UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
x☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2017March 31, 2023
OR
o☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________
Commission File Number 001-09553
CBS CORPORATIONParamount Global
(Exact name of registrant as specified in its charter)
Delaware
04-2949533
(State or other jurisdiction of

incorporation or organization)
04-2949533
(I.R.S. Employer Identification No.)
51 W. 52nd Street, 1515 Broadway
New York,New York
10036
(Address of principal executive offices)
10019
(Zip Code)
(212) 975-4321258-6000
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolsName of each exchange on which registered
Class A Common Stock, $0.001 par valuePARAAThe Nasdaq Stock Market LLC
Class B Common Stock, $0.001 par valuePARAThe Nasdaq Stock Market LLC
5.75% Series A Mandatory Convertible Preferred Stock, $0.001 par valuePARAPThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesx☒    No o☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x☒    No o☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerx
☒
Accelerated filer o
☐
Non-accelerated filero
☐
Smaller reporting companyo
☐
Emerging growth companyo☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o☐    No x☒
Number of shares of common stock outstanding at October 31, 2017:May 1, 2023:
Class A Common Stock, par value $.001 per share— 37,598,60440,704,341
Class B Common Stock, par value $.001 per share— 362,580,107
610,852,890





CBS CORPORATIONPARAMOUNT GLOBAL
INDEX TO FORM 10-Q
Page
PART I – FINANCIAL INFORMATION
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PART I – FINANCIAL INFORMATION
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Item 1.
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Item 1A.
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6251




PART I – FINANCIAL INFORMATION
Item 1.Financial Statements.
CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; in millions, except per share amounts)
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
Revenues$3,171
 $3,084
 $9,771
 $9,648
Costs and expenses: 
  
    
Operating1,862
 1,788
 5,940
 5,818
Selling, general and administrative547
 521
 1,585
 1,534
Depreciation and amortization55
 54
 166
 168
Other operating items, net—
 —
 —
 (9)
Total costs and expenses2,464
 2,363
 7,691
 7,511
Operating income707
 721
 2,080
 2,137
Interest expense(116) (104) (336) (304)
Interest income17
 7
 45
 22
Loss on early extinguishment of debt (Note 6)(5) —
 (5) —
Other items, net3
 —
 9
 (7)
Earnings from continuing operations before income taxes and
equity in loss of investee companies
606
 624
 1,793
 1,848
Provision for income taxes(172) (145) (479) (524)
Equity in loss of investee companies, net of tax(16) (13) (45) (43)
Net earnings from continuing operations418
 466
 1,269
 1,281
Net earnings (loss) from discontinued operations, net of tax (Note 3)174
 12
 (871) 93
Net earnings$592
 $478
 $398
 $1,374
        
Basic net earnings (loss) per common share: 
  
    
Net earnings from continuing operations$1.04

$1.05

$3.13

$2.84
Net earnings (loss) from discontinued operations$.43

$.03

$(2.15)
$.21
Net earnings$1.48

$1.08

$.98

$3.05
        
Diluted net earnings (loss) per common share: 
  
    
Net earnings from continuing operations$1.03

$1.04

$3.10

$2.82
Net earnings (loss) from discontinued operations$.43

$.03

$(2.12)
$.20
Net earnings$1.46

$1.07

$.97

$3.02
        
Weighted average number of common shares outstanding: 
  
    
Basic401
 442
 405
 451
Diluted406

446

410

455
        
Dividends per common share$.18
 $.18
 $.54
 $.48
Three Months Ended
March 31,
20232022
Revenues$7,265 $7,328 
Costs and expenses:
Operating4,964 4,796 
Programming charges1,674 — 
Selling, general and administrative1,753 1,619 
Depreciation and amortization100 96 
Restructuring and other corporate matters— 57 
Total costs and expenses8,491 6,568 
Gain on dispositions— 15 
Operating income (loss)(1,226)775 
Interest expense(226)(240)
Interest income35 21 
Loss on extinguishment of debt— (73)
Other items, net(46)(13)
Earnings (loss) from continuing operations before income taxes and
   equity in loss of investee companies		(1,463)470 
Benefit (provision) for income taxes381 (34)
Equity in loss of investee companies, net of tax(75)(37)
Net earnings (loss) from continuing operations(1,157)399 
Net earnings from discontinued operations, net of tax45 42 
Net earnings (loss) (Paramount and noncontrolling interests)(1,112)441 
Net earnings attributable to noncontrolling interests(6)(8)
Net earnings (loss) attributable to Paramount$(1,118)$433 
Amounts attributable to Paramount:
Net earnings (loss) from continuing operations$(1,163)$391 
Net earnings from discontinued operations, net of tax45 42 
Net earnings (loss) attributable to Paramount$(1,118)$433 
Basic net earnings (loss) per common share attributable to Paramount:
Net earnings (loss) from continuing operations$(1.81)$.58 
Net earnings from discontinued operations$.07 $.06 
Net earnings (loss)$(1.74)$.65 
Diluted net earnings (loss) per common share attributable to Paramount:
Net earnings (loss) from continuing operations$(1.81)$.58 
Net earnings from discontinued operations$.07 $.06 
Net earnings (loss)$(1.74)$.64 
Weighted average number of common shares outstanding:
Basic651 649 
Diluted651 651 
See notes to consolidated financial statements.

-3-


CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited; in millions)
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
Net earnings$592
 $478
 $398
 $1,374
Other comprehensive income, net of tax:       
Cumulative translation adjustments2
 1
 4
 2
Amortization of net actuarial loss and prior service cost13
 10
 37
 29
Total other comprehensive income, net of tax15
 11
 41
 31
Total comprehensive income$607

$489

$439

$1,405
Three Months Ended
March 31,
20232022
Net earnings (loss) (Paramount and noncontrolling interests)$(1,112)$441 
Other comprehensive income (loss), net of tax:
Cumulative translation adjustments53 (40)
Decrease to net actuarial loss and prior service costs11 16 
Other comprehensive income (loss) from continuing operations,
net of tax (Paramount and noncontrolling interests)		64 (24)
Other comprehensive income from discontinued operations2 2 
Comprehensive income (loss)(1,046)419 
Less: Comprehensive income attributable to noncontrolling interests7 8 
Comprehensive income (loss) attributable to Paramount$(1,053)$411 
See notes to consolidated financial statements.



-4-
CBS CORPORATION

PARAMOUNT GLOBAL AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited; in millions, except per share amounts)
 At At
 September 30, 2017 December 31, 2016
ASSETS       
Current Assets:       
Cash and cash equivalents $144
   $598
 
Receivables, less allowances of $48 (2017) and $60 (2016) 3,598
   3,314
 
Programming and other inventory (Note 4) 1,830
   1,427
 
Prepaid income taxes —
   30
 
Prepaid expenses 182
   185
 
Other current assets 185
   204
 
Current assets of discontinued operations (Note 3) 355
   305
 
Total current assets 6,294
   6,063
 
Property and equipment 3,001
   2,935
 
Less accumulated depreciation and amortization 1,793
   1,694
 
Net property and equipment 1,208
   1,241
 
Programming and other inventory (Note 4) 2,814
   2,439
 
Goodwill 4,891
   4,864
 
Intangible assets 2,617
   2,633
 
Other assets 2,745
   2,707
 
Assets of discontinued operations (Note 3) 3,325
   4,291
 
Total Assets $23,894



$24,238
 
        
LIABILITIES AND STOCKHOLDERS’ EQUITY
 

   

 
Current Liabilities: 

   

 
Accounts payable $233
   $148
 
Accrued compensation 257
   369
 
Participants’ share and royalties payable 997
   1,024
 
Program rights 509
   290
 
Income taxes payable 55
   —
 
Commercial paper (Note 6) 590
   450
 
Current portion of long-term debt (Note 6) 19
   23
 
Accrued expenses and other current liabilities 1,238
   1,249
 
Current liabilities of discontinued operations (Note 3) 154
   155
 
Total current liabilities 4,052
   3,708
 
Long-term debt (Note 6) 9,080
   8,902
 
Pension and postretirement benefit obligations 1,619
   1,769
 
Deferred income tax liabilities, net 645
   590
 
Other liabilities 3,038
   3,129
 
Liabilities of discontinued operations (Note 3) 2,466
   2,451
 
  

   

 
Commitments and contingencies (Note 10) 

   

 
  

   

 
Stockholders’ Equity:
 

   

 
Class A Common Stock, par value $.001 per share; 375 shares authorized;
 38 (2017 and 2016) shares issued		 —
   —
 
Class B Common Stock, par value $.001 per share; 5,000 shares authorized;
 833 (2017) and 829 (2016) shares issued		 1
   1
 
Additional paid-in capital 43,830
   43,913
 
Accumulated deficit (18,859)   (19,257) 
Accumulated other comprehensive loss (Note 8) (726)   (767) 
  24,246
   23,890
 
Less treasury stock, at cost; 471 (2017) and 455 (2016) Class B shares 21,252
   20,201
 
Total Stockholders’ Equity
 2,994
   3,689
 
Total Liabilities and Stockholders’ Equity
 $23,894
   $24,238
 
AtAt
March 31, 2023December 31, 2022
ASSETS
Current Assets:
Cash and cash equivalents$2,109 $2,885 
Receivables, net7,448 7,412 
Programming and other inventory1,085 1,342 
Prepaid expenses and other current assets1,364 1,308 
Current assets of discontinued operations651 787 
Total current assets12,657 13,734 
Property and equipment, net1,718 1,762 
Programming and other inventory15,692 16,278 
Goodwill16,511 16,499 
Intangible assets, net2,688 2,694 
Operating lease assets1,363 1,391 
Deferred income tax assets, net1,286 1,242 
Other assets3,848 3,991 
Assets of discontinued operations798 802 
Total Assets$56,561 $58,393 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable$1,235 $1,403 
Accrued expenses1,760 2,071 
Participants’ share and royalties payable2,421 2,416 
Accrued programming and production costs2,425 2,063 
Deferred revenues1,092 973 
Debt240 239 
Other current liabilities1,642 1,477 
Current liabilities of discontinued operations480 549 
Total current liabilities11,295 11,191 
Long-term debt15,613 15,607 
Participants’ share and royalties payable1,665 1,744 
Pension and postretirement benefit obligations1,454 1,458 
Deferred income tax liabilities, net668 1,077 
Operating lease liabilities1,398 1,428 
Program rights obligations326 367 
Other liabilities1,603 1,715 
Liabilities of discontinued operations196 200 
Commitments and contingencies (Note 13)
Paramount stockholders’ equity:
5.75% Series A Mandatory Convertible Preferred Stock, par value $.001 per share;
    25 shares authorized; 10 (2023 and 2022) shares issued
— — 
Class A Common Stock, par value $.001 per share; 55 shares authorized;
41 (2023 and 2022) shares issued
— — 
Class B Common Stock, par value $.001 per share; 5,000 shares authorized;
1,113 (2023) and 1,112 (2022) shares issued
1 1 
Additional paid-in capital33,087 33,063 
Treasury stock, at cost; 503 (2023 and 2022) shares of Class B Common Stock(22,958)(22,958)
Retained earnings13,463 14,737 
Accumulated other comprehensive loss(1,742)(1,807)
Total Paramount stockholders’ equity21,851 23,036 
Noncontrolling interests492 570 
Total Equity22,343 23,606 
Total Liabilities and Equity$56,561 $58,393 
See notes to consolidated financial statements.

-5-
CBS CORPORATION

PARAMOUNT GLOBAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; in millions)
 Nine Months Ended
 September 30,
 2017 2016
Operating Activities:   
Net earnings$398
 $1,374
Less: Net earnings (loss) from discontinued operations, net of tax(871) 93
Net earnings from continuing operations1,269

1,281
Adjustments to reconcile net earnings from continuing operations to net cash flow
provided by operating activities from continuing operations:





Depreciation and amortization166

168
Stock-based compensation129

123
Equity in loss of investee companies, net of tax and distributions45

48
Change in assets and liabilities, net of investing and financing activities(674)
(503)
Net cash flow provided by operating activities from continuing operations935

1,117
Net cash flow provided by operating activities from discontinued operations52

189
Net cash flow provided by operating activities987

1,306
Investing Activities:




Acquisitions (including acquired television library)(258) (51)
Capital expenditures(112)
(111)
Investments in and advances to investee companies(67)
(44)
Proceeds from sale of investments10
 —
Proceeds from dispositions11

20
Other investing activities17
 7
Net cash flow used for investing activities from continuing operations(399)
(179)
Net cash flow used for investing activities from discontinued operations(18)
(2)
Net cash flow used for investing activities(417)
(181)
Financing Activities:




Proceeds from short-term debt borrowings, net140

33
Proceeds from issuance of senior notes889
 685
Repayment of senior notes and debentures(701) (199)
Proceeds from debt borrowings of CBS Radio40
 —
Repayment of debt borrowings of CBS Radio(23) —
Payment of capital lease obligations(13)
(13)
Payment of contingent consideration(7) —
Dividends(224)
(209)
Purchase of Company common stock(1,111)
(1,534)
Payment of payroll taxes in lieu of issuing shares for stock-based compensation(89)
(57)
Proceeds from exercise of stock options81

13
Excess tax benefit from stock-based compensation (Note 1)—

13
Other financing activities—
 (1)
Net cash flow used for financing activities(1,018)
(1,269)
Net decrease in cash and cash equivalents(448)
(144)
Cash and cash equivalents at beginning of period
(includes $24 (2017) and $6 (2016) of discontinued operations cash)
622

323
Cash and cash equivalents at end of period
(includes $30 (2017) and $1 (2016) of discontinued operations cash)
$174

$179
Supplemental disclosure of cash flow information




Cash paid for interest:   
Continuing operations$393
 $358
Discontinued operations$52
 $—
    
Cash paid for income taxes:   
Continuing operations$321
 $310
Discontinued operations$58
 $60
Three Months Ended
March 31,
20232022
Operating Activities:
Net earnings (loss) (Paramount and noncontrolling interests)$(1,112)$441 
Less: Net earnings from discontinued operations, net of tax45 42 
Net earnings (loss) from continuing operations(1,157)399 
Adjustments to reconcile net earnings (loss) from continuing operations to net cash flow
   (used for) provided by operating activities from continuing operations:
Depreciation and amortization100 96 
Programming charges1,674 — 
Deferred tax benefit(436)(62)
Stock-based compensation39 36 
Gain on dispositions— (15)
Loss on extinguishment of debt— 73 
Equity in loss of investee companies, net of tax75 37 
Change in assets and liabilities(778)(269)
Net cash flow (used for) provided by operating activities from continuing operations(483)295 
Net cash flow provided by operating activities from discontinued operations105 102 
Net cash flow (used for) provided by operating activities(378)397 
Investing Activities:
Investments(43)(59)
Capital expenditures(71)(52)
Other investing activities25 31 
Net cash flow used for investing activities(89)(80)
Financing Activities:
Proceeds from issuance of notes and debentures— 991 
Repayment of notes and debentures— (2,001)
Dividends paid on preferred stock(14)(14)
Dividends paid on common stock(166)(158)
Payment of payroll taxes in lieu of issuing shares for stock-based compensation(16)(9)
Payments to noncontrolling interests(89)(77)
Other financing activities(27)(3)
Net cash flow used for financing activities(312)(1,271)
Effect of exchange rate changes on cash and cash equivalents3 (11)
Net decrease in cash and cash equivalents(776)(965)
Cash and cash equivalents at beginning of year2,885 6,267 
Cash and cash equivalents at end of period$2,109 $5,302 
See notes to consolidated financial statements.

-6-


CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited; in millions)
Three Months Ended March 31, 2023
Preferred StockClass A and B Common StockAdditional Paid-In CapitalTreasury
Stock		Retained EarningsAccumulated Other Comprehensive LossTotal Paramount Stockholders’ EquityNoncontrolling InterestsTotal Equity
(Shares)(Shares)
December 31, 202210 $— 650 $1 $33,063 $(22,958)$14,737 $(1,807)$23,036 $570 $23,606 
Stock-based
compensation
activity and other		— — 1 — 24 — 19 — 43 — 43 
Preferred stock
dividends		— — — — — — (14)— (14)— (14)
Common stock
dividends		— — — — — — (161)— (161)— (161)
Noncontrolling
interests		— — — — — — — — — (85)(85)
Net earnings (loss)— — — — — — (1,118)— (1,118)6 (1,112)
Other comprehensive
income
— — — — — — — 65 65 1 66 
March 31, 202310 $— 651 $1 $33,087 $(22,958)$13,463 $(1,742)$21,851 $492 $22,343 
Three Months Ended March 31, 2022
Preferred StockClass A and B Common StockAdditional Paid-In CapitalTreasury
Stock		Retained EarningsAccumulated Other Comprehensive LossTotal Paramount Stockholders’ EquityNoncontrolling InterestsTotal Equity
(Shares)(Shares)
December 31, 202110 $— 648 $1 $32,918 $(22,958)$14,343 $(1,902)$22,402 $568 $22,970 
Stock-based
compensation
activity
— — 1 — 28 — — — 28 — 28 
Preferred stock
dividends		— — — — — — (14)— (14)— (14)
Common stock
dividends		— — — — — — (159)— (159)— (159)
Noncontrolling
interests		— — — — — — (4)— (4)(83)(87)
Net earnings— — — — — — 433 — 433 8 441 
Other comprehensive
loss		— — — — — — — (22)(22)— (22)
March 31, 202210 $— 649 $1 $32,946 $(22,958)$14,599 $(1,924)$22,664 $493 $23,157 
See notes to consolidated financial statements.
-7-


PARAMOUNT GLOBAL AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Tabular dollars in millions, except per share amounts)


1) BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Description of Business-Business—Paramount Global, a global media, streaming and entertainment company that creates premium content and experiences for audiences worldwide, is comprised of the following segments:

•TV Media—Our TV Media segment consists of our (1) broadcast operations—the CBS Corporation (together withTelevision Network, our domestic broadcast television network; CBS Stations, our owned television stations; and our international free-to-air networks, Network 10, Channel 5, Telefe, and Chilevisión; (2) premium and basic cable networks, including Showtime, MTV, Comedy Central, Paramount Network, The Smithsonian Channel, Nickelodeon, BET Media Group, CBS Sports Network, and international extensions of certain of these brands; (3) domestic and international television studio operations, including CBS Studios, Paramount Television Studios and MTV Entertainment Studios, as well as CBS Media Ventures, which produces and distributes first-run syndicated programming. TV Media also includes a number of digital properties such as CBS News Streaming and CBS Sports HQ.

•Direct-to-Consumer—Our Direct-to-Consumer segment consists of our portfolio of domestic and international pay and free streaming services, including Paramount+, Pluto TV, Showtime Networks’ premium subscription streaming service (Showtime OTT), BET+ and Noggin.

•Filmed Entertainment—Our Filmed Entertainment segment consists of Paramount Pictures, Paramount Players, Paramount Animation, Nickelodeon Studio, Awesomeness and Miramax.

In January 2023, we announced that we will be fully integrating Showtime into Paramount+ across both streaming and linear platforms later in the year.

References to “Paramount,” the “Company,” “we,” “us” and “our” refer to Paramount Global and its consolidated subsidiaries, unless the context otherwise requires, the “Company” or “CBS Corp.”) is comprised of the following segments: Entertainment (CBS Television, comprised of the CBS Television Network, CBS Television Studios, CBS Studios International, and CBS Television Distribution; CBS Interactive and CBS Films), Cable Networks (Showtime Networks, CBS Sports Network and Smithsonian Networks), Publishing (Simon & Schuster) and Local Media (CBS Television Stations and CBS Local Digital Media).requires.


Pending Acquisition-On August 27, 2017, the Company signed a binding agreement to acquire Ten Networks Holdings Limited (“Network Ten”), one of three major commercial broadcast networks in Australia, after Network Ten entered into voluntary administration. During the third quarter of 2017, the Company paid $138 million of the purchase price, primarily for the assumption of the secured debt of Network Ten’s lenders, and funding for working capital. The transaction, which is expected to close in the fourth quarter of 2017, will be completed in accordance with Australian applicable laws and procedures and is subject to certain regulatory approvals.

Discontinued Operations-On February 2, 2017, the Company entered into an agreement with Entercom Communications Corp. (“Entercom”) to combine the Company’s radio business, CBS Radio Inc. (“CBS Radio”), with Entercom in a merger to be effected through a Reverse Morris Trust transaction, which is expected to be tax-free to CBS Corp. and its stockholders. In connection with this transaction, on October 19, 2017, the Company commenced an exchange offer through which it will split-off CBS Radio (See Note 3). CBS Radio has been presented as a discontinued operation in the Company’s consolidated financial statements for all periods presented.

Basis of Presentation-ThePresentation—The accompanying unaudited consolidated financial statements of the Company have been prepared on a basis consistent with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and pursuant to the rules of the Securities and Exchange Commission.Commission (SEC). These financial statements should be read in conjunction with the more detailed financial statements and notes thereto included in the Company’sour Annual Report on Form 10-K for the year ended December 31, 2016.2022.


In the opinion of management, the accompanying unaudited consolidated financial statements reflect all adjustments, consisting only of normal and recurring adjustments, necessary for a fair statement of theour financial position, results of operations and cash flows of the Company for the periods presented. Certain previously reported amounts have been reclassified to conform to the current presentation.


Discontinued Operations—In the fourth quarter of 2020, we entered into an agreement to sell our publishing business, Simon & Schuster, which was previously reported as the Publishing segment and as a result, we began presenting Simon and Schuster as a discontinued operation. In the fourth quarter of 2022, we terminated the agreement after the U.S. Department of Justice prevailed in its suit to block the sale. Simon & Schuster remains a noncore asset as it does not fit strategically within our video-based portfolio. We expect to enter into a new agreement to sell Simon & Schuster in 2023. Assuming that we do so, closing would be subject to closing conditions that would include regulatory approval. Simon & Schuster continues to be presented as a discontinued operation for all periods presented (see Note 2).

-8-


PARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)
Use of Estimates-TheEstimates—The preparation of the Company’sour consolidated financial statements in conformity with accounting principles generally accepted in the United StatesGAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosurethe disclosures of contingent assets and liabilities atas of the date of the financial statements and the reported amountamounts of revenues and expenses during the reporting period. The Company bases itsperiods presented. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differvary from these estimates under different assumptions or conditions.


Other Operating Items, Net-Other operating items, net for the nine months ended September 30, 2016 included a gain from the sale of a business and a multiyear, retroactive impact of a new operating tax.

Net Earnings (Loss) per Common Share-BasicShare—Basic net earnings (loss) per share (“EPS”) is based upon net earnings (loss) available to common stockholders divided by the weighted average number of common shares outstanding during the period. DilutedNet earnings (loss) available to common stockholders is calculated as net earnings (loss) from continuing operations or net earnings (loss), as applicable, adjusted to include a reduction for dividends recorded during the applicable period on our 5.75% Series A Mandatory Convertible Preferred Stock (“Mandatory Convertible Preferred Stock”).

