India-based media and entertainment company Eros International (NYSE: EROS) reported a net loss for the second quarter of 2020, defying expectations for earnings, even as the global subscribers for its video-on-demand platform, Eros Now, jumped 81% to 23.5 million. The company also reaffirmed its full-year 2020 guidance.
Revenue plunged 49% annually to $32.3 million during the three-month period, far below the Wall Street estimate. Adjusted EBITDA was $7.8 million, down 72% from the year-ago period.
Net loss attributable to equity holders was $27.9 million or 28 cents, compared to a profit of $13.6 million or 17 cents in the second quarter of 2019. Analysts were looking for a modest profit for the latest quarter.
“As we see new players enter the Indian OTT market and international players such as Apple, Disney, Fox and Amazon redoubling their focus on India, we believe our market-leading offering built through years of investment and innovation puts us in a very fortunate position. We are one of the first OTT services to develop in India and are now benefiting from the foresight we had years ago to pioneer the market,” said a statement from the company.
Looking ahead, the management continues to expect consolidated revenue to be in the range of $200 million to $220 million in fiscal 2020, and Adjusted EBITDA between $80 million and $95 million, which is unchanged from the outlook issued earlier.
A few months ago, the company had announced a key partnership with Microsoft (MSFT) for enhancing the content streaming experience for consumers globally. The deal is expected to help the Eros Now platform expand its reach across all markets.
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Eros International shares had a dismal start in 2019 and lost about 83% since the beginning of the year. The stock traded below $2 this week, the lowest level since it started trading in the New York Stock Exchange.