance range of $8.10-$8.30 billion. 

PSKY's fourth-quarter 2025 revenues represented 2% year-over-year growth, driven by continued Direct-to-Consumer momentum, partially offset by ongoing secular headwinds in the TV Media segment.

PSKY reported a GAAP net loss of $573 million, or a loss of 52 cents per share, in the fourth quarter. Excluding restructuring, severance, transaction-related costs and other items, adjusted loss came in at 12 cents per share, wider than the Zacks Consensus Estimate of a loss of 2 cents. The year-ago quarter had posted an adjusted loss of 11 cents per share.

PSKY's Financial Performance Overview

GAAP operating loss totaled $339 million in the fourth quarter of 2025 compared with operating income of $337 million in fourth-quarter 2024. The year-over-year swing reflected $465 million in restructuring and severance charges, $81 million in transaction-related fees, and $41 million in content abandonment charges — all excluded from the company's adjusted profitability measure.

Adjusted OIBDA reached $612 million in the fourth quarter of 2025, which increased 51% year over year and came above PSKY's guided range of $500-$600 million. The result demonstrated strong cost discipline across its legacy media businesses, even as the company absorbs integration and transformation costs.

For full-year 2025, PSKY delivered revenues approaching $29 billion and adjusted OIBDA of approximately $3 billion (10% margin), broadly in line with its prior guidance.

PSKY's Q4 Segment Performance Details

The DTC segment posted revenues of $2.21 billion, up 10% year over year. Paramount+ specifically continued its strong trajectory with revenues of $1.837 billion, up 17% year over year. Paramount+ ended 2025 with approximately 79 million paid subscribers.

Non-Paramount+ revenues (primarily Pluto TV) declined 16% year over year, reflecting monetization headwinds even as Pluto TV's monthly active user engagement increased. Segment Adjusted OIBDA swung to a loss of $158 million in the fourth quarter against the $340 million profit posted in third-quarter 2025, reflecting the high-cost content investment cycle inherent in the streaming business.

The TV Media segment reported revenues of $4.71 billion, down approximately 5% year over year, consistent with industry-wide secular trends in cord-cutting and linear advertising.

Despite the revenue decline, TV Media demonstrated strong cost discipline, with Adjusted OIBDA surging 14.7% year over year to $1.09 billion, a standout result that highlights management's operational efficiency gains. CBS maintained its position as the most-watched broadcast network for the 17th consecutive year.

The Filmed Entertainment segment reported revenue growth of approximately 16% year over year. However, the segment posted an Adjusted OIBDA loss in the quarter, reflecting the underperformance of the 2025 theatrical slate and the company's acknowledgment that it stepped into a pre-existing weak film lineup.

Management noted the studio is in a rebuild phase, with meaningful profitability improvements not expected until 2027. PSKY plans to scale from 8 to 16 theatrical releases in 2026, doubling down on franchises, such as A Quiet Place and Sonic the Hedgehog.

PSKY’s Q4 Balance Sheet and Cash Flow Details

As of Dec. 31, 2025, cash and cash equivalents totaled $3.3 billion, up from $2.74 billion as of June 30, 2025. Total gross debt was pinned at $13.7 billion.

The company continues to target investment-grade debt metrics by the end of 2027, underpinned by expected efficiency savings of at least $3 billion through 2027, with more than $2.5 billion in run-rate efficiencies anticipated by year-end 2026.

PSKY Offers Q1 and Full-Year 2026 Outlook

For the first quarter of 2026, PSKY expects total revenues of $7.15-$7.35 billion, indicating flat to modest growth year over year, pointing to persistent declines in its traditional television business even as it forecasts strong momentum in streaming this year.

For full-year 2026, management reaffirmed its target of $30 billion in total revenues, suggesting approximately 4% year-over-year growth. The company expects adjusted EBITDA of $3.8 billion, equating to a 12.7% margin, representing approximately 27% growth in profitability year over year. PSKY is transitioning from adjusted OIBDA to adjusted EBITDA as its primary non-GAAP profitability metric starting in 2026, with the key difference being the exclusion of stock-based compensation.

DTC is expected to be the primary growth driver, with Paramount+ subscriber and revenue growth accelerating in 2026, aided by price increases and improving advertising revenues. The company plans to exit approximately four to five million hard-bundle subscribers with unattractive economics (less than 2% of Paramount+ 2025 revenues), which will modestly weigh on reported subscriber counts but improve per-subscriber economics.

Projected free cash flow remains approximately $1.5 billion before roughly $800 million in non-recurring transformation costs. PSKY also separately noted its ongoing bid to acquire Warner Bros. Discovery at $30 per share in an all-cash transaction, which the company characterized as an accelerant to its standalone strategy.

How Have Estimates Been Moving Since Then?

Since the earnings release, investors have witnessed a flat trend in fresh estimates.

The consensus estimate has shifted 23.14% due to these changes.

VGM Scores

At this time, Paramount Skydance has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a score of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Paramount Skydance has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.