Weighted average shares for diluted EPS reflects the effect of the assumed exercise of stock options and vesting of restricted stockshare units (“RSUs”) and


CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

market-basedor performance share units (“PSUs”) only in the periods in which such effect would have been dilutive. ExcludedDiluted EPS also reflects the effect of the assumed conversion of preferred stock, if dilutive, which includes the issuance of common shares in the weighted average number of shares and excludes the above-mentioned preferred stock dividend adjustment to net earnings (loss) available to common stockholders.

For the three months ended March 31, 2023, stock options and RSUs of 21 million were excluded from the calculation of diluted EPS because their inclusion would have been anti-dilutive, were 4 millionantidilutive since we reported a net loss. For the three months ended March 31, 2022, stock options and RSUs of 6 million were excluded from the calculation of diluted EPS because their inclusion would have been antidilutive. Also excluded from the calculation of diluted EPS for each period was the effect of the three and nine months endedSeptember 30, 2017 and 5assumed conversion of 10 million shares of Mandatory Convertible Preferred Stock into shares of common stock options for each ofbecause the three and nine months endedSeptember 30, 2016.

impact would have been antidilutive. The table below presents a reconciliation of weighted average shares used in the calculation of basic and diluted EPS.
Three Months Ended
March 31,
(in millions)20232022
Weighted average shares for basic EPS651 649 
Dilutive effect of shares issuable under stock-based
compensation plans
— 2 
Weighted average shares for diluted EPS651 651 
 Three Months Ended Nine Months Ended
 September 30, September 30,
(in millions)2017 2016 2017 2016
Weighted average shares for basic EPS401
 442
 405
 451
Dilutive effect of shares issuable under stock-based
compensation plans
5
 4
 5
 4
Weighted average shares for diluted EPS406
 446
 410
 455
Other Liabilities-Other liabilities consist primarily of the noncurrent portion of residual liabilities of previously disposed businesses, participants’ share and royalties payable, program rights obligations, deferred compensation and other employee benefit accruals.

Additional Paid-In Capital-For the nine months ended September 30, 2017 and 2016, the Company recorded dividends of $221 million and $218 million, respectively, as a reduction to additional paid-in capital as the Company had an accumulated deficit balance.

Adoption of New Accounting Standards
Improvements to Employee Share-Based Payment Accounting
During the first quarter of 2017, the Company adopted amended Financial Accounting Standards Board (“FASB”) guidance which simplifies several aspects of the accounting for employee share-based payment transactions. Under this amended guidance, all excess tax benefits and tax deficiencies are recognized as income tax expense or benefit in the income statement in the period in which the awards vest or are exercised. In the statement of cash flows, excess tax benefits are classified with other income tax cash flows in operating activities. As a result of the adoption of this guidance, the Company’s excess tax benefits associated with the exercise of stock options and vesting of RSUs for the three and nine months endedSeptember 30,2017 were recorded in the provision for income taxes on the Consolidated Statements of Operations. The guidance requires the income statement classification to be applied prospectively, and therefore, excess tax benefits for prior periods remain classified in stockholders’ equity on the balance sheet. The Company elected to apply the cash flow classification provision of this guidance prospectively and therefore, excess tax benefits for prior periods remain classified as financing activities on the statements of cash flows. The amended guidance also gives the option to make a policy election to account for forfeitures as they occur. The Company, however, has elected to continue its existing practice of estimating forfeitures.

Simplifying the Accounting for Goodwill Impairment
During the first quarter of 2017, the Company early adopted amended FASB guidance which simplifies the accounting for goodwill impairment. This guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. Under the amended guidance, a goodwill impairment charge is recognized for the amount by which the carrying value of a reporting unit exceeds its fair value, not to exceed the carrying amount of goodwill.

-9-



CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

Recent Pronouncements
Targeted ImprovementsAdditionally, because the impact of the assumed conversion of the Mandatory Convertible Preferred Stock would have been antidilutive, net earnings (loss) from continuing operations and net earnings (loss) used in our calculation of diluted EPS for the three months ended March 31, 2023 and 2022 include a reduction for the preferred stock dividends recorded during each period. The table below presents a reconciliation of net earnings (loss) from continuing operations and net earnings (loss) to Accounting for Hedging Activities
In August 2017, the FASB issued amended guidance for hedge accounting, which expands the eligibility of hedging strategies that qualify for hedge accounting, modifies the recognition and presentation of hedgesamounts used in the financial statements,calculations of basic and changes how companies assess hedge effectiveness. In addition, this guidance amendsdiluted EPS.
Three Months Ended
March 31,
20232022
Amounts attributable to Paramount:
Net earnings (loss) from continuing operations$(1,163)$391 
Preferred stock dividends(14)(14)
Net earnings (loss) from continuing operations for basic and
   diluted EPS calculation
$(1,177)$377 
Amounts attributable to Paramount:
Net earnings (loss)$(1,118)$433 
Preferred stock dividends(14)(14)
Net earnings (loss) for basic and diluted EPS calculation$(1,132)$419 
2) DISCONTINUED OPERATIONS
The following table sets forth details of net earnings from discontinued operations for the three months ended March 31, 2023 and expands disclosure requirements. This guidance,2022, which is effectiveprimarily reflects the results of Simon & Schuster (See Note 1).
Three Months Ended
March 31,
20232022
Revenues$258 $217 
Costs and expenses:
Operating151 124 
Selling, general and administrative45 38 
Total costs and expenses (a)
196 162 
Operating income62 55 
Other items, net(3)(1)
Earnings from discontinued operations59 54 
Provision for income taxes (b)
(14)(12)
Net earnings from discontinued operations, net of tax$45 $42 
(a) Included in total costs and expenses are amounts associated with the release of indemnification obligations for interimleases relating to a previously disposed business of $4 million and annual periods beginning after December 15, 2018, with early adoption permitted, is not expected$5 million for the three months ended March 31, 2023 and 2022, respectively.
(b) The tax provision includes amounts relating to have a material impact on the Company’s consolidated financial statements.
Stock Compensation: Scopepreviously disposed businesses of Modification Accounting
In May 2017, the FASB issued amended guidance on the accounting$1 million for stock-based compensation which clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under this guidance, modification accounting is required only if the fair value, the vesting conditions, or the classificationeach of the award as equity or liability changes as a result of the change in the terms or conditions of a share-based payment award. This guidance, which is effective for interimthree months ended March 31, 2023 and annual periods beginning after December 15, 2017, with early adoption permitted, is not expected to have an impact on the Company’s consolidated financial statements.
Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost
In March 2017, the FASB issued amended guidance on the presentation of net periodic pension and postretirement benefit cost (“net benefit cost”). This guidance requires an employer to present on the statement of operations the service cost component of net benefit cost in the same line item(s) as other compensation costs of the related employees. The other components of net benefit cost will be presented in the statement of operations separately from the service cost component and below the subtotal of operating income. This guidance is required to be applied retrospectively and is effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted as of the beginning of an annual reporting period. Upon adoption, the Company’s operating income will increase or decrease by an amount equal to the components of net benefit cost other than service cost, which are disclosed in Note 7.
Clarifying the Definition of a Business
In January 2017, the FASB issued amended guidance on the accounting for business combinations which clarifies the definition of a business and assists entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. Under this guidance, when substantially all of the fair value of gross assets acquired is concentrated in a single asset (or group of similar assets), the assets acquired would not represent a business. In addition, in order to be considered a business, an acquisition would have to include at a minimum an input and a substantive process that together significantly contribute to the ability to create an output. The amended guidance also narrows the definition of outputs by more closely aligning it with how outputs are described in FASB guidance for revenue recognition. This guidance is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted.
Intra-Entity Transfers of Assets Other than Inventory
In October 2016, the FASB issued amended guidance on the accounting for income taxes, which eliminates the exception in existing guidance which defers the recognition of the tax effects of intra-entity asset transfers other than inventory until the transferred asset is sold to a third party. Rather, the amended guidance requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer2022.

-10-



CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

The following table presents the major classes of assets and liabilities of our discontinued operations.
occurs. This guidance, which is effective for interim
AtAt
March 31, 2023December 31, 2022
Receivables, net$419 $558 
Other current assets232 229 
Goodwill434 434 
Property and equipment, net53 53 
Operating lease assets204 204 
Other assets107 111 
Total Assets$1,449 $1,589 
Royalties payable$160 $161 
Other current liabilities320 388 
Operating lease liabilities179 182 
Other liabilities17 18 
Total Liabilities$676 $749 
3) PROGRAMMING AND OTHER INVENTORY
The following table presents our programming and annual periods beginning afterother inventory at March 31, 2023 and December 15, 2017, is not expected to have a material impact on the Company’s consolidated financial statements.31, 2022, grouped by type and predominant monetization strategy.

AtAt
March 31, 2023December 31, 2022
Film Group Monetization:
Acquired program rights, including prepaid sports rights$2,899 $3,238 
Internally-produced television and film programming:
Released6,965 7,154 
In process and other2,690 3,299 
Individual Monetization:
Acquired libraries382 394 
Film inventory:
Released720 694 
Completed, not yet released47 129 
In process and other1,588 1,317 
Internally-produced television programming:
Released759 624 
In process and other683 726 
Home entertainment44 45 
Total programming and other inventory16,777 17,620 
Less current portion1,085 1,342 
Total noncurrent programming and other inventory$15,692 $16,278 
Statement of Cash Flows: Classification of Cash Receipts and Cash Payments
-11-

In August 2016, the FASB issued amended guidance which clarifies how certain cash receipts and cash payments should be presented and classified in the statement of cash flows. The new guidance is intended to reduce the existing diversity in practice in how certain transactions are classified in the statement of cash flows. This guidance is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted.

Leases
In February 2016, the FASB issued new guidance on the accounting for leases, which supersedes previous lease guidance. Under this guidance, for all leases with terms in excess of one year, including operating leases, the Company will be required to recognize on its balance sheet a lease liability and a right-of-use asset representing its right to use the underlying asset for the lease term. The new guidance retains a distinction between finance leases and operating leases and the classification criteria is substantially similar to previous guidance. Additionally, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed. The Company is currently evaluating the impact of this guidance on its consolidated balance sheets. This guidance is effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted.

Revenue from Contracts with Customers
In May 2014, the FASB issued guidance on the recognition of revenues which provides a single, comprehensive revenue recognition model for all contracts with customers and supersedes most existing revenue recognition guidance. The main principle under this guidance is that an entity should recognize revenue at the amount it expects to be entitled to in exchange for the transfer of goods or services to customers. This guidance is effective for the Company beginning in the first quarter of 2018. The Company anticipates that it will apply the modified retrospective method of adoption with the cumulative effect of the initial adoption reflected as an adjustment to the opening balance of accumulated deficit as of January 1, 2018. The Company has identified the predominant changes to its accounting policies and is in the process of quantifying the impact on its consolidated financial statements and evaluating the additional disclosures that may be required. The adoption of this guidance is not expected to have a significant impact on the Company’s total revenues. The Company has identified changes to its revenue recognition policies primarily relating to two areas of content licensing and distribution revenues. First, revenues from certain distribution arrangements of third-party content will be recognized based on the gross amount of consideration received by the Company for such sale, with an associated expense recognized for the fees paid to the third-party producer. Under current accounting guidance, such revenues are recognized at the net amount retained by the Company after the payment of fees to the third-party producer. This change will not have an impact on the Company’s operating income. Second, revenues associated with the extension of an existing licensing arrangement, which are currently recognized upon the execution of such extension, will be recognized at a later date once the extension period begins. This change is not expected to have a material impact on the Company’s results on an annual basis, since revenues from extensions executed each year approximate revenues from extensions for which the license period has begun.


CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

2) STOCK-BASED COMPENSATION
The following table summarizespresents amortization of our television and film programming and production costs, which is included within “Operating expenses” on the Company’s stock-based compensation expenseConsolidated Statements of Operations.
Three Months Ended
March 31,
20232022
Programming costs, acquired programming$1,414 $1,496 
Production costs, internally-produced television and film programming:
Individual monetization$396 $491 
Film group monetization$1,368 $1,147 
Programming Charges
During the first quarter of 2023, in connection with our plan to integrate Showtime into Paramount+ across both streaming and linear platforms, we performed a comprehensive strategic review of the combined content portfolio of Showtime and Paramount+. We also reviewed our international content portfolio in connection with initiatives to rationalize and right-size our international operations to align with our streaming strategy, and close or globalize certain of our international channels. Following these reviews, we determined that we would not use certain content on our platforms, which resulted in the removal or abandonment of content, the write-off of development costs, and the termination of programming agreements during the quarter. Accordingly, we recorded charges totaling $1.67 billion on the Consolidated Statement of Operations for the three and nine months ended September 30, 2017March 31, 2023. The charges are comprised of $1.45 billion for the impairment of content to its estimated fair value, which included assumptions for estimated secondary market licensing revenues, if any, as well as $225 million for development cost write-offs and 2016.contract termination costs.
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
RSUs and PSUs$38
 $35
 $109
 $102
Stock options6
 7
 20
 21
Stock-based compensation expense, before income taxes44
 42
 129
 123
Related tax benefit(17) (17) (50) (48)
Stock-based compensation expense, net of tax benefit$27
 $25
 $79
 $75
4) RELATED PARTIES
DuringNational Amusements, Inc.
National Amusements, Inc. (“NAI”) is the nine months ended September 30, 2017,controlling stockholder of the Company granted 2 million RSUs for CBS Corp.Company. At March 31, 2023, NAI directly or indirectly owned approximately 77.4% of our voting Class A Common Stock and approximately 9.7% of our Class A Common Stock and non-voting Class B Common Stock withon a weighted average per unit grant-date fair value of $66.75. RSUs granted duringcombined basis. NAI is controlled by the first nine months of 2017 generally vest over a one- to four-year service period. Compensation expense for RSUs is determined based upon the market priceSumner M. Redstone National Amusements Part B General Trust (the “General Trust”), which owns 80% of the voting interest of NAI and acts by majority vote of seven voting trustees (subject to certain exceptions), including with respect to the NAI shares underlyingheld by the awards on the dateGeneral Trust. Shari E. Redstone, Chairperson, CEO and President of grant. For certain RSU awards the numberNAI and non-executive Chair of shares an employee earns ranges from 0% to 120%our Board of Directors, is one of the target award, based onseven voting trustees for the outcomeGeneral Trust and is one of established performance conditions. Compensation expense is recorded based on the probable outcometwo voting trustees who are beneficiaries of the performance conditions. During the nine months ended September 30, 2017, the Company also granted awardsGeneral Trust. No member of market-based PSUs. The numberour management or other member of shares that will be issued upon vestingour Board of Directors is a trustee of the PSUs is based on the Company’s stock price performance over a designated measurement period, as well as the achievement of established operating goals. The fair value of the PSUs is determined on the grant date using a Monte Carlo simulation model and is expensed over the required employee service period. The fair value of the PSU awards granted during the nine months ended September 30, 2017 was $23 million. General Trust.

During the nine months ended September 30, 2017, the Company also granted 1 million stock options with a weighted average exercise price of $66.31. Stock options granted during the first nine months of 2017 vest over a four-year service period and expire eight years from the date of grant. Compensation expense for stock options is determined based on the grant date fair value of the award calculated using the Black-Scholes options-pricing model.

Total unrecognized compensation cost related to unvested RSUs and PSUs at September 30, 2017 was $235 million, which is expected to be recognized over a weighted average period of 2.3 years. Total unrecognized compensation cost related to unvested stock option awards at September 30, 2017 was $45 million, which is expected to be recognized over a weighted average period of 2.5 years.
3) DISCONTINUED OPERATIONS
On February 2, 2017, the Company entered into an agreement with Entercom to combine the Company’s radio business, CBS Radio, with Entercom in a merger to be effected through a Reverse Morris Trust transaction, which is expected to be tax-free to CBS Corp. and its stockholders. In connection with this transaction, on October 19, 2017, the Company commenced an exchange offer through which it will split-off CBS Radio. In the exchange offer, the Company’s stockholders have the opportunity to exchange their shares of the Company’s Class B Common Stock for shares of CBS Radio common stock, which will be immediately converted into shares of Entercom Class A common stock upon completion of the merger. The exchange ratio is calculated based on the trading prices of CBS Class B Common Stock and Entercom Class A common stock with a 7% discount per-share value, subject to an upper limit of 5.7466 shares of CBS Radio common stock for each share of CBS Class B

-12-



CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

Other Related Parties
Common Stock. Based onIn the exchange ratio atordinary course of business, we are involved in transactions with our equity-method investees, primarily for the commencementlicensing of television and film programming. The following tables present the exchange offer, and assuming the exchange offer is fully subscribed, the Company would receive approximately 19 million sharesamounts recorded in the exchange offer, thereby reducing the Company’s shares outstanding. However, the exchange ratio will change based on fluctuations in the trading prices of CBS Class B Common Stock and Entercom Class A common stock. A 10% change to the exchange ratio would change the number of shares the Company receives in the exchange offer by approximately 2 million shares. The exchange offer is scheduled to expire on November 16, 2017, unless the exchange offer is extended or terminated. The transaction is subject to certain customary terms and conditions. CBS Radio has been classified as held for sale and presented as a discontinued operation in the Company’sour consolidated financial statements related to these transactions.
Three Months Ended
March 31,
2023 (a)
2022
Revenues$108 $54 
Operating expenses$4 $5 
(a) The increase in revenues for allthethree months ended March 31, 2023 relates to the SkyShowtime streaming service, which launched in September 2022.
AtAt
March 31, 2023December 31, 2022
Accounts receivable$237 $198 

Through the normal course of business, we are involved in other transactions with related parties that have not been material in any of the periods presented.

FASB Accounting Standards Codification (“ASC”) 360 requires that an asset classified5) REVENUES
The table below presents our revenues disaggregated into categories based on the nature of such revenues. See Note 12 for revenues by segment disaggregated into these categories.
Three Months Ended
March 31,
20232022
Revenues by Type:
Advertising$2,651 $2,864 
Affiliate and subscription3,179 2,840 
Theatrical127 131 
Licensing and other1,308 1,493 
Total Revenues$7,265 $7,328 
Receivables
Reserves for accounts receivable reflect our expected credit losses based on historical experience as heldwell as current and expected economic conditions. At March 31, 2023 and December 31, 2022, our allowance for sale be measured each reporting periodcredit losses was $109 million and $111 million, respectively.

Included in “Other assets” on the Consolidated Balance Sheets are noncurrent receivables of $1.51 billion and $1.61 billion atMarch 31, 2023and December 31, 2022, respectively. Noncurrent receivables primarily relate to revenues recognized under long-term content licensing arrangements. Revenues from the licensing of content are recognized at the lower of its carrying amount or fair value less cost to sell. The ultimate valuebeginning of the transaction with Entercom will be determined based on Entercom’s stock price atlicense period in which programs are made available to the closinglicensee for exhibition, while the related cash is generally collected over the term of the transaction. The Company recorded a noncash gain of $100 million for the three months ended September 30, 2017 and a noncash charge of $980 million for the nine months ended September 30, 2017 associated with a valuation allowance to adjust the carrying value of CBS Radio to the value indicated by the stock valuation of Entercom. The Company will record an additional gain or loss upon the closing of the transaction, which is expected to occur in the fourth quarter of 2017. A 10% change to Entercom’s stock price would change the carrying value of CBS Radio by approximately $110 million.license period.

For the nine months ended September 30, 2017, CBS Radio recorded a restructuring charge of $7 million associated with the reorganization of certain business operations, reflecting severance costs and costs associated with exiting contractual obligations.

The following tables set forth details of net earnings (loss) from discontinued operations for the three and nine months ended September 30, 2017 and 2016. Net earnings (loss) from discontinued operations included the operating results of CBS Radio for all periods presented. Net earnings (loss) from discontinued operations also included a tax benefit of $45 million for the three and nine months ended September 30, 2017 and a charge of $36 million for the three and nine months ended September 30, 2016, in each case from the resolution of a tax matter in a foreign jurisdiction relating to a previously disposed business that was accounted for as a discontinued operation.
-13-
Three Months Ended September 30, 2017CBS Radio
Other
Total
Revenues$300

$—

$300
Costs and expenses: (a)








Operating113

—

113
Selling, general and administrative121

(1)
120
Benefit from valuation allowance(100)
—

(100)
Total costs and expenses134

(1)
133
Operating income166

1

167
Interest expense(21)
—

(21)
Earnings from discontinued operations145

1

146
Income tax (provision) benefit(17)
45

28
Net earnings from discontinued operations, net of tax$128

$46

$174

(a) CBS Radio has been classified as held for sale beginning in the fourth quarter of 2016. Under ASC 360, assets held for sale are not depreciated or amortized.


CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

Contract Liabilities
Three Months Ended September 30, 2016CBS Radio
Other
Total
Revenues$317

$—

$317
Costs and expenses:







Operating110

—

110
Selling, general and administrative123

—

123
Depreciation and amortization7

—

7
Total costs and expenses240

—

240
Operating income77

—

77
Other income2

—

2
Earnings from discontinued operations79

—

79
Income tax provision(31)
(36)
(67)
Net earnings (loss) from discontinued operations, net of tax$48

$(36)
$12
Nine Months Ended September 30, 2017CBS Radio
Other
Total
Revenues$856

$—

$856
Costs and expenses: (a)








Operating307

—

307
Selling, general and administrative372

(1)
371
Restructuring charge7

—

7
Provision for valuation allowance980

—

980
Total costs and expenses1,666

(1)
1,665
Operating income (loss)(810)
1

(809)
Interest expense(60)
—

(60)
Earnings (loss) from discontinued operations(870)
1

(869)
Income tax (provision) benefit(47)
45

(2)
Net earnings (loss) from discontinued operations, net of tax$(917)
$46

$(871)
(a) CBS Radio has been classified as heldContract liabilities are included within “Deferred revenues” and “Other liabilities” on the Consolidated Balance Sheets and were $1.16 billion and $1.06 billion at March 31, 2023 and December 31, 2022, respectively. We recognized revenues of $0.3 billion and $0.4 billion for sale beginningthe three months ended March 31, 2023 and 2022, respectively, that were included in the fourth quarteropening balance of 2016.deferred revenues for the respective year.

Unrecognized Revenues Under ASC 360, assets heldContract
At March 31, 2023, unrecognized revenues attributable to unsatisfied performance obligations under our long-term contracts were approximately $9 billion, of which $3 billion is expected to be recognized during the remainder of 2023, $2 billion in 2024, $1 billion in 2025, and $3 billion thereafter. These amounts only include contracts subject to a guaranteed fixed amount or the guaranteed minimum under variable contracts, primarily consisting of television and film licensing contracts and affiliate agreements that are subject to a fixed or guaranteed minimum fee. Such amounts change on a regular basis as we renew existing agreements or enter into new agreements. Unrecognized revenues under contracts disclosed above do not include (i) contracts with an original expected term of one year or less, mainly consisting of advertising contracts, (ii) contracts for which variable consideration is determined based on the customer’s subsequent sale are not depreciated or amortized.usage, mainly consisting of affiliate agreements and (iii) long-term licensing agreements for multiple programs for which variable consideration is determined based on the value of the programs delivered to the customer and our right to invoice corresponds with the value delivered.

