AMC Networks Earnings: Streaming and Licensing Growth Offsets Continued Linear Struggles

AMC posted a slightly better-than-expected start to 2023 as revenue was in line with, and adjusted EBITDA strongly beat, FactSet consensus. The bottom-line beat was driven by cost management, particularly at the corporate level. However, the struggles in domestic linear advertising persisted, and we expect the ad market to remain soft. We still believe that AMC does not have the financial resources required to operate as a strictly streaming business, and the Dolan family should consider a sale or merger in the near to medium future. We maintain our $27 fair value estimate.