Performance Obligations Satisfied in Previous Periods
Under certain licensing arrangements, the amount and timing of our revenue recognition is determined based on our licensees’ subsequent sale to its end customers. As a result, under such arrangements we often satisfy our performance obligation of delivery of our content in advance of revenue recognition. We recognized revenues of $0.1 billion and $0.2 billion for the three months ended March 31, 2023 and 2022, respectively, from arrangements for the licensing of our content, including from distributors of transactional video-on-demand and electronic sell-through services and other licensing arrangements, as well as from the theatrical distribution of our films, for which our performance obligation was satisfied in a prior period.
-14-
Nine Months Ended September 30, 2016CBS Radio
Other
Total
Revenues$892

$—

$892
Costs and expenses:







Operating298

—

298
Selling, general and administrative359

—

359
Depreciation and amortization20

—

20
Total costs and expenses677

—

677
Operating income215

—

215
Other income2

—

2
Earnings from discontinued operations217

—

217
Income tax provision(88)
(36)
(124)
Net earnings (loss) from discontinued operations, net of tax$129

$(36)
$93




CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

6) DEBT
The following table presents the major classes of assets and liabilitiesOur debt consists of the Company’s discontinued operations.following:
AtAt
March 31, 2023December 31, 2022
7.875% Debentures due 2023$139 $139 
7.125% Senior Notes due 202335 35 
4.75% Senior Notes due 2025553 552 
4.0% Senior Notes due 2026795 795 
3.45% Senior Notes due 2026124 124 
2.90% Senior Notes due 2027694 694 
3.375% Senior Notes due 2028496 496 
3.70% Senior Notes due 2028494 494 
4.20% Senior Notes due 2029495 495 
7.875% Senior Debentures due 2030830 830 
4.95% Senior Notes due 20311,227 1,226 
4.20% Senior Notes due 2032975 975 
5.50% Senior Debentures due 2033427 427 
4.85% Senior Debentures due 203487 87 
6.875% Senior Debentures due 20361,071 1,071 
6.75% Senior Debentures due 203775 75 
5.90% Senior Notes due 2040298 298 
4.50% Senior Debentures due 204245 45 
4.85% Senior Notes due 2042489 488 
4.375% Senior Debentures due 20431,132 1,130 
4.875% Senior Debentures due 204318 18 
5.85% Senior Debentures due 20431,234 1,233 
5.25% Senior Debentures due 2044345 345 
4.90% Senior Notes due 2044541 541 
4.60% Senior Notes due 2045590 590 
4.95% Senior Notes due 2050946 946 
6.25% Junior Subordinated Debentures due 2057643 643 
6.375% Junior Subordinated Debentures due 2062989 989 
Other bank borrowings58 55 
Obligations under finance leases8 10 
Total debt (a)
15,853 15,846 
Less current portion240 239 
Total long-term debt, net of current portion$15,613 $15,607 
 At At
 September 30, 2017 December 31, 2016
Receivables, net $254
   $244
 
Other current assets 101
   61
 
Goodwill 1,285
   1,285
 
Intangible assets 2,832
   2,832
 
Net property and equipment 157
   145
 
Other assets 31
   29
 
Valuation allowance for carrying value (980)   —
 
Total Assets $3,680
   $4,596
 
Current portion of long-term debt $10
   $10
 
Other current liabilities 144
   145
 
Long-term debt 1,355
   1,335
 
Deferred income tax liabilities 1,013
   998
 
Other liabilities 98
   118
 
Total Liabilities $2,620
   $2,606
 
(a) At March 31, 2023 and December 31, 2022, the senior and junior subordinated debt balances included (i) a net unamortized discount of $437 million and $442 million, respectively, and (ii) unamortized deferred financing costs of $88 million and $89 million, respectively. The face value of our total debt was $16.38 billion at both March 31, 2023 and December 31, 2022.
The following table presents CBS Radio’s long-term debt.
 At At
 September 30, 2017 December 31, 2016
Term Loan due October 2023, net of discount $947
   $955
 
7.250% Senior Notes due November 2024 400
   400
 
Revolving Credit Facility 36
   10
 
Deferred financing costs (18)   (20) 
Total long-term debt, including current portion $1,365
   $1,345
 
CBS Radio’sDuring the first quarter of 2022, we redeemed $1.42 billion of senior secured term loan (“Term Loan”) bears interest at a rate equalnotes, prior to 3.50% plus the greatermaturity, for an aggregate redemption price of the London Interbank Offered Rate (“LIBOR”)$1.48 billion and 1.00%. The Term Loan is part of CBS Radio’s credit agreement which also includes a $250 million senior secured revolving credit facility (the “Revolving Credit Facility”) which expires in 2021. Interest on the Revolving Credit Facility is based on either LIBOR or a base rate plus a margin based on CBS Radio’s Consolidated Net Secured Leverage Ratio. The Consolidated Net Secured Leverage Ratio reflects the ratio of CBS Radio’s secured debt (less up to $150$520 million of cash5.875% junior subordinated debentures due February 2057 at par. These redemptions resulted in a total pre-tax loss on extinguishment of debt of $73 million.

During the first quarter of 2022, we also issued $1.00 billion of 6.375% junior subordinated debentures due 2062.

Commercial Paper
At both March 31, 2023 and cash equivalents) to CBS Radio’s consolidated EBITDA (as defined in the credit agreement). The Revolving Credit Facility requires CBS Radio to maintain a maximum Consolidated Net Secured Leverage Ratio of 4.00 to 1.00.December 31, 2022, we had no outstanding commercial paper borrowings.


In connection with financing for the transaction with Entercom, on March 3, 2017, CBS Radio entered into Amendment No. 1 to its credit agreement, dated as of October 17, 2016, to, among other things, create a tranche of Term B-1 Loans in an aggregate principal amount not to exceed $500 million. The Term B-1 Loans are expected to be funded substantially concurrently with the closing date of the transaction, subject to customary conditions.

-15-



CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

4) PROGRAMMING AND OTHER INVENTORY
 At At
 September 30, 2017 December 31, 2016
Acquired program rights $2,087
   $1,773
 
Acquired television library 99
   —
 
Internally produced programming:       
Released 1,799
   1,746
 
In process and other 601
   298
 
Publishing, primarily finished goods 58
   49
 
Total programming and other inventory 4,644
   3,866
 
Less current portion 1,830
   1,427
 
Total noncurrent programming and other inventory $2,814
   $2,439
 

5) RELATED PARTIES
National Amusements, Inc. National Amusements, Inc. (“NAI”) is the controlling stockholder of CBS Corp. and Viacom Inc. Mr. Sumner M. Redstone, the controlling stockholder, chairman of the board of directors and chief executive officer of NAI, is the Chairman Emeritus of CBS Corp. and the Chairman Emeritus of Viacom Inc. In addition, Ms. Shari Redstone, Mr. Sumner M. Redstone’s daughter, is the president and a director of NAI and the vice chair of the Board of Directors of each of CBS Corp. and Viacom Inc. Mr. David R. Andelman is a director of CBS Corp. and serves as a director of NAI. At September 30, 2017, NAI directly or indirectly owned approximately 79.5% of CBS Corp.’s voting Class A Common Stock, and owned approximately 9.8% of CBS Corp.’s Class A Common Stock and non-voting Class B Common Stock on a combined basis. NAI is controlled by Mr. Redstone through the Sumner M. Redstone National Amusements Trust (the “SMR Trust”), which owns 80% of the voting interest of NAI, and such voting interest of NAI held by the SMR Trust is voted solely by Mr. Redstone until his incapacity or death. The SMR Trust provides that in the event of Mr. Redstone’s death or incapacity, voting control of the NAI voting interest held by the SMR Trust will pass to seven trustees, who will include CBS Corporation directors Ms. Shari Redstone and Mr. David R. Andelman. No member of the Company’s management is a trustee of the SMR Trust.

Viacom Inc. As part of its normal course of business, the Company licenses its television content, leases production facilities and sells advertising spots to various subsidiaries of Viacom Inc. Viacom Inc. also distributes certain of the Company’s television programs in the home entertainment market. The Company’s total revenues from these transactions were $38 million and $16 million for the three months ended September 30, 2017 and 2016, respectively, and $111 million and $83 million for the nine months ended September 30, 2017 and 2016, respectively.

The Company places advertisements with and leases production facilities from various subsidiaries of Viacom Inc. The total amounts for these transactions were $4 million and $6 million for the three months ended September 30, 2017 and 2016, respectively, and $13 million and $17 million for the nine months ended September 30, 2017 and 2016, respectively.



CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

The following table presents the amounts due from Viacom Inc. in the normal course of business as reflected on the Company’s Consolidated Balance Sheets. Amounts due to Viacom Inc. were minimal at September 30, 2017 and December 31, 2016.
 At At
 September 30, 2017 December 31, 2016
Receivables $112
   $113
 
Other assets (Receivables, noncurrent) 20
   35
 
Total amounts due from Viacom Inc.
 $132
   $148
 
Other Related Parties. The Company has equity interests in two domestic television networks and several international joint ventures for television channels from which the Company earns revenues primarily by selling its television programming. Total revenues earned from sales to these joint ventures were $5 million and $13 million for the three months ended September 30, 2017 and 2016, respectively, and $54 million and $69 million for the nine months ended September 30, 2017 and 2016, respectively. At September 30, 2017 and December 31, 2016, total amounts due from these joint ventures were $29 million and $47 million, respectively.

The Company, through the normal course of business, is involved in transactions with other related parties that have not been material in any of the periods presented.
6) BANK FINANCING AND DEBT
The following table sets forth the Company’s debt.

At At

September 30, 2017 December 31, 2016
Commercial paper
$590



$450

Senior debt (1.95% - 7.875% due 2017 - 2045) (a)

9,039



8,850

Obligations under capital leases
60



75

Total debt
9,689



9,375

Less commercial paper
590



450

Less current portion of long-term debt
19



23

Total long-term debt, net of current portion
$9,080



$8,902

(a) At September 30, 2017 and December 31, 2016, the senior debt balances included (i) a net unamortized discount of $55 million and $52 million, respectively, (ii) unamortized deferred financing costs of $45 million and $43 million, respectively, and (iii) a $2 million decrease and a $5 million increase, respectively, in the carrying value of the debt relating to previously settled fair value hedges. The face value of the Company’s senior debt was $9.14 billion and $8.94 billion at September 30, 2017 and December 31, 2016, respectively.

In July 2017, the Company issued $400 million of 2.50% senior notes due 2023 and $500 million of 3.375% senior notes due 2028. The Company used the net proceeds from these issuances to repay its $400 million outstanding 1.95% senior notes that matured on July 1, 2017 and to redeem all of its $300 million outstanding 4.625% senior notes due May 2018. The remaining proceeds were used for general corporate purposes, including the repayment of short-term borrowings, including commercial paper.

The early redemption of the $300 million 4.625% senior notes due May 2018 resulted in a pre-tax loss on early extinguishment of debt of $5 million ($3 million, net of tax) for the three and nine months ended September 30, 2017.



CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

Commercial Paper
The Company had outstanding commercial paper borrowings under its $2.5 billion commercial paper program of $590 million and $450 million at September 30, 2017 and December 31, 2016, respectively, each with maturities of less than 60 days. The weighted average interest rate for these borrowings was 1.44% at September 30, 2017 and 0.98% at December 31, 2016.

Credit Facility
At September 30, 2017, the Company had a $2.5In March 2023, we amended and extended our $3.50 billion revolving credit facility (the “Credit Facility”), which expiresnow matures in June 2021. The Credit Facility requires the Company to maintain a maximum Consolidated Leverage Ratio of 4.5x at the end of each quarter as further described in the Credit Facility. At September 30, 2017, the Company’s Consolidated Leverage Ratio was approximately 3.0xJanuary 2027 (the “2023 Amendment”).

The Consolidated Leverage Ratio is the ratio of the Company’s indebtedness from continuing operations, adjusted to exclude certain capital lease obligations, at the end of a quarter, to the Company’s Consolidated EBITDA for the trailing four consecutive quarters. Consolidated EBITDA is defined in the Credit Facility as operating income plus interest income and before depreciation, amortization and certain other noncash items.

The Credit Facility is used for general corporate purposes.purposes and to support commercial paper borrowings, if any. We may, at our option, also borrow in certain foreign currencies up to specified limits under the Credit Facility. Borrowing rates under the Credit Facility are determined at the time of each borrowing and are generally based on either the prime rate in the U.S. or an applicable benchmark rate plus a margin (based on our senior unsecured debt rating), depending on the type and tenor of the loans entered into. Under the 2023 Amendment, we replaced LIBOR as the benchmark rate for loans denominated in U.S. dollars with Term SOFR. The benchmark rate for loans denominated in euros, sterling and yen is based on EURIBOR, SONIA and TIBOR, respectively. The Credit Facility was also amended to include a provision that the occurrence of a Change of Control (as defined in the amended credit agreement) of Paramount will be an event of default that would give the lenders the right to accelerate any outstanding loans and terminate their commitments. At September 30, 2017, the CompanyMarch 31, 2023, we had no borrowings outstanding under the Credit Facility and the remaining availability under the Credit Facility, net of outstanding letters of credit, was $2.49 billion.$3.50 billion.
7) PENSION AND OTHER POSTRETIREMENT BENEFITS
The componentsCredit Facility has one principal financial covenant which sets a maximum Consolidated Total Leverage Ratio (“Leverage Ratio”) at the end of net periodic costeach quarter, which prior to the 2023 Amendment was 4.5x. Under the 2023 Amendment, the maximum Leverage Ratio was increased to 5.75x for each quarter through and including the quarter ending September 30, 2024, and will then decrease to 5.5x for the Company’s pensionquarters ending December 31, 2024 and postretirement benefit plans wereMarch 31, 2025, with decreases of 0.25x for each subsequent quarter until it reaches 4.5x for the quarter ending March 31, 2026. The Leverage Ratio reflects the ratio of our Consolidated Indebtedness, net of unrestricted cash and cash equivalents at the end of a quarter, to our Consolidated EBITDA (each as follows:defined in the amended credit agreement) for the trailing twelve-month period. Under the 2023 Amendment, the definition of the Leverage Ratio was also modified to set the maximum amount of unrestricted cash and cash equivalents that can be netted against Consolidated Indebtedness to $1.50 billion for quarters ending on or after September 30, 2024. In addition, under the 2023 Amendment, Simon & Schuster shall be treated as a continuing operation for the purposes of calculating Consolidated EBITDA until its disposition. We met the covenant as of March 31, 2023.

Other Bank Borrowings
At March 31, 2023 and December 31, 2022, we had bank borrowings under Miramax’s $300 million credit facility, which matured in April 2023, of $58 million and $55 million, respectively, with weighted average interest rates of 7.48% and 7.09%, respectively.
7) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
The carrying value of our financial instruments approximates fair value, except for notes and debentures. At March 31, 2023 and December 31, 2022, the carrying value of our outstanding notes and debentures was $15.79 billion and $15.78 billion, respectively, and the fair value, which is determined based on quoted prices in active markets (Level 1 in the fair value hierarchy) was $14.2 billion and $13.9 billion, respectively.

Investments
The carrying value of our investments without a readily determinable fair value for which we have no significant influence was $72 million and $70 million at March 31, 2023 and December 31, 2022, respectively. These investments are included in “Other assets” on the Consolidated Balance Sheets.

-16-
 Pension Benefits Postretirement Benefits
Three Months Ended September 30,2017 2016 2017 2016
Components of net periodic cost:       
Service cost$7
 $7
 $—
 $—
Interest cost48
 54
 4
 5
Expected return on plan assets(50) (56) —
 —
Amortization of actuarial loss (gain) (a)
26
 21
 (5) (5)
Net periodic cost$31
 $26
 $(1) $—


 Pension Benefits Postretirement Benefits
Nine Months Ended September 30,2017
2016
2017
2016
Components of net periodic cost:       
Service cost$22
 $22
 $—
 $—
Interest cost143
 161
 13
 15
Expected return on plan assets(151) (170) —
 —
Amortization of actuarial loss (gain) (a)
77
 64
 (16) (16)
Net periodic cost$91
 $77
 $(3) $(1)
(a) Reflects amounts reclassified from accumulated other comprehensive loss to net earnings.


CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

On November 1, 2017, the Company entered into a definitive agreementIn April 2023, our ownership of Viacom18 was diluted from 49% to purchase a group annuity contract, under which an insurance company will be required to pay and administer pension payments to certain of the Company’s pension plan participants, or their designated beneficiaries, who have been receiving pension payments. The purchase of this group annuity contract will reduce the Company’s outstanding pension benefit obligation by approximately $800 million, representing approximately 20% of the total obligations of the Company’s qualified pension plans, and will be funded with pension plan assets. In connection with this transaction, the Company will record a one-time settlement charge in the fourth quarter of 2017 currently estimated at $365 million, reflecting the accelerated recognition of a portion of unamortized actuarial losses in the plan. The actual settlement charge could differ from this estimate due to changes in the Company’s actuarial assumptions. Additionally, during the fourth quarter of 2017, the Company expects to make a discretionary contribution of $500 million to prefund its qualified plans, which is expected to be partially funded by long-term borrowings.
8) STOCKHOLDERS’ EQUITY
During the third quarter of 2017, the Company repurchased 3.9 million shares of its Class B Common Stock under its share repurchase program for $250 million, at an average cost of $63.52 per share. During the nine months ended September 30, 2017, the Company repurchased 16.2 million shares of its Class B Common Stock for $1.05 billion, at an average cost of $64.70 per share, leaving $3.06 billion of authorization at September 30, 2017.

During the third quarter of 2017, the Company declared a quarterly cash dividend of $.18 on its Class A and Class B Common Stock, resulting in total dividends of $73 million, which were paid on October 1, 2017.
Accumulated Other Comprehensive Income (Loss)
The following tables summarize the changes in the components of accumulated other comprehensive loss.
 
Cumulative
Translation
Adjustments
 
Net Actuarial
Loss and Prior
Service Cost
 
Accumulated
Other
Comprehensive Loss
At December 31, 2016$151
 $(918)  $(767) 
Other comprehensive income before reclassifications4
 —
  4
 
Reclassifications to net earnings—
 37
(a) 
 37
 
Net other comprehensive income4
 37

 41
 
At September 30, 2017$155
 $(881)
 $(726) 
 
Cumulative
Translation
Adjustments
 
Net Actuarial
Loss and Prior
Service Cost
 
Accumulated
Other
Comprehensive Loss
At December 31, 2015$152
 $(922)  $(770) 
Other comprehensive income before reclassifications2
 —
  2
 
Reclassifications to net earnings—
 29
(a) 
 29
 
Net other comprehensive income2
 29
  31
 
At September 30, 2016$154
 $(893)  $(739) 
(a)Reflects amortization of net actuarial losses. See Note 7.

The net actuarial loss and prior service cost related to pension and other postretirement benefit plans included in other comprehensive income is net of a tax provision of $24 million and $19 million for the nine months ended September 30, 2017 and 2016, respectively.


CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

9) INCOME TAXES
The provision for income taxes represents federal, state and local, and foreign income taxes on earnings from continuing operations before income taxes and equity in loss of investee companies.
 Three Months Ended September 30,
Nine Months Ended September 30,
 2017
2016
2017
2016
Provision for income taxes, including interest and before
other discrete items
$(187) $(207) $(548) $(581)
Excess tax benefits from stock-based compensation (a)
10

—

41

—
Other discrete items (b)
5

62

28

57
Provision for income taxes$(172)
$(145)
$(479)
$(524)
Effective income tax rate28.4%
23.2%
26.7%
28.4%
(a) Reflects excess tax benefits associated with the exercise of stock options and vesting of RSUs. During the first quarter of 2017, the Company adopted FASB guidance which requires that the difference between the tax benefit from stock-based compensation expense and the deduction on the tax return be recognized within the income tax provision on the statement of operations. Previously, such difference was recognized in stockholders’ equity on the balance sheet. This difference occurs because stock-based compensation expense is recorded based on the grant-date fair value of the award, whereas the tax deduction is based on the fair value on the date the stock option is exercised or the RSU vests. This guidance requires the income statement classification to be applied prospectively, and therefore, excess tax benefits for prior periods remain classified in stockholders’ equity.
(b) For the nine months ended September 30, 2017, primarily reflects tax benefits from the resolution of certain state income tax matters. For the three and nine months ended September 30, 2016, primarily reflects a one-time tax benefit of $47 million associated with a multiyear adjustment to a tax deduction, which was approved by the IRS during the third quarter of 2016.

10) COMMITMENTS AND CONTINGENCIES
Guarantees
The Company has indemnification obligations with respect to letters of credit and surety bonds primarily used as security against non-performance in the normal course of business. At September 30, 2017, the outstanding letters of credit and surety bonds approximated $99 million and were not recorded on the Consolidated Balance Sheet.

In the course of its business, the Company both provides and receives indemnities which are intended to allocate certain risks associated with business transactions. Similarly, the Company may remain contingently liable for various obligations of a business that has been divested in the event that a third party does not live up to its obligations under an indemnification obligation. The Company records a liability for its indemnification obligations and other contingent liabilities when probable and reasonably estimable.

Legal Matters
General. On an ongoing basis, the Company vigorously defends itself in numerous lawsuits and proceedings and responds to various investigations and inquiries from federal, state, local and international authorities (collectively, ‘‘litigation’’). Litigation may be brought against the Company without merit, is inherently uncertain and always difficult to predict. However, based on its understanding and evaluation of the relevant facts and circumstances, the Company believes that the below-described legal matters and other litigation to which it is a party are not likely, in the aggregate, to have a material adverse effect on its results of operations, financial position or cash flows. Under the Separation Agreement between the Company and Viacom Inc., the Company and Viacom Inc. have agreed to defend and indemnify the other in certain litigation in which the Company and/or Viacom Inc. is named.


CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

Claims Related to Former Businesses: Asbestos. The Company is a defendant in lawsuits claiming various personal injuries related to asbestos and other materials, which allegedly occurred principally13% as a result of exposure causedinvestment by various products manufactured by Westinghouse, a predecessor, generally prior toother investors. Accordingly, we will no longer account for this investment under the early 1970s. Westinghouse was neither a producer nor a manufacturer of asbestos.equity-method. The Company is typically named as one of a large number of defendants in both state and federal cases. In the majority of asbestos lawsuits, the plaintiffs have not identified which of the Company’s products is the basis of a claim. Claims against the Company in which a product has been identified principally relate to exposures allegedly caused by asbestos-containing insulating material in turbines sold for power-generation, industrial and marine use.

Claims are frequently filed and/or settled in groups, which may make the amount and timing of settlements, and the number of pending claims, subject to significant fluctuation from period to period. The Company does not report as pending those claims on inactive, stayed, deferred or similar dockets which some jurisdictions have established for claimants who allege minimal or no impairment. As of September 30, 2017, the Company had pending approximately 32,760 asbestos claims, as compared with approximately 33,610 as of December 31, 2016 and 34,400 as of September 30, 2016. During the third quarter of 2017, the Company received approximately 720 new claims and closed or moved to an inactive docket approximately 1,200 claims. The Company reports claims as closed when it becomes aware that a dismissal order has been entered by a court or when the Company has reached agreement with the claimants on the material terms of a settlement. Settlement costs depend on the seriousness of the injuries that form the basis of the claims, the quality of evidence supporting the claims and other factors. In 2016, the Company’s costs for settlement and defense of asbestos claims after insurance and taxes were approximately $48 million. In 2015, as the result of an insurance settlement, insurance recoveries exceeded the Company’s after tax costs for settlement and defense of asbestos claims by approximately $5 million. The Company’s costs for settlement and defense of asbestos claims may vary year to year and insurance proceeds are not always recovered in the same period as the insured portion of the expenses.

The Company believes that its reserves and insurance are adequate to cover its asbestos liabilities. This belief is based upon many factors and assumptions, including the number of outstanding claims, estimated average cost per claim, the breakdown of claims by disease type, historic claim filings, costs per claim of resolution and the filing of new claims. While the number of asbestos claims filed against the Company has remained generally flat in recent years, it is difficult to predict future asbestos liabilities, as events and circumstances may occur including, among others, the number and types of claims and average cost to resolve such claims, which could affect the Company’s estimate of its asbestos liabilities.

Other. The Company from time to time receives claims from federal and state environmental regulatory agencies and other entities asserting that it is or may be liable for environmental cleanup costs and related damages principally relating to historical and predecessor operations of the Company. In addition, the Company from time to time receives personal injury claims including toxic tort and product liability claims (other than asbestos) arising from historical operations of the Company and its predecessors.


CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

11) RESTRUCTURING CHARGES
During the year ended December 31, 2016, in a continued effort to reduce its cost structure, the Company initiated restructuring plans across several of its businesses, primarily for the reorganization of certain business operations. As a result, the Company recorded restructuring charges of $30 million, reflecting $19 million of severance costs and $11 million of costs associated with exiting contractual obligations and other related costs. During the year ended December 31, 2015, the Company recorded restructuring charges of $45 million, reflecting $24 million of severance costs and $21 million of costs associated with exiting contractual obligations and other related costs. As of September 30, 2017, the cumulative settlements for the 2016 and 2015 restructuring charges were $57 million, of which $37 million was for severance costs and $20 million was for costs associated with contractual obligations.
 Balance at 2017 Balance at
 December 31, 2016 Settlements September 30, 2017
Entertainment $20
   $(12)   $8
 
Cable Networks 4
   (2)   2
 
Publishing 1
   (1)   —
 
Local Media 12
   (5)   7
 
Corporate 2
   (1)   1
 
Total $39
   $(21)   $18
 
 Balance at 2016 2016 Balance at
 December 31, 2015 Charges Settlements December 31, 2016
Entertainment $16
   $16
   $(12)   $20
 
Cable Networks —
   4
   —
   4
 
Publishing —
   1
   —
   1
 
Local Media 11
   6
   (5)   12
 
Corporate —
   3
   (1)   2
 
Total $27
   $30
   $(18)   $39
 
12) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
The Company’s carrying value of financial instruments approximates fair value, except for notes and debentures, which are not recorded at fair value. At September 30, 2017 and December 31, 2016,difference between the carrying value of the Company’s senior debt was $9.04 billion and $8.85 billion, respectively,our 49% interest and the fair value which is estimated based on quoted market prices for similar liabilities (Level 2) and includes accruedof our 13% interest, was $9.85 billion and $9.51 billion, respectively.as indicated by the additional investments, will be recognized as a noncash gain of approximately $160 million during the second quarter of 2023.


The Company uses derivative financial instruments primarily to modify its exposure to market risks from fluctuations in foreign currency exchange rates. The Company does not use derivative instruments unless there is an underlying exposure and, therefore, the Company does not hold or enter into derivative financial instruments for speculative trading purposes.

Foreign Exchange Contracts

We use derivative financial instruments primarily to manage our exposure to market risks from fluctuations in foreign currency exchange rates. We do not use derivative instruments unless there is an underlying exposure and, therefore, we do not hold or enter into derivative financial instruments for speculative trading purposes.

Foreign exchange forward contracts have principally been used to hedge projected cash flows, in currencies such as the British Pound,pound, the Euro,euro, the Canadian Dollardollar and the Australian Dollar,dollar, generally for periods up to 24 months. The Company designatesWe designate foreign exchange forward contracts used to hedge committed and forecasted foreign currency transactions as cash flow hedges. Additionally, we enter into non-designated forward contracts to hedge non-U.S. dollar denominated cash flows.

At March 31, 2023 and December 31, 2022, the notional amount of all foreign exchange contracts was $3.45 billion and $3.06 billion, respectively. At March 31, 2023, $2.86 billion related to future production costs and $588 millionrelated to our foreign currency balances and other expected foreign currency cash flows. At December 31, 2022, $2.40 billion related to future production costs and $655 millionrelated to our foreign currency balances and other expected foreign currency cash flows.

Gains or lossesrecognized on the effective portion of designated cash flow hedges are initially recorded in other comprehensive income and reclassified to the statement of operations when the hedgedderivative financial instruments were as follows:
Three Months Ended
March 31,
20232022Financial Statement Account
Non-designated foreign exchange contracts$1 $2 Other items, net

-17-



CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

item is recognized. Additionally, the Company enters into non-designated forward contracts to hedge non-U.S. dollar denominated cash flows.

At September 30, 2017 and December 31, 2016, the notional amount of all foreign exchange contracts was $379 million and $433 million, respectively.
Gains (losses) recognized on derivative financial instruments were as follows:
 Three Months Ended Nine Months Ended 
 September 30, September 30, 
 2017 2016 2017 2016Financial Statement Account
Non-designated foreign exchange contracts$(9) $4
 $(29) $13
Other items, net
Fair Value Measurements
The fair value of the Company’s derivative instruments was not material to the Consolidated Balance Sheets for any of the periods presented.
The following tables set forth the Company’stable below presents our assets and liabilities measured at fair value on a recurring basis at September 30, 2017March 31, 2023 and December 31, 2016.2022. These assets and liabilities have been categorized according to the three-level fair value hierarchy established by the FASB,Financial Accounting Standards Board (“FASB”), which prioritizes the inputs used in measuring fair value. Level 1 is based on publicly quoted prices for the asset or liability in active markets. Level 2 is based on inputs that are observable other than quoted market prices in active markets, such as quoted prices for the asset or liability in inactive markets or quoted prices for similar assets or liabilities. Level 3 is based on unobservable inputs reflecting the Company’sour own assumptions about the assumptions that market participants would use in pricing the asset or liability.
At September 30, 2017Level 1 Level 2 Level 3 Total
Assets:       
Foreign currency hedges$—
 $6
 $—
 $6
Total Assets$—
 $6
 $—
 $6
Liabilities:       
Deferred compensation$—
 $347
 $—
 $347
Foreign currency hedges—
 11
 —
 11
Total Liabilities$—
 $358
 $—
 $358
At December 31, 2016Level 1 Level 2 Level 3 Total
Assets:       
Foreign currency hedges$—
 $34
 $—
 $34
Total Assets$—
 $34
 $—
 $34
Liabilities:       
Deferred compensation$—
 $324
 $—
 $324
Foreign currency hedges—
 1
 —
 1
Total Liabilities$—
 $325
 $—
 $325
All of our assets and liabilities that are measured at fair value on a recurring basis use level 2 inputs. The fair value of foreign currency hedges is determined based on the present value of future cash flows using observable inputs including foreign currency exchange rates. The fair value of deferred compensation liabilities is determined based on the fair value of the investments elected by employees.
AtAt
March 31, 2023December 31, 2022
Assets:
Foreign currency hedges$37 $39 
Total Assets$37 $39 
Liabilities:
Deferred compensation$340 $336 
Foreign currency hedges76 83 
Total Liabilities$416 $419 
During the first quarter of 2023, we recorded programming charges of $1.67 billion, including $1.45 billion for the impairment of content to its estimated fair value, which included assumptions for estimated secondary market licensing revenues, if any (Level 3). See Note 3.
8) VARIABLE INTEREST ENTITIES
In the normal course of business, we enter into joint ventures or make investments with business partners that support our underlying business strategy and provide us the ability to enter new markets to expand the reach of our brands, develop new programming and/or distribute our existing content. In certain instances, an entity in which we make an investment may qualify as a variable interest entity (“VIE”). In determining whether we are the primary beneficiary of a VIE, we assess whether we have the power to direct matters that most significantly impact the activities of the VIE, and have the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE.

The following tables present the amounts recorded in our consolidated financial statements related to our consolidated VIEs.
AtAt
March 31, 2023December 31, 2022
Total assets$2,102 $1,961 
Total liabilities$391 $328 

-18-



CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

Three Months Ended
March 31,
20232022
Revenues$145 $103 
Operating loss$(31)$(28)
13) REPORTABLE SEGMENTS
9) STOCKHOLDERS’ EQUITY
Dividends
We declared a quarterly cash dividend of $.24 per share on our Class A and Class B Common Stock during each of the three-month periods ended March 31, 2023 and 2022, resulting in total dividends of $161 million and $159 million, respectively.

We declared a quarterly cash dividend of $1.4375 per share on our Mandatory Convertible Preferred Stock during each of the three-month periods ended March 31, 2023 and 2022, resulting in total dividends of $14.4 million for each of the respective periods.

Accumulated Other Comprehensive Income (Loss)
The following tables summarize the changes in the components of accumulated other comprehensive loss.
Continuing OperationsDiscontinued Operations
Cumulative
Translation
Adjustments		Net Actuarial
Loss and Prior
Service Cost
Other Comprehensive Income (Loss) (a)
Accumulated
Other
Comprehensive Loss
At December 31, 2022$(680)$(1,097)$(30)$(1,807)
Other comprehensive income before
reclassifications		52 — 2 54 
Reclassifications to net loss— 11 (b)— 11 
Other comprehensive income52 11 2 65 
At March 31, 2023$(628)$(1,086)$(28)$(1,742)
Continuing OperationsDiscontinued Operations
Cumulative
Translation
Adjustments		Net Actuarial
Loss and Prior
Service Cost
Other Comprehensive Income (Loss) (a)
Accumulated
Other
Comprehensive Loss
At December 31, 2021$(445)$(1,434)$(23)$(1,902)
Other comprehensive income (loss)
before reclassifications		(40)— 2 (38)
Reclassifications to net earnings— 16 (b)— 16 
Other comprehensive income (loss)(40)16 2 (22)
At March 31, 2022$(485)$(1,418)$(21)$(1,924)
(a) Reflects cumulative translation adjustments.
(b) Reflects amortization of net actuarial losses (see Note 11).
-19-


PARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)
The net actuarial loss and prior service cost related to pension and other postretirement benefit plans included in other comprehensive income (loss) is net of a tax benefit of $4 million and $5 million for the three months ended March 31, 2023 and 2022, respectively.
10) INCOME TAXES
The provision (benefit) for income taxes represents federal, state and local, and foreign taxes on earnings (loss) from continuing operations before income taxes and equity in loss of investee companies. For the three months endedMarch 31, 2023, we recorded a benefit for income taxes of $381 million, reflecting an effective income tax rate of 26.0%. The income tax benefit in the first quarter of 2023 is the result of a tax benefit of $409 million on programming charges of $1.67 billion recorded during the period and a net discrete tax benefit of $30 million, principally from the resolution of an income tax matter in a foreign jurisdiction. Together these items reduced our effective income tax rate by 1.5 percentage points.

For the three months ended March 31, 2022, we recorded a provision for income taxes of $34 million, reflecting an effective income tax rate of 7.2%. Included in the provision for income taxes for the three months ended March 31, 2022 is a net discrete tax benefit of $78 million primarily resulting from the transfer of intangible assets between our subsidiaries in connection with a reorganization of our international operations. This item, together with a net tax benefit of $25 million on other items identified as affecting the comparability of our results during the period (which include a loss on extinguishment of debt, restructuring and other corporate matters, and a gain on dispositions) reduced our effective income tax rate by 16.2 percentage points.

The Company and its subsidiaries file income tax returns with the Internal Revenue Service (“IRS”) and various state and local and foreign jurisdictions. For periods prior to the merger of Viacom Inc. (“Viacom”) with and into CBS Corporation (“CBS”) (the “Merger”), Viacom and CBS filed separate tax returns. For CBS, we are currently under examination by the IRS for the 2017 and 2018 tax years. For Viacom, we are currently under examination by the IRS for the 2016 through 2019 tax years. For tax returns filed as a merged company, we are currently under examination by the IRS for the 2019 tax year. Various tax years are also currently under examination by state and local and foreign tax authorities. With respect to open tax years in all jurisdictions, we currently do not believe that it is reasonably possible that the reserve for uncertain tax positions will significantly change within the next 12 months; however, it is difficult to predict the final outcome or timing of resolution of any particular tax matter and events could cause our current expectation to change in the future.
11) PENSION AND OTHER POSTRETIREMENT BENEFITS
The following table presents the components of net periodic cost for our pension and postretirement benefit plans.
Pension BenefitsPostretirement Benefits
Three Months Ended March 31,2023202220232022
Components of net periodic cost (a):
Interest cost$51 $38 $3 $2 
Expected return on plan assets(32)(43)— — 
Amortization of actuarial loss (gain) (b)
21 24 (4)(3)
Net periodic cost$40 $19 $(1)$(1)
(a) Amounts reflect our domestic plans only.
(b) Reflects amounts reclassified from accumulated other comprehensive loss to net earnings (loss).
-20-


PARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)
12) SEGMENT INFORMATION
The tables below set forth the Company’sour financial performanceinformation by reportable segment. The Company’sOur operating segments, which are the same as itsour reportable segments, have been determined in accordance with the Company’sour internal management structure, which is organized based upon products and services.

Three Months Ended Nine Months Ended

September 30, September 30,

2017 2016
2017 2016
Revenues:










Entertainment$1,815

$1,949

$6,346

$6,483
Cable Networks840

598

1,954

1,659
Publishing228

226

595

558
Local Media397
 409
 1,218
 1,253
Corporate/Eliminations(109)
(98)
(342)
(305)
Total Revenues$3,171

$3,084

$9,771

$9,648
Three Months Ended
March 31,
20232022
Revenues:
Advertising$2,256 $2,521 
Affiliate and subscription2,067 2,098 
Licensing and other870 1,026 
TV Media5,193 5,645 
Advertising398 347 
Subscription1,112 742 
Direct-to-Consumer1,510 1,089 
Advertising5 2 
Theatrical127 131 
Licensing and other456 491 
Filmed Entertainment588 624 
Eliminations(26)(30)
Total Revenues$7,265 $7,328 
Revenues generated between segments primarily reflectare principally from intersegment arrangements for the distribution of content, rental of studio space, and advertising, sales, televisionas well as licensing revenues earned from third parties who license fees and station affiliation fees.our content to our internal platforms either through a sub-license or co-production arrangement. These transactions are recorded at market value as if the sales were to third parties and are eliminated in consolidation. For content that is licensed between segments, content costs are allocated across segments based on the relative value of the distribution windows within each segment. Accordingly, no intersegment licensing revenues or profits are recorded by the licensor segment.
Three Months Ended
March 31,
20232022
Intercompany Revenues:
TV Media$13 $11 
Filmed Entertainment13 19 
Total Intercompany Revenues$26 $30 
-21-
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
Intercompany Revenues:       
Entertainment$111
 $102
 $348
 $316
Local Media4
 2
 10
 6
Total Intercompany Revenues$115
 $104
 $358
 $322




CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

The Company presentsWe present operating income (loss) excluding depreciation and amortization, stock-based compensation, costs for restructuring and other corporate matters, programming charges and other operating items, net,gain on dispositions, each where applicable (“Segment Operating Income”Adjusted OIBDA”), as the primary measure of profit and loss for itsour operating segments in accordance with FASB guidance for segment reporting. The Company believes the presentation of Segment Operating Incomereporting since it is relevant and useful for investors because it allows investors to view segment performance in a manner similar to the primary method used by the Company’s managementour management. Stock-based compensation is excluded from our segment measure of profit and enhances their ability to understand the Company’s operating performance.loss because it is set and approved by our Board of Directors in consultation with corporate executive management.
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
Segment Operating Income (Loss):       
Entertainment$345
 $348
 $1,089
 $1,148
Cable Networks294
 285
 795
 740
Publishing46
 44
 88
 83
Local Media105
 122
 355
 402
Corporate(83) (78) (247) (245)
Total Segment Operating Income707
 721
 2,080
 2,128
Other operating items, net (a)
—
 —
 —
 9
Operating income707

721

2,080

2,137
Interest expense(116) (104) (336) (304)
Interest income17
 7
 45
 22
Loss on early extinguishment of debt(5) —
 (5) —
Other items, net3
 —
 9
 (7)
Earnings from continuing operations before income taxes
and equity in loss of investee companies
606
 624
 1,793
 1,848
Provision for income taxes(172) (145) (479) (524)
Equity in loss of investee companies, net of tax(16) (13) (45) (43)
Net earnings from continuing operations418
 466
 1,269
 1,281
Net earnings (loss) from discontinued operations, net of tax174
 12
 (871) 93
Net earnings$592
 $478
 $398
 $1,374
Three Months Ended
March 31,
20232022
Adjusted OIBDA:
TV Media$1,306 $1,544 
Direct-to-Consumer(511)(456)
Filmed Entertainment(99)(37)
Corporate/Eliminations(109)(104)
Stock-based compensation (a)
(39)(34)
Depreciation and amortization(100)(96)
Programming charges(1,674)— 
Restructuring and other corporate matters— (57)
Gain on dispositions— 15 
Operating income (loss)(1,226)775 
Interest expense(226)(240)
Interest income35 21 
Loss on extinguishment of debt— (73)
Other items, net(46)(13)
Earnings (loss) from continuing operations before income taxes and
    equity in loss of investee companies		(1,463)470 
Benefit (provision) for income taxes381 (34)
Equity in loss of investee companies, net of tax(75)(37)
Net earnings (loss) from continuing operations(1,157)399 
Net earnings from discontinued operations, net of tax45 42 
Net earnings (loss) (Paramount and noncontrolling interests)(1,112)441 
Net earnings attributable to noncontrolling interests(6)(8)
Net earnings (loss) attributable to Paramount$(1,118)$433 
(a) Other operating items, net includes a gain fromFor the salethree months ended March 31, 2022, stock-based compensation expense of an internet business$2 million is included in China“Restructuring and a multiyear, retroactive impact of a new operating tax.other corporate matters”.

-22-
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
Depreciation and Amortization:       
Entertainment$29

$28

$85

$88
Cable Networks5

6

17

17
Publishing2

1

5

4
Local Media11
 11
 34
 33
Corporate8

8

25

26
Total Depreciation and Amortization$55

$54

$166

$168




CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

13) COMMITMENTS AND CONTINGENCIES
Guarantees
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
Stock-based Compensation:       
Entertainment$16
 $16
 $48
 $47
Cable Networks3
 3
 9
 9
Publishing1
 1
 3
 3
Local Media3
 3
 9
 9
Corporate21
 19
 60
 55
Total Stock-based Compensation$44
 $42
 $129
 $123
Letters of Credit and Surety Bonds
At March 31, 2023, we had outstanding letters of credit and surety bonds of $178 million that were not recorded on the Consolidated Balance Sheet. Letters of credit and surety bonds are primarily used as security against non-performance in the normal course of business.
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
Capital Expenditures:       
Entertainment$25

$23

$63

$60
Cable Networks5

4

12

8
Publishing1

1

2

7
Local Media8
 9
 20
 20
Corporate5
 5
 15
 16
Total Capital Expenditures$44
 $42
 $112
 $111
 At At
 September 30, 2017 December 31, 2016
Assets:       
Entertainment $12,149
   $11,262
 
Cable Networks 3,015
   2,618
 
Publishing 895
   880
 
Local Media 4,006
   4,065
 
Corporate/Eliminations 149
   817
 
Discontinued operations 3,680
   4,596
 
Total Assets $23,894
   $24,238
 




CBS CORPORATIONTelevision City
In connection with the sale of the CBS Television City property and sound stage operation (“CBS Television City”) in 2019, we guaranteed a specified level of cash flows to be generated by the business during the first five years following the completion of the sale. Included in “Other current liabilities” on the Consolidated Balance Sheet at March 31, 2023 is a liability totaling $25 million, reflecting the present value of the remaining estimated amount payable under the guarantee obligation.

Lease Guarantees
We have certain indemnification obligations with respect to leases primarily associated with the previously discontinued operations of Famous Players Inc. These lease commitments totaled $17 million at March 31, 2023, and are presented within “Other liabilities” on the Consolidated Balance Sheet. The amount of lease commitments varies over time depending on the expiration or termination of individual underlying leases, or the related indemnification obligation, and foreign exchange rates, among other things. We may also have exposure for certain other expenses related to the leases, such as property taxes and common area maintenance. We believe our accrual is sufficient to meet any future obligations based on our consideration of available financial information, the lessees’ historical performance in meeting their lease obligations and the underlying economic factors impacting the lessees’ business models.

Other
In the course of our business, we both provide and receive indemnities which are intended to allocate certain risks associated with business transactions. Similarly, we may remain contingently liable for various obligations of a business that has been divested in the event that a third party does not live up to its obligations under an indemnification obligation. We record a liability for our indemnification obligations and other contingent liabilities when probable and reasonably estimable.

Legal Matters
General
On an ongoing basis, we vigorously defend ourselves in numerous lawsuits and proceedings and respond to various investigations and inquiries from federal, state, local and international authorities (collectively, “Litigation”). Litigation may be brought against us without merit, is inherently uncertain and always difficult to predict. However, based on our understanding and evaluation of the relevant facts and circumstances, we believe that the following matters are not likely, in the aggregate, to result in a material adverse effect on our business, financial condition and results of operations.

-23-


PARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

Stockholder Matters
14) CONDENSED CONSOLIDATING FINANCIAL STATEMENTSLitigation Relating to the Merger
Beginning in February 2020, three purported CBS Operations Inc. is a wholly owned subsidiarystockholders filed separate derivative and/or putative class action lawsuits in the Court of Chancery of the Company.State of Delaware (the “Delaware Chancery Court”). In March 2020, the Delaware Chancery Court consolidated the three lawsuits and appointed Bucks County Employees Retirement Fund and International Union of Operating Engineers of Eastern Pennsylvania and Delaware as co-lead plaintiffs for the consolidated action captioned In re CBS Operations Inc. has fullyCorporation Stockholder Class Action and unconditionally guaranteed CBS Corp.’s senior debt securities. The following condensed consolidating financial statements presentDerivative Litigation (the “CBS Litigation”). In April 2020, the results of operations, financial positionlead plaintiffs filed a Verified Consolidated Class Action and cash flows of CBS Corp., CBS OperationsDerivative Complaint (as used in this paragraph, the “Complaint”) against Shari E. Redstone, National Amusements, Inc., Sumner M. Redstone National Amusements Trust, additional members of the directCBS Board of Directors (including Candace K. Beinecke, Barbara M. Byrne, Gary L. Countryman, Linda M. Griego, Robert N. Klieger, Martha L. Minow, Susan Schuman, Frederick O. Terrell and indirect Non-Guarantor Affiliates ofStrauss Zelnick), former CBS Corp.President and CBS Operations Inc.,Acting Chief Executive Officer Joseph Ianniello and the eliminations necessaryCompany as nominal defendant. The Complaint alleges breaches of fiduciary duties in connection with the negotiation and approval of an Agreement and Plan of Merger, dated as of August 13, 2019, between CBS and Viacom (as amended, the “Merger Agreement”). The Complaint also alleges waste and unjust enrichment in connection with certain aspects of Mr. Ianniello’s compensation awards. The Complaint seeks unspecified damages, costs and expenses, as well as other relief. In June 2020, the defendants filed motions to arrive atdismiss the informationComplaint. In January 2021, the Delaware Chancery Court dismissed one disclosure claim, while allowing all other claims against the defendants to proceed. On January 7, 2022, the Delaware Chancery Court granted Bucks County Employees Retirement Fund’s motion to withdraw as a co-lead plaintiff in the CBS Litigation. In December 2022, the Delaware Chancery Court dismissed the fiduciary duty claim against Mr. Klieger.

In April 2023, the parties to the CBS Litigation agreed to settle the CBS Litigation on the terms and conditions set forth in a binding term sheet (the “CBS Term Sheet”), which will be incorporated into a long-form settlement agreement that will be subject to the final approval of the Delaware Chancery Court. The CBS Term Sheet provides for, among other things, the final dismissal of the CBS Litigation in exchange for a settlement payment to the Company in the amount of $167.5 million, less administrative costs and plaintiffs’ counsels’ fees and expenses.

Beginning in November 2019, four purported Viacom stockholders filed separate putative class action lawsuits in the Delaware Chancery Court. In January 2020, the Delaware Chancery Court consolidated the four lawsuits. In February 2020, the Delaware Chancery Court appointed California Public Employees’ Retirement System (“CalPERS”) as lead plaintiff for the Companyconsolidated action. Subsequently, in February 2020, CalPERS, together with Park Employees’ and Retirement Board Employees’ Annuity and Benefit Fund of Chicago and Louis M. Wilen, filed a First Amended Verified Class Action Complaint (as used in this paragraph, the “Complaint”) against NAI, NAI Entertainment Holdings LLC, Shari E. Redstone, the members of the special transaction committee of the Viacom Board of Directors (comprised of Thomas J. May, Judith A. McHale, Ronald L. Nelson and Nicole Seligman) and our President and Chief Executive Officer and director, Robert M. Bakish (as used in this paragraph, the “Viacom Litigation”). The Complaint alleges breaches of fiduciary duties to Viacom stockholders in connection with the negotiation and approval of the Merger Agreement. The Complaint seeks unspecified damages, costs and expenses, as well as other relief. In May 2020, the defendants filed motions to dismiss. In December 2020, the Delaware Chancery Court dismissed the claims against Mr. Bakish, while allowing the claims against the remaining defendants to proceed. In February 2023, the parties to the Viacom Litigation agreed to settle the Viacom Litigation on the terms and conditions set forth in a consolidated basis.binding term sheet (the “Viacom Term Sheet”), which was incorporated into a long-form settlement agreement entered into in March 2023 (the “Settlement Agreement”). The Viacom Term Sheet and Settlement Agreement provide for, among other things, the final dismissal of the Viacom Litigation in exchange for a settlement payment in the amount of $122.5 million, which
-24-
 Statement of Operations
 For the Three Months Ended September 30, 2017
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Revenues$40
 $3
 $3,128
 $—
 $3,171
Costs and expenses:         
Operating23
 1
 1,838
 —
 1,862
Selling, general and administrative22
 62
 463
 —
 547
Depreciation and amortization1
 6
 48
 —
 55
Total costs and expenses46
 69
 2,349
 —
 2,464
Operating income (loss)(6) (66) 779
 —
 707
Interest (expense) income, net(129) (123) 153
 —
 (99)
Loss on early extinguishment of debt(5) —
 —
 —
 (5)
Other items, net—
 (8) 11
 —
 3
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of investee companies(140) (197) 943
 —
 606
Benefit (provision) for income taxes43
 62
 (277) —
 (172)
Equity in earnings (loss) of investee companies, net of tax689
 369
 (16) (1,058) (16)
Net earnings from continuing operations592
 234
 650
 (1,058) 418
Net earnings from discontinued operations, net of tax—
 —
 174
 —
 174
Net earnings$592
 $234
 $824
 $(1,058) $592
Total comprehensive income$607

$229

$830

$(1,059) $607




CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

we have recorded in "Other current liabilities" on the Consolidated Balance Sheets. The settlement of the Viacom Litigation is subject to the final approval of the Delaware Chancery Court, and the vast majority of the settlement payment will be due no less than five business days before the final settlement hearing.

Litigation Related to Stock Offerings
In August 2021, Camelot Event Driven Fund filed a putative securities class action lawsuit in New York Supreme Court, County of New York, and in November 2021, an amended complaint was filed that, among other changes, added an additional named plaintiff (as used in this paragraph,the “Complaint”). The Complaint is purportedly on behalf of investors who purchased shares of the Company’s Class B Common Stock and 5.75% Series A Mandatory Convertible Preferred Stock pursuant to public securities offerings completed in March 2021, and was filed against the Company, certain senior executives, members of our Board of Directors, and the underwriters involved in the offerings. The Complaint asserts violations of federal securities law and alleges that the offering documents contained material misstatements and omissions, including through an alleged failure to adequately disclose certain total return swap transactions involving Archegos Capital Management referenced to our securities and related alleged risks to the Company’s stock price. In December 2021, the plaintiffs filed a stipulation seeking the voluntary dismissal without prejudice of the outside director defendants from the lawsuit, which the Court subsequently ordered. On the same date, the defendants filed motions to dismiss the lawsuit, which were heard in January 2023. On February 7, 2023, the Court dismissed all claims against the Company while allowing the claims against the underwriters to proceed. The plaintiffs and underwriter defendants have appealed the ruling.

Litigation Related to Television Station Owners
In September 2019, the Company was added as a defendant in a multi-district putative class action lawsuit filed in the United States District Court for the Northern District of Illinois. The lawsuit was filed by parties that claim to have purchased broadcast television spot advertising beginning about January 2014 on television stations owned by one or more of the defendant television station owners and alleges the sharing of allegedly competitively sensitive information among such television stations in alleged violation of the Sherman Antitrust Act. The action, which names the Company among fourteen total defendants, seeks monetary damages, attorneys’ fees, costs and interest as well as injunctions against the allegedly unlawful conduct. In October 2019, the Company and other defendants filed a motion to dismiss the matter, which was denied by the Court in November 2020. We have reached an agreement in principle with the plaintiffs to settle the lawsuit. The settlement, which will include no admission of liability or wrongdoing by the Company, will be subject to Court approval.

Claims Related to Former Businesses
Asbestos
We are a defendant in lawsuits claiming various personal injuries related to asbestos and other materials, which allegedly occurred as a result of exposure caused by various products manufactured by Westinghouse, a predecessor, generally prior to the early 1970s. Westinghouse was neither a producer nor a manufacturer of asbestos. We are typically named as one of a large number of defendants in both state and federal cases. In the majority of asbestos lawsuits, the plaintiffs have not identified which of our products is the basis of a claim. Claims against us in which a product has been identified most commonly relate to allegations of exposure to asbestos-containing insulating material used in conjunction with turbines and electrical equipment.

Claims are frequently filed and/or settled in groups, which may make the amount and timing of settlements, and the number of pending claims, subject to significant fluctuation from period to period. We do not report as pending those claims on inactive, stayed, deferred or similar dockets that some jurisdictions have established for claimants who allege minimal or no impairment. As of March 31, 2023, we had pending approximately 21,640 asbestos
-25-
 Statement of Operations
 For the Nine Months Ended September 30, 2017
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Revenues$124
 $8
 $9,639
 $—
 $9,771
Costs and expenses:         
Operating69
 4
 5,867
 —
 5,940
Selling, general and administrative65
 194
 1,326
 —
 1,585
Depreciation and amortization3
 18
 145
 —
 166
Total costs and expenses137
 216
 7,338
 —
 7,691
Operating income (loss)(13) (208) 2,301
 —
 2,080
Interest (expense) income, net(378) (360) 447
 —
 (291)
Loss on early extinguishment of debt(5) —
 —
 —
 (5)
Other items, net1
 (33) 41
 —
 9
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of investee companies(395) (601) 2,789
 —
 1,793
Benefit (provision) for income taxes120
 184
 (783) —
 (479)
Equity in earnings (loss) of investee companies, net of tax673
 1,062
 (45) (1,735) (45)
Net earnings from continuing operations398
 645
 1,961
 (1,735) 1,269
Net loss from discontinued operations, net of tax—
 —
 (871) —
 (871)
Net earnings$398
 $645
 $1,090
 $(1,735) $398
Total comprehensive income$439

$633

$1,111

$(1,744) $439





CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

claims, as compared with approximately 21,580 as of December 31, 2022. During the first quarter of 2023, we received approximately 650 new claims and closed or moved to an inactive docket approximately 590 claims. We report claims as closed when we become aware that a dismissal order has been entered by a court or when we have reached agreement with the claimants on the material terms of a settlement. Settlement costs depend on the seriousness of the injuries that form the basis of the claims, the quality of evidence supporting the claims and other factors. Our total costs for the years 2022 and 2021 for settlement and defense of asbestos claims after insurance recoveries and net of tax were approximately $57 million and $63 million, respectively. Our costs for settlement and defense of asbestos claims may vary year to year and insurance proceeds are not always recovered in the same period as the insured portion of the expenses.

Filings include claims for individuals suffering from mesothelioma, a rare cancer, the risk of which is allegedly increased by exposure to asbestos; lung cancer, a cancer which may be caused by various factors, one of which is alleged to be asbestos exposure; other cancers, and conditions that are substantially less serious, including claims brought on behalf of individuals who are asymptomatic as to an allegedly asbestos-related disease. The predominant number of pending claims against us are non-cancer claims. It is difficult to predict future asbestos liabilities, as events and circumstances may impact the estimate of our asbestos liabilities, including, among others, the number and types of claims and average cost to resolve such claims. We record an accrual for a loss contingency when it is both probable that a liability has been incurred and when the amount of the loss can be reasonably estimated. Our liability estimate is based upon many factors, including the number of outstanding claims, estimated average cost per claim, the breakdown of claims by disease type, historic claim filings, costs per claim of resolution and the filing of new claims, as well as consultation with a third party firm on trends that may impact our future asbestos liability. While we believe that our accrual for matters related to our predecessor operations, including environmental and asbestos, are adequate, there can be no assurance that circumstances will not change in future periods, and as a result our actual liabilities may be higher or lower than our accrual.

Other
From time to time, we receive claims from federal and state environmental regulatory agencies and other entities asserting that we are or may be liable for environmental cleanup costs and related damages principally relating to our historical and predecessor operations. In addition, from time to time we receive personal injury claims including toxic tort and product liability claims (other than asbestos) arising from our historical operations and predecessors.
14) SUPPLEMENTAL FINANCIAL INFORMATION
Supplemental Cash Flow Information
Three Months Ended
March 31,
20232022
Cash paid for interest$275 $292 
Cash paid (received) for income taxes:
Continuing operations$(8)$45 
Discontinued operations$2 $5 
Noncash additions to operating lease assets$58 $68 
Lease Income
We enter into operating leases for the use of our owned production facilities and office buildings. Lease payments received under these agreements consist of fixed payments for the rental of space and certain building operating
-26-
 Statement of Operations
 For the Three Months Ended September 30, 2016
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Revenues$42
 $3
 $3,039
 $—
 $3,084
Costs and expenses:         
Operating16
 1
 1,771
 —
 1,788
Selling, general and administrative20
 62
 439
 —
 521
Depreciation and amortization2
 6
 46
 —
 54
Total costs and expenses38
 69
 2,256
 —
 2,363
Operating income (loss)4
 (66) 783
 —
 721
Interest (expense) income, net(129) (109) 141
 —
 (97)
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of investee companies(125) (175) 924
 —
 624
Benefit (provision) for income taxes43
 60
 (248) —
 (145)
Equity in earnings (loss) of investee companies, net of tax560
 327
 (13) (887) (13)
Net earnings from continuing operations478
 212
 663
 (887) 466
Net earnings (loss) from discontinued operations, net of tax—
 (1) 13
 —
 12
Net earnings$478
 $211
 $676
 $(887) $478
Total comprehensive income$489
 $215
 $675
 $(890) $489




CBS CORPORATIONPARAMOUNT GLOBAL AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

costs, as well as variable payments based on usage of production facilities and services, and escalating costs of building operations. We recorded total lease income, including both fixed and variable amounts, of $14 million and $15 million for the three months ended March 31, 2023 and 2022, respectively.

Restructuring and Other Corporate Matters
At March 31, 2023 and December 31, 2022, our restructuring liability was $250 million and $302 million, respectively, and was recorded in “Other current liabilities” and “Other liabilities” on the Consolidated Balance Sheets. During the three months ended March 31, 2023, we made payments for restructuring of $53 million. The majority of the restructuring liability at March 31, 2023, which principally relates to severance payments, is expected to be paid by the end of 2023.

During the three months ended March 31, 2022, we recorded restructuring charges of $18 million within the Filmed Entertainment segment for severance costs primarily associated with management changes following our operating segment realignment, and a charge of $39 million following Russia’s invasion of Ukraine, principally to reserve against amounts due from counterparties in Russia, Belarus and Ukraine.

-27-
 Statement of Operations
 For the Nine Months Ended September 30, 2016
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Revenues$125
 $9
 $9,514
 $—
 $9,648
Costs and expenses:         
Operating48
 4
 5,766
 —
 5,818
Selling, general and administrative62
 194
 1,278
 —
 1,534
Depreciation and amortization4
 17
 147
 —
 168
Other operating items, net—
 —
 (9) —
 (9)
Total costs and expenses114
 215
 7,182
 —
 7,511
Operating income (loss)11
 (206) 2,332
 —
 2,137
Interest (expense) income, net(377) (319) 414
 —
 (282)
Other items, net(2) 3
 (8) —
 (7)
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of investee companies(368) (522) 2,738
 —
 1,848
Benefit (provision) for income taxes120
 170
 (814) —
 (524)
Equity in earnings (loss) of investee companies, net of tax1,622
 876
 (43) (2,498) (43)
Net earnings from continuing operations1,374
 524
 1,881
 (2,498) 1,281
Net earnings (loss) from discontinued operations, net of tax—
 (1) 94
 —
 93
Net earnings$1,374
 $523
 $1,975
 $(2,498) $1,374
Total comprehensive income$1,405
 $540
 $1,965
 $(2,505) $1,405



CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

 Balance Sheet
 At September 30, 2017
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Assets         
Cash and cash equivalents$18
 $—
 $126
 $—
 $144
Receivables, net24
 1
 3,573
 —
 3,598
Programming and other inventory3
 3
 1,824
 —
 1,830
Prepaid expenses and other current assets8
 25
 370
 (36) 367
Current assets of discontinued operations—
 —
 355
 —
 355
Total current assets53
 29
 6,248
 (36) 6,294
Property and equipment48
 207
 2,746
 —
 3,001
Less accumulated depreciation and amortization27
 158
 1,608
 —
 1,793
Net property and equipment21
 49
 1,138
 —
 1,208
Programming and other inventory3
 5
 2,806
 —
 2,814
Goodwill98
 62
 4,731
 —
 4,891
Intangible assets—
 —
 2,617
 —
 2,617
Investments in consolidated subsidiaries45,155
 14,915
 —
 (60,070) —
Other assets154
 8
 2,583
 —
 2,745
Intercompany—
 1,331
 28,353
 (29,684) —
Assets of discontinued operations—
 —
 3,325
 —
 3,325
Total Assets$45,484
 $16,399
 $51,801
 $(89,790) $23,894
Liabilities and Stockholders’ Equity         
Accounts payable$1
 $3
 $229
 $—
 $233
Participants’ share and royalties payable—
 —
 997
 —
 997
Program rights4
 3
 502
 —
 509
Commercial paper590
 —
 —
 —
 590
Current portion of long-term debt2
 —
 17
 —
 19
Accrued expenses and other current liabilities374
 219
 993
 (36) 1,550
Current liabilities of discontinued operations—
 —
 154
 —
 154
Total current liabilities971
 225
 2,892
 (36) 4,052
Long-term debt8,991
 —
 89
 —
 9,080
Other liabilities2,844
 237
 2,221
 —
 5,302
Liabilities of discontinued operations—
 —
 2,466
 —
 2,466
Intercompany29,684
 —
 —
 (29,684) —
Stockholders’ Equity:         
Preferred stock—
 —
 126
 (126) —
Common stock1
 123
 590
 (713) 1
Additional paid-in capital43,830
 —
 60,894
 (60,894) 43,830
Retained earnings (accumulated deficit)(18,859) 16,128
 (12,748) (3,380) (18,859)
Accumulated other comprehensive income (loss)(726) 17

71

(88) (726)
 24,246
 16,268
 48,933
 (65,201) 24,246
Less treasury stock, at cost21,252
 331
 4,800
 (5,131) 21,252
Total Stockholders’ Equity2,994
 15,937
 44,133
 (60,070) 2,994
Total Liabilities and Stockholders’ Equity$45,484
 $16,399
 $51,801
 $(89,790) $23,894


CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

 Balance Sheet
 At December 31, 2016
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Assets         
Cash and cash equivalents$321
 $—
 $277
 $—
 $598
Receivables, net27
 2
 3,285
 —
 3,314
Programming and other inventory3
 3
 1,421
 —
 1,427
Prepaid expenses and other current assets102
 55
 297
 (35) 419
Current assets of discontinued operations—
 —
 305
 —
 305
Total current assets453

60

5,585

(35)
6,063
Property and equipment47
 201
 2,687
 —
 2,935
Less accumulated depreciation and amortization25
 140
 1,529
 —
 1,694
Net property and equipment22

61

1,158

—
 1,241
Programming and other inventory5
 7
 2,427
 —
 2,439
Goodwill98
 62
 4,704
 —
 4,864
Intangible assets—
 —
 2,633
 —
 2,633
Investments in consolidated subsidiaries44,473
 13,853
 —
 (58,326) —
Other assets150
 8
 2,549
 —
 2,707
Intercompany—
 1,785
 26,976
 (28,761) —
Assets of discontinued operations—
 3
 4,288
 —
 4,291
Total Assets$45,201

$15,839

$50,320

$(87,122) $24,238
Liabilities and Stockholders’ Equity
         
Accounts payable$1
 $3
 $144
 $—
 $148
Participants’ share and royalties payable—
 —
 1,024
 —
 1,024
Program rights4
 4
 282
 —
 290
Commercial paper450
 —
 —
 —
 450
Current portion of long-term debt6
 —
 17
 —
 23
Accrued expenses and other current liabilities421
 284
 948
 (35) 1,618
Current liabilities of discontinued operations—
 —
 155
 —
 155
Total current liabilities882

291

2,570

(35) 3,708
Long-term debt8,798
 —
 104
 —
 8,902
Other liabilities3,071
 244
 2,173
 —
 5,488
Liabilities of discontinued operations—
 —
 2,451
 —
 2,451
Intercompany28,761
 —
 —
 (28,761) —
Stockholders’ Equity:        

Preferred stock—
 —
 126
 (126) —
Common stock1
 123
 590
 (713) 1
Additional paid-in capital43,913
 —
 60,894
 (60,894) 43,913
Retained earnings (accumulated deficit)(19,257) 15,483
 (13,838) (1,645) (19,257)
Accumulated other comprehensive income (loss)(767) 29
 50
 (79) (767)
 23,890

15,635

47,822

(63,457) 23,890
Less treasury stock, at cost20,201
 331
 4,800
 (5,131) 20,201
Total Stockholders’ Equity3,689
 15,304
 43,022
 (58,326) 3,689
Total Liabilities and Stockholders’ Equity$45,201

$15,839

$50,320

$(87,122) $24,238


CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

 Statement of Cash Flows
 For the Nine Months Ended September 30, 2017
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Net cash flow (used for) provided by operating activities$(851) $(180) $2,018
 $—
 $987
Investing Activities:         
Acquisitions (including acquired television library)—
 —
 (258) —
 (258)
Capital expenditures—
 (15) (97) —
 (112)
Investments in and advances to investee companies—
 —
 (67) —
 (67)
Proceeds from sale of investments—
 —
 10
 —
 10
Proceeds from dispositions—
 —
 11
 —
 11
Other investing activities17
 —
 —
 —
 17
Net cash flow provided by (used for) investing activities from continuing operations17
 (15) (401) —
 (399)
Net cash flow provided by (used for) investing activities from discontinued operations1
 (4) (15) —
 (18)
Net cash flow provided by (used for) investing activities18
 (19) (416) —
 (417)
Financing Activities:         
Proceeds from short-term debt borrowings, net140
 —
 —
 —
 140
Proceeds from issuance of senior notes889
 —
 —
 —
 889
Repayment of senior notes(701) —
 —
 —
 (701)
Proceeds from debt borrowings of CBS Radio—
 —
 40
 —
 40
Repayment of debt borrowings of CBS Radio—
 —
 (23) —
 (23)
Payment of capital lease obligations—
 —
 (13) —
 (13)
Payment of contingent consideration—
 —
 (7) ���
 (7)
Dividends(224) —
 —
 —
 (224)
Purchase of Company common stock(1,111) —
 —
 —
 (1,111)
Payment of payroll taxes in lieu of issuing
shares for stock-based compensation
(89) —
 —
 —
 (89)
Proceeds from exercise of stock options81
 —
 —
 —
 81
Increase (decrease) in intercompany payables1,545
 199
 (1,744) —
 —
Net cash flow provided by (used for) financing activities530
 199
 (1,747) —
 (1,018)
Net decrease in cash and cash equivalents(303) —
 (145) —
 (448)
Cash and cash equivalents at beginning of period
(includes $24 million of discontinued operations cash)
321
 —
 301
 —
 622
Cash and cash equivalents at end of period
(includes $30 million of discontinued operations cash)
$18
 $—
 $156
 $—
 $174


CBS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Tabular dollars in millions, except per share amounts)

 Statement of Cash Flows
 For the Nine Months Ended September 30, 2016
 CBS Corp. 
CBS
Operations
Inc.
 
Non-
Guarantor
Affiliates
 Eliminations 
CBS Corp.
Consolidated
Net cash flow (used for) provided by operating activities$(696) $(146) $2,148
 $—
 $1,306
Investing Activities:        

Acquisitions—
 —
 (51) —
 (51)
Capital expenditures—
 (16) (95) —
 (111)
Investments in and advances to investee companies—
 —
 (44) —
 (44)
Proceeds from dispositions(4) —
 24
 —
 20
Other investing activities7
 —
 —
 —
 7
Net cash flow provided by (used for) investing activities from continuing operations3

(16)
(166)
—
 (179)
Net cash flow used for investing activities from discontinued operations—
 —
 (2) —
 (2)
Net cash flow provided by (used for) investing activities3

(16)
(168)
—
 (181)
Financing Activities:        

Proceeds from short-term borrowings, net33
 —
 —
 —
 33
Proceeds from issuance of senior notes685
 —
 —
 —
 685
Repayment of senior debentures(199) —
 —
 —
 (199)
Payment of capital lease obligations—
 —
 (13) —
 (13)
Dividends(209) —
 —
 —
 (209)
Purchase of Company common stock(1,534) —
 —
 —
 (1,534)
Payment of payroll taxes in lieu of issuing
shares for stock-based compensation
(57) —
 —
 —
 (57)
Proceeds from exercise of stock options13
 —
 —
 —
 13
Excess tax benefit from stock-based compensation13
 —
 —
 —
 13
Other financing activities(1) —
 —
 —
 (1)
Increase (decrease) in intercompany payables1,736
 162
 (1,898) —
 —
Net cash flow provided by (used for) financing activities480
 162
 (1,911) —
 (1,269)
Net (decrease) increase in cash and cash equivalents(213)
—

69

—
 (144)
Cash and cash equivalents at beginning of period
(includes $6 million of discontinued operations cash)
267
 1
 55
 —
 323
Cash and cash equivalents at end of period
(includes $1 million of discontinued operations cash)
$54

$1

$124

$—
 $179



Item 2.Management’s Discussion and Analysis of Results of Operations and Financial Condition.
(Tabular dollars in millions, except per share amounts)
Management’s discussion and analysis of the results of operations and financial condition of CBS Corporation (the “Company” or “CBS Corp.”)Paramount Global should be read in conjunction with the consolidated financial statements and related notes in the Company’sour Annual Report filed on Form 10-K for the fiscal year ended December 31, 2016.2022. References in this document to “Paramount,” the “Company,” “we,” “us” and “our” refer to Paramount Global.


Significant components of management’s discussion and analysis of results of operations and financial condition include:
•Overview—Summary of our business and operational highlights.

Business overview and strategy
The Company operates businesses which span the media and entertainment industries, including the CBS Television Network, cable networks, content production and distribution, television stations, internet-based businesses, and consumer publishing. The Company’s principal strategy is to create and acquire premium content that is widely accepted by audiences and generate both advertising and non-advertising revenues from the distribution•Consolidated Results of this contentOperations—Analysis of our results on multiple media platforms and to various geographic locations. The Company continues to increase its investment in both Company-owned and acquired premium content to enhance its opportunitiesa consolidated basis for revenue growth, which include exhibiting the Company’s content on multiple digital platforms, including the Company’s owned digital streaming services as well as third-party live television streaming offerings; expanding the distribution of its content internationally; and securing compensation from multichannel video programming distributors (“MVPDs”) and television stations affiliated with the CBS Television Network. The Company also seeks to grow its advertising revenues by monetizing all content viewership as industry measurements evolve to reflect viewers’ changing habits. The Company’s continued ability to capitalize on these and other emerging opportunities will provide it with incremental advertising and non-advertising revenues.

Operational highlights - Three Months Ended September 30, 2017 versusThree Months Ended September 30, 2016
Consolidated results of operations    Increase/(Decrease) 
Three Months Ended September 30,2017
2016 $ % 
GAAP:        
Revenues$3,171
 $3,084
 $87
 3 % 
Operating income$707
 $721
 $(14) (2)% 
Net earnings from continuing operations$418
 $466
 $(48) (10)% 
Net earnings$592
 $478
 $114
 24 % 
Diluted EPS from continuing operations$1.03
 $1.04
 $(.01) (1)% 
Diluted EPS$1.46
 $1.07
 $.39
 36 % 
         
Non-GAAP: (a)
        
Adjusted net earnings from continuing operations$421
 $419
 $2
 — % 
Adjusted net earnings$450
 $467
 $(17) (4)% 
Adjusted diluted EPS from continuing operations$1.04
 $.94
 $.10
 11 % 
Adjusted diluted EPS$1.11
 $1.05
 $.06
 6 % 
(a) See pages 37 - 38 for reconciliations of adjusted results to the most directly comparable financial measures in accordance with accounting principles generally accepted in the United States (“GAAP”).
For the three months ended September 30, 2017,March 31, 2023 compared with the 3% increase in revenues reflects 52% higher affiliatethree months ended March 31, 2022.
•Segment Results of Operations—Analysis of our results on a reportable segment basis for the three months ended March 31, 2023 compared with the three months ended March 31, 2022.
•Liquidity and subscription fee revenues,Capital Resources—Discussion of our cash flows, including sources and uses of cash, for the three months ended March 31, 2023 and March 31, 2022; and of our outstanding debt as of March 31, 2023.
•Legal Matters—Discussion of legal matters to which was driven by Showtime Networks’ distribution of the Floyd Mayweather/Conor McGregor pay-per-view boxing event, 27% growth in station affiliation fees and retransmission revenues, and growth from new digital initiatives, including the Company’s owned streaming subscription services, CBS All Access and the Showtime digital streaming subscription offering, and third-party live television streaming services. Content licensing and distribution revenues decreased 22%, as a result of the timing of domestic licensing sales, partially offset by growth in international television licensing. Advertising revenues decreased 5% driven by lower political advertising sales and lower ratings, partially offset by higher pricing.we are involved.





-28-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Overview
Operating income for the three months ended September 30, 2017 decreased 2% and the operating income margin decreased one point to 22% for the third quarterOperational Highlights - Three Months Ended March 31, 2023 versusThree Months Ended March 31, 2022
Consolidated results of operationsIncrease/(Decrease)
Three Months Ended March 31,20232022$%
GAAP:
Revenues$7,265 $7,328 $(63)(1)%
Operating income (loss)$(1,226)$775 $(2,001)n/m
Net earnings (loss) from continuing operations
attributable to Paramount
$(1,163)$391 $(1,554)n/m
Diluted EPS from continuing operations$(1.81)$.58 $(2.39)n/m
Non-GAAP: (a)
Adjusted OIBDA$548 $913 $(365)(40)%
Adjusted net earnings from continuing operations
attributable to Paramount
$72 $403 $(331)(82)%
Adjusted diluted EPS from continuing operations$.09 $.60 $(.51)(85)%
n/m - not meaningful
(a) Certain items identified as affecting comparability are excluded in non-GAAP results. See “Reconciliation of 2017 from 23% for the third quarter of 2016, mainly as a result of the mix of revenues. Results for 2017 included lower-margin revenues from the pay-per-view boxing event and 2016 included a larger volume of higher-margin political advertising and television licensing revenues.

Net earnings from continuing operations decreased 10% and diluted earnings per share (“EPS”) from continuing operations decreased 1%, reflecting lower operating income as well as a one-time tax benefit of $47 million in the third quarter of 2016 associated with a multiyear adjustment to a tax deduction. Adjusted net earnings from continuing operations for the third quarter of 2017 were comparable with the same prior-year period. Adjusted diluted EPS from continuing operations increased 11%, benefiting from lower weighted average shares outstanding in the third quarter of 2017 as a result of the Company’s ongoing share repurchase program. Net earnings for the three months ended September 30, 2017 of $592 million included, in discontinued operations, a noncash gain of $100 million, or $.25 per diluted share, to adjust the carrying value of CBS Radio Inc. (“CBS Radio”) to the value indicated by the stock valuation of Entercom Communications Corp. (“Entercom”). CBS Radio is classified as held for sale and therefore, in accordance with Financial Accounting Standards Board (“FASB”) guidance, its carrying value is adjusted based on the trading price of Entercom’s stock, which will result in an additional gain or loss at the time of the closing of the transaction with Entercom. Adjusted net earnings from continuing operations and Adjusted diluted EPS from continuing operations are non-GAAP financial measures. See pages 37 - 38Non-GAAP Measures” for details of the discretethese items excluded from financial results, and reconciliations of adjustednon-GAAP results to the most directly comparable financial measures in accordance with GAAP.accounting principles generally accepted in the United States (“GAAP”).

Operational highlights - Nine Months Ended September 30, 2017 versusNine Months Ended September 30, 2016
Consolidated results of operations    Increase/(Decrease) 
Nine Months Ended September 30,2017 2016 $ % 
GAAP:        
Revenues$9,771
 $9,648
 $123
 1 % 
Operating income$2,080
 $2,137
 $(57) (3)% 
Net earnings from continuing operations$1,269
 $1,281
 $(12) (1)% 
Net earnings$398
 $1,374
 $(976) (71)% 
Diluted EPS from continuing operations$3.10
 $2.82
 $.28
 10 % 
Diluted EPS$.97
 $3.02
 $(2.05) (68)% 
         
Non-GAAP: (a)
        
Adjusted operating income$2,080
 $2,128
 $(48) (2)% 
Adjusted net earnings from continuing operations$1,250
 $1,235
 $15
 1 % 
Adjusted net earnings$1,318
 $1,364
 $(46) (3)% 
Adjusted diluted EPS from continuing operations$3.05
 $2.71
 $.34
 13 % 
Adjusted diluted EPS$3.21
 $3.00
 $.21
 7 % 
(a) See pages 38 - 39 for reconciliations of adjusted results to the most directly comparable financial measures in accordance with GAAP.
For the ninethree months endedSeptember 30, 2017, March 31, 2023, revenues increaseddecreased 1% to $7.27 billion, as lower revenues from our linear networks and the licensing of our content were substantially offset by growth in revenues from our streaming services, led by Paramount+. The decline for our linear networks principally reflects weakness in the global advertising market.

We reported an operating loss of $1.23 billion for the three months ended March 31, 2023 compared with operating income of $775 million for the comparable prior-year period. The comparison was impacted by programming charges of $1.67 billion recorded during the first quarter of 2023. Adjusted operating income before depreciation and amortization (“Adjusted OIBDA”), which excludes these charges, as well as other items described under Reconciliation of Non-GAAP Measures, decreased 40%, driven by 28%the decline in revenue and higher affiliate and subscription fee revenues, ledcosts principally associated with investment in our streaming services.

For the three months ended March 31, 2023, we reported a net loss from continuing operations attributable to Paramount of $1.16 billion, or $1.81 per diluted share, compared with net earnings from continuing operations attributable to Paramount of $391 million, or $.58 per diluted share, for the same prior-year period. The comparison was impacted by Showtime Networks’ distribution of the Floyd Mayweather/Conor McGregor pay-per-view boxing event, a 27% increase in station affiliation fees and retransmission revenues, and growth from new digital initiatives, including the Company’s owned streaming subscription services, CBS All Accessprogramming charges noted above and the Showtime digital streaming subscription service,other items described under Reconciliation of Non-GAAP Measures for the applicable period. Adjusted net earnings from continuing operations attributable to Paramount and third-party live television streaming services. This growth was offset byadjusted diluted EPS, which exclude these items, decreased 82% and 85%, respectively, primarily reflecting the benefit to 2016 from CBS’s broadcast of Super Bowl 50.lower Adjusted OIBDA.

-29-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Operating income decreased 3% for the nine months endedSeptember 30, 2017, primarily as a result of a mix of lower-margin revenues in 2017 compared to 2016. Net earnings from continuing operations decreased 1% mainly as a result of the lower operating income. Diluted EPS from continuing operations increased 10% due to lower weighted average shares outstanding in 2017 as a result of the Company’s ongoing share repurchase program. Adjusted net earnings from continuing operations and adjusted diluted EPS from continuing operations increased 1% and 13%, respectively. Net earnings for the nine months ended September 30, 2017of$398 million included a noncash charge of $980 million, or $2.39 per diluted share, in discontinued operations to reduce the carrying value of CBS Radio to the value indicated by the stock valuation of Entercom. CBS Radio is classified as held for sale and therefore, in accordance with FASB guidance, its carrying value is adjusted based on the trading price of Entercom’s stock, which will result in an additional gain or loss at the time of the closing of the transaction with Entercom. See pages 38 - 39 for details of the discrete items excluded from financial results, and reconciliations of adjusted results to the most directly comparable financial measures in accordance with GAAP.
The Company generated operating cash flow from continuing operations of $935 million for the nine months endedSeptember 30, 2017 compared with $1.12 billion for the nine months ended September 30, 2016. Free cash flow for the nine months endedSeptember 30, 2017 was $823 million compared with $1.01 billion for the same prior-year period. These decreases were driven by the decline in advertising revenues including from the benefit in 2016 from CBS’s broadcast of Super Bowl 50, and discretionary pension contributions of $100 million made during the first quarter of 2017 to prefund the Company’s qualified plans. Free cash flow for the three and nine months ended September 30, 2017 benefited from higher affiliate and subscription fee revenues. Free cash flow is a non-GAAP financial measure. See “Free Cash Flow” on pages 54 - 55 for a reconciliation of net cash flow provided by (used for) operating activities, the most directly comparable GAAP financial measure, to free cash flow.

Recent Developments
On October 19, 2017, the Company commenced an exchange offer for the split-off of its radio business, CBS Radio, as part of its previously announced agreement to combine CBS Radio with Entercom in a merger. In the exchange offer, the Company’s stockholders will have the opportunity to exchange their shares of the Company’s Class B Common Stock for shares of CBS Radio common stock, which will be immediately converted into shares of Entercom Class A common stock upon completion of the merger, which is subject to certain customary terms and conditions. The exchange offer is scheduled to expire on November 16, 2017, unless the exchange offer is extended or terminated.
Share Repurchases and Dividends

During the third quarter of 2017, the Company repurchased 3.9 million shares of its Class B Common Stock under its share repurchase program for $250 million, at an average cost of $63.52 per share. During the nine months ended September 30, 2017, the Company repurchased 16.2 million shares of its Class B Common Stock for $1.05 billion, at an average cost of $64.70 per share, leaving $3.06 billion of authorization at September 30, 2017.

During the third quarter of 2017, the Company declared a quarterly cash dividend of $.18 on its Class A and Class B Common Stock, resulting in total dividends of $73 million, which were paid on October 1, 2017.

Planned Pension Settlement
On November 1, 2017, the Company entered into a definitive agreement to purchase a group annuity contract, under which an insurance company will be required to pay and administer pension payments to certain of the Company’s pension plan participants, or their designated beneficiaries, who have been receiving pension


Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


payments. The purchase of this group annuity contract will reduce the Company’s outstanding pension benefit obligation by approximately $800 million, representing approximately 20% of the total obligations of the Company’s qualified pension plans, and will be funded with pension plan assets. In connection with this transaction, the Company will record a one-time settlement charge in the fourth quarter of 2017 currently estimated at $365 million, reflecting the accelerated recognition of a portion of unamortized actuarial losses in the plan. The actual settlement charge could differ from this estimate due to changes in the Company’s actuarial assumptions. Additionally, during the fourth quarter of 2017, the Company expects to make a discretionary contribution of $500 million to prefund its qualified plans, which is expected to be partially funded by long-term borrowings.
Reconciliation of Non-GAAP Measures
Results for the three and nine months ended September 30, 2017March 31, 2023 and 20162022 included discretecertain items that were not part ofidentified as affecting comparability. Adjusted OIBDA, adjusted earnings from continuing operations before income taxes, adjusted provision for income taxes, adjusted net earnings from continuing operations attributable to Paramount, and adjusted diluted EPS from continuing operations (together, the normal course of operations. The following tables present non-GAAP financial measures, which“adjusted measures”) exclude the impact of these discrete items reconciled to the most directly comparable financialand are measures of performance not calculated in accordance with GAAP. The Company believes that presenting its financial results adjustedWe use these measures to, among other things, evaluate our operating performance. These measures are among the primary measures used by management for the impactplanning and forecasting of discrete items isfuture periods, and they are important indicators of our operational strength and business performance. In addition, we use Adjusted OIBDA to, among other things, value prospective acquisitions. We believe these measures are relevant and useful for investors because it allowsthey allow investors to view performance in a manner similar to the method used by the Company’s management and providesour management; provide a clearer perspective on our underlying performance; and make it easier for investors, analysts and peers to compare our operating performance to other companies in our industry and to compare our year-over-year results.

Because the underlyingadjusted measures are measures of performance not calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, operating income (loss), earnings (loss) from continuing operations before income taxes, (provision) benefit for income taxes, net earnings (loss) from continuing operations attributable to Paramount or diluted EPS from continuing operations, as applicable, as indicators of operating performance. These measures, as we calculate them, may not be comparable to similarly titled measures employed by other companies.

The following tables reconcile the Company.adjusted measures to their most directly comparable financial measures in accordance with GAAP.
 Three Months Ended September 30, 2017
 Reported Extinguishment of Debt 
Discrete Tax Item (a)
 
CBS Radio Adjustments (b)
 Adjusted 
Operating income$707
  $—
   $—
   $—
  $707
 
Interest expense(116)  —
   —
   —
  (116) 
Interest income17
  —
   —
   —
  17
 
Loss on early extinguishment of debt(5)  5
   —
   —
  —
 
Other items, net3
  —
   —
   —
  3
 
Earnings from continuing operations
before income taxes
606
  5
   —
   —
  611
 
Provision for income taxes(172)  (2)   —
   —
  (174) 
Equity in loss of investee companies,
net of tax
(16)  —
   —
   —
  (16) 
Net earnings from continuing operations418
  3
   —
   —
  421
 
Net earnings from discontinued
operations, net of tax
174
  —
   (45)   (100)  29
 
Net earnings$592
  $3
   $(45)   $(100)  $450
 
Diluted EPS from continuing operations$1.03
  $.01
   $—
   $—
  $1.04
 
Diluted EPS$1.46
  $.01
   $(.11)   $(.25)  $1.11
 
Three Months Ended
March 31,
20232022
Operating income (loss) (GAAP)$(1,226)$775 
Depreciation and amortization100 96 
Programming charges (a)
1,674 — 
Restructuring and other corporate matters (a)
— 57 
Gain on dispositions (a)
— (15)
Adjusted OIBDA (Non-GAAP)$548 $913 
(a) Reflects a tax benefit fromSee notes on the resolution of a tax matter in a foreign jurisdiction relating to a previously disposed business.
(b) Reflects a noncash gain associated with a valuation allowancefollowing tables for the carrying value of CBS Radio.additional information on items affecting comparability.

-30-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


 Three Months Ended September 30, 2016
 Reported 
Discrete Tax Items (a)
 Adjusted 
Earnings from continuing operations before income taxes$624
  $—
  $624
 
Provision for income taxes(145)  (47)  (192) 
Equity in loss of investee companies, net of tax(13)  —
  (13) 
Net earnings from continuing operations466
  (47)  419
 
Net earnings from discontinued operations, net of tax12
  36
  48
 
Net earnings$478
  $(11)  $467
 
Diluted EPS from continuing operations$1.04
  $(.11)  $.94
 
Diluted EPS$1.07
  $(.02)  $1.05
 
Three Months Ended March 31, 2023
Earnings (Loss) from Continuing Operations Before Income TaxesBenefit (Provision) for Income TaxesNet Earnings (Loss) from Continuing Operations Attributable to ParamountDiluted EPS from Continuing Operations
Reported (GAAP)$(1,463)$381 $(1,163)$(1.81)
Items affecting comparability:
Programming charges (a)
1,674 (409)1,265 1.94 
Discrete tax items (b)
— (30)(30)(.04)
Adjusted (Non-GAAP)$211 $(58)$72 $.09 
(a) Reflects a one-time tax benefitIn connection with our plan to integrate Showtime into Paramount+ and initiatives to rationalize and right-size our international operations to align with our streaming strategy and close or globalize certain of $47 million associated with a multiyear adjustment toour international channels, during the first quarter of 2023 we reviewed our content portfolio and determined that we would not use certain content on our platforms. Accordingly, we recorded programming charges, which were comprised of impairment charges for content removed from our platforms or abandoned, development cost write-offs and contract termination costs.
(b) Principally reflects a tax deduction, which was approved by the IRS during the third quarter of 2016, and a charge of $36 million in discontinued operationsbenefit from the resolution of aan income tax matter in a foreign jurisdiction relating to a previously disposed business.jurisdiction.
 Nine Months Ended September 30, 2017
 Reported Extinguishment of Debt 
Discrete Tax Items (a)
 
CBS Radio Adjustments (b)
  Adjusted 
Operating income$2,080
  $—
   $—
   $—
   $2,080
 
Interest expense(336)  —
   —
   —
   (336) 
Interest income45
  —
   —
   —
   45
 
Loss on early extinguishment of debt(5)  5
   —
   —
   —
 
Other items, net9
  —
   —
   —
   9
 
Earnings from continuing operations before income taxes1,793
  5
   —
   —
   1,798
 
Provision for income taxes(479)  (2)   (22)   —
   (503) 
Equity in loss of investee companies, net of tax(45)  —
   —
   —
   (45) 
Net earnings from continuing operations1,269
  3
   (22)   —
   1,250
 
Net earnings (loss) from discontinued
operations, net of tax
(871)  —
   (45)   984
   68
 
Net earnings$398
  $3
   $(67)   $984
   $1,318
 
Diluted EPS from continuing operations$3.10
  $.01
   $(.05)   $—
   $3.05
 
Diluted EPS$.97
  $.01
   $(.16)   $2.40
   $3.21
 
Three Months Ended March 31, 2022
Earnings from Continuing Operations Before Income TaxesProvision for Income TaxesNet Earnings from Continuing Operations Attributable to ParamountDiluted EPS from Continuing Operations
Reported (GAAP)$470 $(34)$391 $.58 
Items affecting comparability:
Restructuring and other corporate matters (a)
57 (12)45 .07 
Gain on dispositions (b)
(15)4 (11)(.02)
Loss on extinguishment of debt73 (17)56 .09 
Discrete tax items (c)
— (78)(78)(.12)
Adjusted (Non-GAAP)$585 $(137)$403 $.60 
(a) Reflects a tax benefitComprised of $22restructuring charges of $18 million from the resolution of certain state income tax mattersfor severance costs, and a tax benefitcharge of $45$39 million recorded following Russia’s invasion of Ukraine, principally to reserve against amounts due from counterparties in discontinued operations from the resolution of a tax matter in a foreign jurisdiction relating to a previously disposed business.Russia, Belarus and Ukraine.
(b) Reflects a noncash chargegain from the sale of $980 million associatedinternational intangible assets and a working capital adjustment to the gain from the fourth quarter 2021 sale of CBS Studio Center.
(c) Primarily reflects a deferred tax benefit resulting from the transfer of intangible assets between our subsidiaries in connection with a valuation allowance for the carrying valuereorganization of CBS Radio, and a restructuring charge of $7 million ($4 million, net of tax) at CBS Radio.our international operations.


-31-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


 Nine Months Ended September 30, 2016
 Reported 
Other Operating Items (a)
 
Discrete Tax Items (b)
 
Write-down of Investment (c)
 Adjusted 
Operating income$2,137
  $(9)  $—
  $—
  $2,128
 
Interest expense(304)  —
  —
  —
  (304) 
Interest income22
  —
  —
  —
  22
 
Other items, net(7)  —
  —
  —
  (7) 
Earnings from continuing operations before
income taxes
1,848
  (9)  —
  —
  1,839
 
Provision for income taxes(524)  4
  (47)  —
  (567) 
Equity in loss of investee companies, net of tax(43)  —
  —
  6
  (37) 
Net earnings from continuing operations1,281
  (5)  (47)  6
  1,235
 
Net earnings from discontinued operations,
net of tax
93
  —
  36
  —
  129
 
Net earnings$1,374
  $(5)  $(11)  $6
  $1,364
 
Diluted EPS from continuing operations$2.82
  $(.01)  $(.10)  $.01
  $2.71
 
Diluted EPS$3.02
  $(.01)  $(.02)  $.01
  $3.00
 
(a) Reflects a gain on the sale of an internet business in China and a multiyear, retroactive impact of a new operating tax.
(b) Reflects a one-time tax benefit of $47 million associated with a multiyear adjustment to a tax deduction, which was approved by the IRS during the third quarter of 2016, and a charge of $36 million in discontinued operations from the resolution of a tax matter in a foreign jurisdiction relating to a previously disposed business.
(c) Reflects the write-down of an international television joint venture to its fair value.

Consolidated Results of Operations
Three and Nine Months Ended September 30, 2017March 31, 2023versusThree and Nine Months Ended September 30, 2016March 31, 2022
Revenues
Three Months Ended March 31,
% of Total
Revenues		% of Total
Revenues		Increase/(Decrease)
Revenues by Type20232022$%
Advertising
$2,651 36 %$2,864 39 %$(213)(7)%
Affiliate and subscription3,179 44 2,840 39 339 12 
Theatrical127 2 131 2 (4)(3)
Licensing and other1,308 18 1,493 20 (185)(12)
Total Revenues$7,265 100 %$7,328 100 %$(63)(1)%
 Three Months Ended September 30, 
   
% of Total
Revenues
   
% of Total
Revenues
 Increase/(Decrease) 
Revenues by Type2017  2016  $ % 
Advertising$1,106
 35% $1,162
 38% $(56) (5)% 
Content licensing and distribution860
 27
 1,108
 36
 (248) (22) 
Affiliate and subscription fees1,145
 36
 753
 24
 392
 52
 
Other60
 2
 61
 2
 (1) (2) 
Total Revenues$3,171
 100% $3,084
 100% $87
 3 % 
Advertising
For the three months ended March 31, 2023, the 7% decrease in advertising revenues was driven by weakness in the global advertising market as well as the airing of fewer National Football League (“NFL”) games on CBS in the first quarter of 2023 compared with the same prior-year period.

Affiliate and Subscription
Affiliate and subscription revenues are principally comprised of fees received from multichannel video programming distributors (MVPDs) and third-party live television streaming services (virtual MVPDs or vMVPDs) for carriage of our cable networks (cable affiliate fees) and our owned television stations (retransmission fees), fees received from television stations for their affiliation with the CBS Television Network (“reverse compensation”), and subscription fees for our streaming services.

For the three months ended March 31, 2023, affiliate and subscription revenues increased 12%, driven by growth in subscribers for Paramount+ to 60.0 million at March 31, 2023 from 39.6 million at March 31, 2022. The increase in subscription revenue was partially offset by lower international affiliate fees for our linear networks, including an unfavorable impact from foreign exchange rate changes. Foreign exchange rate changes unfavorably impacted the total affiliate and subscription revenue comparison by 1 percentage point.

Theatrical
For the three months ended March 31, 2023, theatrical revenues decreased $4 million, reflecting the timing and mix of releases. Releases during the period included Scream VI, 80 for Brady, and Dungeons & Dragons: Honor Among Thieves while releases in the comparable prior-year period were Scream (2022), Jackass Forever, and The Lost City.

Licensing and Other
Licensing and other revenues are principally comprised of fees from the licensing of the rights to exhibit our internally-produced television and film programming on various platforms in the secondary market after its initial exhibition on our owned or third-party platforms; license fees from content produced or distributed for third parties; home entertainment revenues, which include the viewing of our content on a transactional basis through transactional video-on-demand (TVOD) and electronic sell-through services and the sale and distribution of our content through DVDs and Blu-ray discs to wholesale and retail partners; fees from the use of our trademarks and brands for consumer products, recreation and live events; and revenues from the rental of production facilities.
-32-
 Nine Months Ended September 30, 
   
% of Total
Revenues
   
% of Total
Revenues
 Increase/(Decrease) 
Revenues by Type2017  2016  $ % 
Advertising$4,008
 41% $4,492
 46% $(484) (11)% 
Content licensing and distribution2,761
 28
 2,780
 29
 (19) (1) 
Affiliate and subscription fees2,835
 29
 2,208
 23
 627
 28
 
Other167
 2
 168
 2
 (1) (1) 
Total Revenues$9,771
 100% $9,648
 100% $123
 1 % 




Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


The 12% decrease in licensing and other revenues for the three months ended March 31, 2023 reflects a lower volume of licensing in the secondary market.
Advertising
Operating Expenses
Three Months Ended March 31,
% of Operating Expenses% of Operating ExpensesIncrease/(Decrease)
Operating Expenses by Type20232022$%
Content costs$3,895 78 %$3,831 80 %$64 2 %
Distribution and other1,069 22 965 20 104 11 
Total Operating Expenses$4,964 100 %$4,796 100 %$168 4 %
Content Costs
Content costs include the amortization of costs of internally-produced television and theatrical film content; amortization of acquired program rights; other television production costs, including on-air talent; and participation and residuals expenses, which reflect amounts owed to talent and other participants in our content pursuant to contractual and collective bargaining arrangements.

For the three months ended September 30, 2017, the 5% decreaseMarch 31, 2023, content costs increased 2% as a result of our investment in advertising revenues primarily reflects lower political advertising sales and lower ratings,content for our streaming services, which was partially offset by higher pricing. The comparison was also impacted by one less Thursday Night Football game broadcast onlower costs associated with the decrease in licensing revenue and lower sports programming costs.

Distribution and Other
Distribution and other operating expenses primarily include costs relating to the distribution of our content, including print and advertising for theatrical releases and costs for third-party distribution; compensation; revenue-sharing costs to television stations affiliated with the CBS Television Network in the third quarter of 2017. For the nine months ended September 30, 2017, the 11% decrease in advertising revenues primarily reflects the benefit to 2016 from the broadcast of Super Bowl 50 as well as lower political advertising sales.Network; and other ancillary and overhead costs associated with our operations.


During the fourth quarter of 2017, the advertising revenue comparison with the prior year will continue to be negatively affected by the benefit in 2016 from strong political advertising. Additionally, the CBS Television Network’s upfront advertising sales for the 2017/2018 television broadcast season, which runs from the middle of September 2017 through the middle of September 2018, concluded with increases in pricing compared with the prior broadcast season, and a majority of the Company’s deals are based on a live-plus-seven day viewing window, which are expected to benefit advertising revenues during the 2017/2018 broadcast season. However, overall advertising revenues for the Company will be dependent on ratings for its programming and market conditions, including demand in the scatter advertising market, which is when advertisers purchase the remaining advertising spots closer to the broadcast of the related programming. During the first nine months of 2017, compared to the same period in 2016, the Company has experienced lower ratings, which was largely offset by higher pricing.

Content Licensing and Distribution
For the three months ended September 30, 2017,March 31, 2023, distribution and other expenses increased 11% primarily reflecting higher costs associated with the 22% decreasegrowth of our streaming services, including costs for third-party distribution, revenue sharing, technology and compensation. The increase also reflects higher costs to support theatrical releases.

Programming Charges
During the first quarter of 2023, in connection with our plan to integrate Showtime into Paramount+ across both streaming and linear platforms, we performed a comprehensive strategic review of the combined content licensingportfolio of Showtime and distribution revenues primarily reflectsParamount+. We also reviewed our international content portfolio in connection with initiatives to rationalize and right-size our international operations to align with our streaming strategy, and close or globalize certain of our international channels. Following these reviews, we determined that we would not use certain content on our platforms, which resulted in the timingremoval or abandonment of domestic television licensing salescontent, the write-off of development costs, and the benefit intermination of programming agreements during the third quarterquarter. Accordingly, we recorded charges totaling $1.67 billion on the Consolidated Statement of 2016 from the licensing of Penny Dreadful and various titles from the Company’s television library. These decreases were partially offset by growth in international licensing. For the nine months ended September 30, 2017, the 1% decrease in content licensing and distribution revenues primarily reflects the timing of domestic television licensing and the benefit to 2016 from the international licensing sales of five Star Trek library series, partially offset by strong demand for the Company’s content internationally, reflecting additional titles available for sale as a result of the Company’s recent increased investment in internally-produced series.

For the remainder of 2017, the content licensing and distribution revenues comparison will be impacted by fluctuations resulting from the timing of when Company-owned television series are made available for multiyear licensing agreements. Television license fee revenues are recognized at the beginning of the license period in which programs are made available to the licensee for exhibition.

Affiliate and Subscription Fees
For the three and nine months ended September 30, 2017, the increases in affiliate and subscription fees of 52% and 28%, respectively, primarily reflect revenues from Showtime Networks’ distribution of the Floyd Mayweather/Conor McGregor pay-per-view boxing event, which contributed 36 points and 12 points of the growthOperations for the three and nine-month periods, respectively. Underlying affiliate and subscription fee revenues for each of the three and nine months ended September 30, 2017 increased 16%, led by growth in station affiliation fees and retransmissionMarch 31, 2023. The charges are comprised of $1.45 billion for the impairment of content to its estimated fair value, which included assumptions for estimated secondary market licensing revenues, and higher revenues from new digital initiatives, including the Company’s owned streaming subscription services, CBS All Access and the Showtime digital streaming subscription offering, and third-party live television streaming offerings.

Over the next few years, the Company expects to benefit from the renewal of several of its agreements with station affiliates and MVPDsif any, as well as from agreements with new distributors of live television streaming offerings. In addition, the Company’s existing agreements with station affiliates and MVPDs include annual contractual$225 million for development

-33-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


increases. Together, these factors are expected to result in continued growth in affiliatecost write-offs and subscription fees over the next several years.

International Revenues
The Company generated approximately 12% and 11% of its total revenues from international regionscontract termination costs. As we prepare for the three months ended September 30, 2017 and 2016, respectively, and generated approximately 14%launch of its total revenues from international regions for each of the nine months ended September 30, 2017 and 2016.

Operating Expenses
 Three Months Ended September 30, 
   % of Operating Expenses   % of Operating Expenses Increase/(Decrease) 
Operating Expenses by Type2017  2016  $ % 
Programming$749
 40% $500
 28% $249
 50 % 
Production572
 31
 666
 37
 (94) (14) 
Participation, distribution and royalty199
 11
 291
 16
 (92) (32) 
Other342
 18
 331
 19
 11
 3
 
Total Operating Expenses$1,862
 100% $1,788
 100% $74
 4 % 
 Nine Months Ended September 30, 
   % of Operating Expenses   % of Operating Expenses Increase/(Decrease) 
Operating Expenses by Type2017  2016  $ % 
Programming$2,258
 38% $2,133
 37% $125
 6 % 
Production1,955
 33
 1,933
 33
 22
 1
 
Participation, distribution and royalty725
 12
 788
 13
 (63) (8) 
Other1,002
 17
 964
 17
 38
 4
 
Total Operating Expenses$5,940
 100% $5,818
 100% $122
 2 % 

Programming
For the three and nine months ended September 30, 2017, the increases in programming expenses of 50% and 6%, respectively, were driven by costs associatedParamount+ with Showtime Networks’ distribution of the Floyd Mayweather/Conor McGregor pay-per-view boxing event,later this year, we will continue to evaluate our content portfolio, and for the nine months ended September 30, 2017, the increase also reflects costs in 2017 associated with CBS’s broadcast of the semifinals and finals of the NCAA Division I Men’s Basketball Championship. The increases for the nine-month period were partially offset by costs in the first quarter of 2016 associated with the broadcast of Super Bowl 50.may incur additional programming charges.

Production
For the three months ended September 30, 2017, the 14% decrease in production expenses primarily reflects lower costs associated with the decrease in television licensing revenues. For the nine months ended September 30, 2017, the 1% increase in production expenses mainly reflects an increased investment in internally-produced television series and higher costs associated with the mix of titles sold under television licensing arrangements. These increases were partially offset by production costs in the first quarter of 2016 associated with CBS’s broadcast of Super Bowl 50.


Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Participation, distribution and royalty
For the three and nine months ended September 30, 2017, the decreases in participation, distribution and royalty costs of 32% and 8%, respectively, were driven by lower television licensing revenues and the mix of titles sold under licensing arrangements.


Selling, General and Administrative Expenses
Three Months Ended March 31,
20232022Increase/(Decrease)
Selling, general and administrative
   expenses		$1,753 $1,619 8 %
 Three Months Ended September 30,
 2017 % of Revenues 2016 % of Revenues Increase/(Decrease) 
Selling, general and administrative expenses$547
  17%  $521
  17%   5%  
 Nine Months Ended September 30,
 2017 % of Revenues 2016 % of Revenues Increase/(Decrease) 
Selling, general and administrative expenses$1,585
  16%  $1,534
  16%   3%  

Selling, general and administrative (“SG&A”) expenses include expensescosts incurred for selling andadvertising, marketing, costs, occupancy, professional service fees, and back office support.support, including employee compensation and technology. For the three and nine months endedSeptember 30, 2017, the increases in March 31, 2023, SG&A expenses of 5%increased 8% driven by advertising, employee costs and 3%, respectively, primarily reflect higher advertising and marketing costs, mainlyother cost increases to support the Company’s growth initiatives.and expansion of our streaming services.


Depreciation and Amortization
Three Months Ended March 31,
20232022Increase/(Decrease)
Depreciation and amortization$100 $96 4 %
 Three Months Ended September 30, Nine Months Ended September 30, 
 2017
2016 Increase/(Decrease) 2017
2016 Increase/(Decrease) 
Depreciation and amortization$55
 $54
  2%  $166
 $168
  (1)%  
Restructuring and Other Corporate Matters

During the three months ended March 31, 2022, we recorded restructuring charges of $18 million for severance costs primarily associated with management changes following our operating segment realignment, and a charge of $39 million following Russia’s invasion of Ukraine, principally to reserve against amounts due from counterparties in Russia, Belarus and Ukraine.
Other Operating Items, Net
Gain on Dispositions
For the ninethree months ended September 30, 2016, other operating items, net includedMarch 31, 2022, gain on dispositions of $15 million was comprised of a gain
from the sale of an internet business in Chinainternational intangible assets and a multiyear, retroactive impactworking capital adjustment to the gain from the fourth quarter
2021 sale of a new operating tax.CBS Studio Center.


Interest Expense/Income
 Three Months Ended September 30, Nine Months Ended September 30, 
 2017
2016
Increase/(Decrease) 2017
2016 Increase/(Decrease) 
Interest expense$(116) $(104)  12%  $(336) $(304)  11%  
Interest income$17
 $7
  143%  $45
 $22
  105%  
The following table presents the Company’s outstanding debt balances, excluding capital leases, and the weighted average interest rate as of September 30, 2017 and 2016:
Three Months Ended March 31,
20232022Increase/(Decrease)
Interest expense$226 $240 (6)%
Interest income$35 $21 67 %
-34-
 At September 30,
   Weighted Average   Weighted Average 
 2017 Interest Rate 2016 Interest Rate 
Total long-term debt$9,039
  4.43%  $8,849
  4.47%  
Commercial paper$590
  1.44%  $33
  0.75%  




Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


The following table presents our outstanding debt balances, excluding finance leases, and the weighted average interest rates as of March 31, 2023 and 2022.
At March 31,
Weighted AverageWeighted Average
2023Interest Rate2022Interest Rate
Total notes and debentures$15,787 5.13 %$16,727 5.09 %
Other bank borrowings$58 7.48 %$65 3.50 %
Loss on Early Extinguishment of Debt
For the three and nine months ended September 30, 2017, theMarch 31, 2022, we recorded a loss on early extinguishment of debt of $5$73 million
reflected a pre-tax loss associated with the early redemption of the Company’s $300 million outstanding 4.625% senior notes due May 2018.long-term debt of $1.94 billion.


Other Items, Net
 Three Months Ended September 30, Nine Months Ended September 30, 
 2017
2016 Increase/(Decrease) 2017 2016 Increase/(Decrease) 
Other items, net$3
 $—
  n/m  $9
 $(7)  n/m  
n/m - not meaningful
The following table presents the components of Other items, net for all periods primarily consists of foreign exchange gains and losses.net.
Three Months Ended March 31,
20232022
Pension and postretirement benefit costs$(37)$(17)
Foreign exchange loss(9)1 
Other— 3 
Other items, net$(46)$(13)
Provision (Benefit) for Income Taxes
The provision (benefit) for income taxes represents federal, state and local, and foreign taxes on earnings (loss) from continuing operations before income taxes and equity in loss of investee companies.
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 Increase/(Decrease) 2017 2016 Increase/(Decrease)
Provision for income taxes, including
interest and before other discrete items

$(187) $(207)  (10)%  $(548) $(581)  (6)% 
Excess tax benefits from stock-based
compensation (a)
10
 —
     41
 —
    
Other discrete items (b)
5
 62
     28
 57
    
Provision for income taxes$(172) $(145)  19 %  $(479) $(524)  (9)% 
Effective income tax rate28.4% 23.2%     26.7% 28.4%    
(a) Reflects excess For the three months endedMarch 31, 2023, we recorded a benefit for income taxes of $381 million, reflecting an effective income tax benefits associated with the exerciserate of stock options and vesting of RSUs. During26.0%. The income tax benefit in the first quarter of 2017,2023 is the Company adopted FASB guidance which requires that the difference between theresult of a tax benefit from stock-based compensation expenseof $409 million on programming charges of $1.67 billion recorded during the period and the deduction on thea net discrete tax return be recognized within the income tax provision on the statementbenefit of operations. Previously, such difference was recognized in stockholders’ equity on the balance sheet. This difference occurs because stock-based compensation expense is recorded based on the grant-date fair value of the award, whereas the tax deduction is based on the fair value on the date the stock option is exercised or the RSU vests. This guidance requires the income statement classification to be applied prospectively, and therefore, excess tax benefits for prior periods remain classified in stockholders’ equity.
(b) For the nine months ended September 30, 2017, primarily reflects tax benefits$30 million, principally from the resolution of certain statean income tax matters. matter in a foreign jurisdiction. Together these items reduced our effective income tax rate by 1.5 percentage points.

For the three and nine months ended September 30, 2016, primarily reflectsMarch 31, 2022, we recorded a one-timeprovision for income taxes of $34 million, reflecting an effective income tax rate of 7.2%. Included in the provision for income taxes for the three months ended March 31, 2022 is a net discrete tax benefit of $47$78 million associatedprimarily resulting from the transfer of intangible assets between our subsidiaries in connection with a multiyear adjustment toreorganization of our international operations. This item, together with a net tax deduction, which was approved bybenefit of $25 million on other items identified as affecting the IRScomparability of our results during the third quarterperiod (which include a loss on extinguishment of 2016.debt, restructuring and other corporate matters, and a gain on dispositions) reduced our effective income tax rate by 16.2 percentage points.

Equity in Loss of Investee Companies, Net of Tax
-35-
 Three Months Ended September 30, Nine Months Ended September 30, 
 2017
2016
Increase/(Decrease) 2017 2016 Increase/(Decrease) 
Equity in loss of investee companies,
net of tax
$(16) $(13)  23%  $(45) $(43)  5%  





Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Equity in Loss of Investee Companies, Net of Tax
The following table presents equity in loss of investee companies for our equity-method investments.
Three Months Ended March 31,
20232022Increase/(Decrease)
Equity in loss of investee companies$(78)$(52)(50)%
Tax benefit3 15 (80)
Equity in loss of investee companies, net of tax$(75)$(37)(103)%
For the three months ended March 31, 2023, the higher loss for our equity-method investments was driven by our investment in SkyShowtime.

Net Earnings (Loss) from Continuing Operations Attributable to Paramount and Diluted EPS from Continuing Operations
Three Months Ended March 31,
20232022Increase/(Decrease)
Net earnings (loss) from continuing operations
   attributable to Paramount		$(1,163)$391 n/m
Diluted EPS from continuing operations$(1.81)$.58 n/m
 Three Months Ended September 30, Nine Months Ended September 30, 
 2017 2016 Increase/(Decrease) 2017 2016 Increase/(Decrease) 
Net earnings from continuing operations$418
 $466
  (10)%  $1,269
 $1,281
  (1)%  
Diluted EPS from continuing operations$1.03
 $1.04
  (1)%  $3.10
 $2.82
  10 %  
n/m-not meaningful
For the three months ended September 30, 2017, the decreases inMarch 31, 2023, we reported a net loss from continuing operations attributable to Paramount of $1.16 billion, or $1.81 per diluted share compared with net earnings from continuing operations andattributable to Paramount of $391 million, or $.58 per diluted EPS from continuing operations of 10% and 1%, respectively, were primarilyshare. The decrease was driven by the result of lowerdecline in operating income, andincluding the impact offrom the previously mentioned tax benefit of $47 million in the third quarter of 2016. Diluted EPS from continuing operations benefited from lower weighted average shares outstanding as a result of the Company’s ongoing share repurchase program, which partially offset the lower earnings. For the nine months ended September 30, 2017, the 1% decrease in net earnings from continuing operations primarily reflects lower operating income. The 10% increase in diluted EPS from continuing operations for the nine-month period reflects lower weighted average shares outstanding as a result of the Company’s ongoing share repurchase program, which more than offset the lower earnings.

programming charges discussed above.
Net Earnings (Loss) from Discontinued Operations
The following table sets forth details of net earnings (loss) from discontinued operations for the three and nine months ended September 30, 2017 and 2016. Net earnings (loss) from discontinued operations included the operating results of CBS Radio for all periods presented. Net earnings (loss) from discontinued operations also included a tax benefit of $45 million for the three and nine months ended September 30, 2017 and a charge of $36 million for the three and nine months ended September 30, 2016, in each case from the resolution of a tax matter in a foreign jurisdiction relating to a previously disposed business that was accounted for as a discontinued operation.
.
Three Months Ended September 30, 2017CBS Radio Other Total
Revenues$300
 $—
 $300
Costs and expenses: (a)


 

 

Operating113
 —
 113
Selling, general and administrative121
 (1) 120
Benefit from valuation allowance(100) —
 (100)
Total costs and expenses134
 (1) 133
Operating income166
 1
 167
Interest expense(21) —
 (21)
Earnings from discontinued operations145
 1
 146
Income tax (provision) benefit(17) 45
 28
Net earnings from discontinued operations, net of tax$128
 $46
 $174
(a) CBS Radio has been classified as held for sale beginning inIn the fourth quarter of 2016. Under ASC 360, assets held2020, we entered into an agreement to sell our publishing business, Simon & Schuster, which was previously reported as the Publishing segment and as a result, we began presenting Simon & Schuster as a discontinued operation. In the fourth quarter of 2022, we terminated the agreement after the U.S. Department of Justice prevailed in its suit to block the sale. Simon & Schuster remains a noncore asset as it does not fit strategically within our video-based portfolio. We expect to enter into a new agreement to sell Simon & Schuster in 2023. Assuming that we do so, closing would be subject to closing conditions that would include regulatory approval. Simon & Schuster continues to be presented as a discontinued operation for sale are not depreciated or amortized.all periods presented.


-36-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


The following table sets forth details of net earnings from discontinued operations for the three months ended March 31, 2023 and 2022, which primarily reflects the results of Simon & Schuster.
Three Months Ended September 30, 2016CBS Radio Other Total
Revenues$317
 $—
 $317
Costs and expenses:

 

 

Operating110
 —
 110
Selling, general and administrative123
 —
 123
Depreciation and amortization7
 —
 7
Total costs and expenses240
 —
 240
Operating income77
 —
 77
Other income2
 —
 2
Earnings from discontinued operations79
 —
 79
Income tax provision(31) (36) (67)
Net earnings (loss) from discontinued operations, net of tax$48
 $(36) $12
Nine Months Ended September 30, 2017CBS Radio Other Total
Revenues$856
 $—
 $856
Costs and expenses: (a)


 

 

Operating307
 —
 307
Selling, general and administrative372
 (1) 371
Restructuring charge7
 —
 7
Provision for valuation allowance980
 —
 980
Total costs and expenses1,666
 (1) 1,665
Operating income (loss)(810) 1
 (809)
Interest expense(60) —
 (60)
Earnings (loss) from discontinued operations(870) 1
 (869)
Income tax (provision) benefit(47) 45
 (2)
Net earnings (loss) from discontinued operations, net of tax$(917) $46
 $(871)
Three Months Ended
March 31,
20232022
Revenues$258 $217 
Costs and expenses:
Operating151 124 
Selling, general and administrative45 38 
Total costs and expenses (a)
196 162 
Operating income62 55 
Other items, net(3)(1)
Earnings from discontinued operations59 54 
Provision for income taxes (b)
(14)(12)
Net earnings from discontinued operations, net of tax$45 $42 
(a) CBS Radio has been classified as heldIncluded in total costs and expenses are amounts associated with the release of indemnification obligations for sale beginning in the fourth quarterleases relating to a previously disposed business of 2016. Under ASC 360, assets held for sale are not depreciated or amortized.
Nine Months Ended September 30, 2016CBS Radio Other Total
Revenues$892
 $—
 $892
Costs and expenses:

 

 

Operating298
 —
 298
Selling, general and administrative359
 —
 359
Depreciation and amortization20
 —
 20
Total costs and expenses677
 —
 677
Operating income215
 —
 215
Other income2
 —
 2
Earnings from discontinued operations217
 —
 217
Income tax provision(88) (36) (124)
Net earnings (loss) from discontinued operations, net of tax$129
 $(36) $93

FASB Accounting Standards Codification (“ASC”) 360 requires that an asset classified as held for sale be measured each reporting period at the lower of its carrying amount or fair value less cost to sell. The ultimate value of the transaction with Entercom will be determined based on Entercom’s stock price at the closing of the transaction. The Company recorded a noncash gain of $100$4 million and $5 million for the three months ended September 30, 2017March 31, 2023 and a noncash charge2022, respectively.
(b) The tax provision includes amounts relating to previously disposed businesses of $980$1 million for each of the ninethree months ended September 30, 2017 associatedMarch 31, 2023 and 2022.
Segment Results of Operations
We present operating income excluding depreciation and amortization, stock-based compensation, costs for restructuring and other corporate matters, programming charges and gain on dispositions, each where applicable (“Adjusted OIBDA”), as the primary measure of profit and loss for our operating segments in accordance with Financial Accounting Standards Board guidance for segment reporting since it is the primary method used by our management. Stock-based compensation is excluded from our segment measure of profit and loss because it is set and approved by our Board of Directors in consultation with corporate executive management. Stock-based compensation is included as a valuation allowancecomponent of our consolidated Adjusted OIBDA. See Reconciliation of Non-GAAP Measures for a reconciliation of total Adjusted OIBDA to adjustOperating Income (Loss), the carrying value of CBS Radio to the value indicated by the stock valuation of Entercom. Themost directly comparable financial measure in accordance with GAAP.
Three Months Ended March 31, 2023 and 2022
Three Months Ended March 31,
% of Total
Revenues		% of Total
Revenues		Increase/(Decrease)
20232022$%
Revenues:
TV Media$5,193 71 %$5,645 77 %$(452)(8)%
Direct-to-Consumer1,510 21 1,089 15 421 39 
Filmed Entertainment588 8 624 8 (36)(6)
Eliminations(26)— (30)— 4 13 
Total Revenues$7,265 100 %$7,328 100 %$(63)(1)%

-37-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Three Months Ended March 31,
Increase/(Decrease)
20232022$%
Adjusted OIBDA:
TV Media$1,306 $1,544 $(238)(15)%
Direct-to-Consumer(511)(456)(55)(12)
Filmed Entertainment(99)(37)(62)(168)
Corporate/Eliminations(109)(104)(5)(5)
Stock-based compensation (a)
(39)(34)(5)(15)
Total Adjusted OIBDA548 913 (365)(40)
Depreciation and amortization(100)(96)(4)(4)
Programming charges(1,674)— (1,674)n/m
Restructuring and other corporate matters— (57)57 n/m
Gain on dispositions— 15 (15)n/m
Total Operating Income (Loss)$(1,226)$775 $(2,001)n/m
Company will record an additional gain or loss upon the closing of the transaction, which is expected to occur in the fourth quarter of 2017. A 10% change to Entercom’s stock price would change the carrying value of CBS Radio by approximately $110 million.n/m - not meaningful

(a) For the ninethree months ended September 30, 2017, CBS Radio recorded a restructuring chargeMarch 31, 2022, stock-based compensation expense of $7$2 million associated with the reorganization of certain business operations, reflecting severance costs and costs associated with exiting contractual obligations.

Net Earnings and Diluted EPS
 Three Months Ended September 30, Nine Months Ended September 30, 
 2017
2016
Increase/(Decrease) 2017 2016 Increase/(Decrease) 
Net earnings$592
 $478
  24%  $398
 $1,374
  (71)%  
Diluted EPS$1.46
 $1.07
  36%  $.97
 $3.02
  (68)%  
Segment Results of Operations
The Company presents operating income (loss) excluding restructuring chargesis included in “Restructuring and other operating items, net, each where applicable, (“Segment Operating Income”) as the primary measure of profit and loss for its operating segments in accordance with FASB guidance for segment reporting. The Company believes the presentation of Segment Operating Income is relevant and useful for investors because it allows investors to view segment performance in a manner similar to the primary method used by the Company’s management and enhances their ability to understand the Company’s operating performance. The reconciliation of Segment Operating Income to the Company’s consolidated Net earnings (loss) is presented in Note 13 (Reportable Segments) to the consolidated financial statements.corporate matters”.
TV Media
Three Months Ended September 30, 2017March 31, 2023 and 20162022
Three Months Ended March 31,
Increase/(Decrease)
TV Media20232022$%
Advertising
$2,256 $2,521 $(265)(11)%
Affiliate and subscription2,067 2,098 (31)(1)
Licensing and other870 1,026 (156)(15)
Revenues$5,193 $5,645 $(452)(8)%
Adjusted OIBDA$1,306 $1,544 $(238)(15)%

Revenues
For the three months ended March 31, 2023, revenues decreased 8%, primarily reflecting lower advertising and licensing revenues.

Advertising
The 11% decrease in advertising revenues was primarily the result of lower impressions for our domestic networks, which were only partially offset by higher pricing, and lower revenues for our international networks, as our advertising revenues were impacted globally by weakness in the advertising market. The decline in advertising revenues also reflects the airing of fewer NFL games on CBS in the first quarter of 2023 compared with the same prior-year period, and an adverse effect from foreign exchange rate changes of 2 percentage points.

Affiliate and Subscription
The 1% decrease in affiliate and subscription revenues mainly reflects lower international affiliate revenues, driven by unfavorable foreign exchange rate changes and a shift of revenue from our pay television services to our streaming services following the restructuring of certain affiliate agreements. Domestic affiliate revenues were
-38-
 Three Months Ended September 30,
  
% of Total
Revenues
  
% of Total
Revenues
Increase/(Decrease) 
 2017
2016$ % 
Revenues:             
Entertainment$1,815
 57 %  $1,949
 63 % $(134) (7)% 
Cable Networks840
 26
  598
 20
 242
 40
 
Publishing228
 7
  226
 7
 2
 1
 
Local Media397
 13
  409
 13
 (12) (3) 
Corporate/Eliminations(109) (3)  (98) (3) (11) (11) 
Total Revenues$3,171
 100 %  $3,084
 100 % $87
 3 % 

 Three Months Ended September 30,
  
% of Total
Operating
Income
  
% of Total
Operating
Income
  
    Increase/(Decrease) 
 2017 2016$ % 
Segment Operating Income (Loss):             
Entertainment$345
 49 %  $348
 48 % $(3) (1)% 
Cable Networks294
 42
  285
 40
 9
 3
 
Publishing46
 6
  44
 6
 2
 5
 
Local Media105
 15
  122
 17
 (17) (14) 
Corporate(83) (12)  (78) (11) (5) (6) 
Total Operating Income$707
 100 %  $721
 100 % $(14) (2)% 



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


essentially flat compared with the prior-year period as the impact from lower domestic subscribers was substantially offset by growth in reverse compensation and contractual rate increases.

Licensing and Other
Licensing and other revenues decreased 15%, reflecting a lower volume of licensing in the secondary market and lower revenues from content produced for third parties.

Adjusted OIBDA
Adjusted OIBDA decreased15%, primarily driven by the decline in revenues, partially offset by lower content costs associated with the decrease in content licensing revenues and lower sports programming costs.
Direct-to-Consumer
 Three Months Ended September 30,
   Increase/(Decrease) 
 2017 2016 $ % 
Depreciation and Amortization:        
Entertainment$29
 $28
 $1
 4 % 
Cable Networks5
 6
 (1) (17) 
Publishing2
 1
 1
 100
 
Local Media11
 11
 —
 —
 
Corporate8
 8
 —
 —
 
Total Depreciation and Amortization$55
 $54
 $1
 2 % 
NineThree Months Ended March 31, 2023 and 2022
Three Months Ended March 31,
Direct-to-Consumer20232022Increase/(Decrease)
Advertising$398 $347 $51 15 %
Subscription1,112 742 370 50 
Revenues$1,510 $1,089 $421 39 %
Adjusted OIBDA$(511)$(456)$(55)(12)%
Three Months Ended March 31,
(in millions)20232022Increase/(Decrease)
Paramount+ (Global)
Subscribers (a)
60.0 39.6 20.4 52 %
Revenues$965 $585 $380 65 %
(a) Subscribers include customers with access to Paramount+, either directly through our owned and operated apps and websites, or through third-party distributors. Our subscribers include paid subscriptions and those customers registered in a free trial. For the periods above, subscriber counts reflect the number of subscribers as of the applicable period-end date.
Revenues
For the three months ended March 31, 2023, the 39% increase in revenue was primarily driven by growth from Paramount+.

Advertising
The 15% increase in advertising revenues was driven by an increase in impressions, reflecting the benefit from growth in Paramount+ subscribers.

Subscription
The 50% increase in subscription revenues reflects growth across our streaming services, primarily from Paramount+. Paramount+ subscribers grew 20.4 million, or 52%, compared to March 31, 2022, driven by the benefit from 2022 launches in international markets as well as growth in U.S. subscribers. Subscriber growth was impacted by the removal of 1.9 million Paramount+ subscribers following the September 30, 20172022 launch of the SkyShowtime streaming service in the Nordics, where it replaced Paramount+ in the market, and 2016the removal in
-39-
 Nine Months Ended September 30, 
  
% of Total
Revenues
  
% of Total
Revenues
Increase/(Decrease) 
 2017 2016$ % 
Revenues:             
Entertainment$6,346
 65 %  $6,483
 67 % $(137) (2)% 
Cable Networks1,954
 20
  1,659
 17
 295
 18
 
Publishing595
 6
  558
 6
 37
 7
 
Local Media1,218
 13
  1,253
 13
 (35) (3) 
Corporate/Eliminations(342) (4)  (305) (3) (37) (12) 
Total Revenues$9,771
 100 %  $9,648
 100 % $123
 1 % 

 Nine Months Ended September 30, 
  
% of Total
Segment
Operating
Income
  
% of Total
Segment
Operating
Income
  
    Increase/(Decrease) 
 2017 2016$ % 
Segment Operating Income (Loss):             
Entertainment$1,089
 53 %  $1,148
 54 % $(59) (5)% 
Cable Networks795
 38
  740
 35
 55
 7
 
Publishing88
 4
  83
 4
 5
 6
 
Local Media355
 17
  402
 19
 (47) (12) 
Corporate(247) (12)  (245) (12) (2) (1) 
Total Segment Operating Income2,080
 100 %  2,128
 100 % (48) (2) 
Other operating items, net—
    9
   (9) n/m
 
Total Operating Income$2,080
    $2,137
   $(57) (3)% 
n/m - not meaningful
 Nine Months Ended September 30,
   Increase/(Decrease) 
 2017 2016 $ % 
Depreciation and Amortization:        
Entertainment$85
 $88
 $(3) (3)% 
Cable Networks17
 17
 —
 —
 
Publishing5
 4
 1
 25
 
Local Media34
 33
 1
 3
 
Corporate25
 26
 (1) (4) 
Total Depreciation and Amortization$166
 $168
 $(2) (1)% 



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


April 2022 of 1.2 million Paramount+ subscribers in Russia, where we suspended our operations following Russia’s invasion of Ukraine.
Entertainment (CBS Television Network, CBS Television Studios, CBS Studios International, CBS Television Distribution, CBS Interactive
During the quarter, global Paramount+ subscribers increased 4.1 million, or 7%, to 60.0 million, compared with 55.9 million at December 31, 2022, reflecting the continued success of our content, including 1923, Tulsa King, Top Gun: Maverick and Teen Wolf: The Movie as well as the NFL Playoffs.

Adjusted OIBDA
Adjusted OIBDA decreased $55 million, as revenue growth was more than offset by higher costs to support growth in our streaming services including content, advertising, distribution, employee and CBS Films)technology costs.
Filmed Entertainment
Three Months Ended September 30, 2017March 31, 2023 and 20162022
Three Months Ended March 31,
Increase/(Decrease)
Filmed Entertainment20232022$%
Advertising (a)
$5 $2 $3 150 %
Theatrical127 131 (4)(3)
Licensing and other456 491 (35)(7)
Revenues$588 $624 $(36)(6)%
Adjusted OIBDA$(99)$(37)$(62)(168)%
 Three Months Ended September 30,
   Increase/(Decrease) 
Entertainment2017
2016 $ % 
Revenues$1,815
 $1,949
 $(134) (7)% 
Segment Operating Income$345
 $348
 $(3) (1)% 
Segment Operating Income as a % of revenues19% 18%     
Depreciation and amortization$29
 $28
 $1
 4 % 
Capital expenditures$25
 $23
 $2
 9 % 
(a) Primarily reflects advertising revenues earned from the use of Filmed Entertainment content on third party digital platforms.
Revenues
For the three months ended September 30, 2017, the 7%March 31, 2023, revenues decreased 6%, driven by lower licensing revenues.

Theatrical
The $4 million decrease in theatrical revenues wasreflects the timing and mix of releases. Releases during the first quarter of 2023 included Scream VI, 80 for Brady, and Dungeons & Dragons: Honor Among Thieves while releases in the comparable prior-year period were Scream (2022), Jackass Forever, and The Lost City.

Licensing and Other
The 7% decrease in licensing and other revenues primarily reflects lower consumer products licensing revenues as a result of macroeconomic softness.

Adjusted OIBDA
Adjusted OIBDA decreased $62 million in the quarter, driven by a 26%an adverse impact from the timing of the release of Dungeons and Dragons: Honor Among Thieves on the last day of the quarter, costs from the release of Miramax’s Operation Fortune: Ruse de Guerre,and the decline in contentconsumer products licensing and distribution revenues, mainlyrevenues.

Fluctuations in results for the Filmed Entertainment segment may occur as a result of the timing of domestic television licensing salesthe recognition of distribution costs, including print and the benefit to 2016 from sales of various titles from the Company’s television library,advertising, which were partially offset by growth in international licensing sales. Advertising revenues decreased 3% forare generally incurred before and throughout the three months ended September 30, 2017, reflecting lower ratings, partially offset by higher pricing. The advertising comparison was also impacted by one less Thursday Night Football game broadcast on the CBS Television Network in the third quarter of 2017. These decreases were partially offset by 35% growth in affiliate and subscription fees, reflecting higher station affiliation fees and growth from new digital initiatives, including CBS All Access and third-party live television streaming services.

For the three months ended September 30, 2017, operating income decreased 1%, while the operating income margin expanded one percentage point reflecting a mix of higher-margin revenues in 2017.

Nine Months Ended September 30, 2017 and 2016
-40-
 Nine Months Ended September 30,
   Increase/(Decrease) 
Entertainment2017 2016 $ % 
Revenues$6,346
 $6,483
 $(137) (2)% 
Segment Operating Income$1,089
 $1,148
 $(59) (5)% 
Segment Operating Income as a % of revenues17% 18%     
Depreciation and amortization$85
 $88
 $(3) (3)% 
Capital expenditures$63
 $60
 $3
 5 % 

For the nine months ended September 30, 2017, the 2% decrease in revenues mainly reflects the benefit in 2016 from the broadcast of Super Bowl 50, which was partially offset by a 34% increase in affiliate and subscription fees, reflecting higher station affiliation fees and growth from new digital initiatives, including CBS All Access and third-party live television streaming services. Content licensing and distribution revenues were comparable with the prior-year period, as strong demand for the Company’s content internationally, due in part to increased investment in internally-produced series, was partially offset by the benefit to 2016 from the international licensing sales of five Star Trek library series and the timing of domestic television licensing sales.

For the nine months ended September 30, 2017, the 5% decrease in operating income was primarily driven by the revenue decline.



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


theatrical release of a film, while the revenues for the respective film are recognized as earned through the film’s theatrical exhibition and distribution to other platforms.
Cable Networks (Showtime Networks, CBS Sports Network
Liquidity and Smithsonian Networks)Capital Resources
Three Months Ended September 30, 2017Sources and 2016Uses of Cash
We project anticipated cash requirements for our operating, investing and financing needs as well as cash flows expected to be generated and available to meet these needs. Our operating needs include, among other items, expenditures for content for our broadcast and cable networks and streaming services, including television and film programming, sports rights, and talent contracts, as well as advertising and marketing costs to promote our content and platforms; payments for leases, interest, and income taxes; and pension funding obligations. Our planned spending throughout 2023 includes continued increased investment in our streaming services. Our investing and financing spending includes capital expenditures; acquisitions; funding relating to new and existing investments, including SkyShowtime, our streaming joint venture with Comcast, under which both parent companies have committed to support initial operations over a multiyear period; discretionary share repurchases, dividends and principal payments on our outstanding indebtedness. The Company’s Board of Directors has determined to reduce the quarterly cash dividend on our Class A and Class B Common Stock to $.05 per share (or $.20 annually). We believe that our operating cash flows, cash and cash equivalents, which were $2.11 billion as of March 31, 2023, borrowing capacity under our $3.50 billion Credit Facility described below, as well as access to capital markets are sufficient to fund our operating, investing and financing requirements for the next twelve months.
 Three Months Ended September 30,
   Increase/(Decrease) 
Cable Networks2017
2016 $ % 
Revenues$840
 $598
 $242
 40 % 
Segment Operating Income$294
 $285
 $9
 3 % 
Segment Operating Income as a % of revenues35% 48%     
Depreciation and amortization$5
 $6
 $(1) (17)% 
Capital expenditures$5
 $4
 $1
 25 % 

ForOur funding for long-term obligations, including our long-term debt obligations due over the three months ended September 30, 2017,next five years, which were $2.85 billion as of March 31, 2023, as well as our other long term commitments, will come primarily from cash flows from operating activities, proceeds from noncore asset sales, including the 40%planned sale of Simon & Schuster, and our ability to refinance our debt. Any additional cash funding requirements are financed with short-term borrowings, including commercial paper, and long-term debt. To the extent that commercial paper is not available to us, the Credit Facility provides sufficient capacity to satisfy short-term borrowing needs. In addition, if necessary, we could increase our liquidity position by reducing non-committed spending. We routinely assess our capital structure and opportunistically enter into transactions to manage our outstanding debt maturities, which could result in revenues was driven by Showtime Networks’ distribution of the Floyd Mayweather/Conor McGregor pay-per-view boxing event, growtha charge from the Showtime digital streaming subscription offeringearly extinguishment of debt.

Our access to capital markets can be impacted by factors outside our control, including economic conditions; however, we believe that our strong balance sheet, cash flows, credit facility and higher international television licensing sales. These increases were partially offsetcredit ratings will provide us with adequate access to funding for our expected cash needs. The cost of any new borrowings is affected by lower domestic television licensing sales, largely duemarket conditions and short- and long-term debt ratings assigned by independent rating agencies, and there can be no assurance that we will be able to the sale of Penny Dreadful in the third quarter of 2016. As of September 30, 2017, subscriptions totaled approximately 25 million for Showtime, the Company’s premium television network,access capital markets on terms and the Showtime digital streaming subscription offering combined, 52 million for CBS Sports Network and 30 million for Smithsonian Networks.

For the three months ended September 30, 2017, the 3%increase in operating income primarily reflects the revenue growth, which was significantly offset by costs associated with the aforementioned pay-per-view boxing event.

Nine Months Ended September 30, 2017 and 2016conditions that will be favorable to us.
-41-
 Nine Months Ended September 30,
   Increase/(Decrease) 
Cable Networks2017 2016 $ % 
Revenues$1,954
 $1,659
 $295
 18% 
Segment Operating Income$795
 $740
 $55
 7% 
Segment Operating Income as a % of revenues41% 45%     
Depreciation and amortization$17
 $17
 $—
 —% 
Capital expenditures$12
 $8
 $4
 50% 

For the nine months ended September 30, 2017, the 18% increase in revenues was driven by the aforementioned pay-per-view boxing event, growth from the Showtime digital streaming subscription offering and higher international television licensing sales. These increases were partially offset by lower domestic television licensing sales, largely due to the sale of Penny Dreadful in 2016.
For the nine months ended September 30, 2017, the 7% increase in operating income was driven by the revenue growth, which was significantly offset by higher costs associated with the pay-per-view boxing event.



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Cash Flows
Publishing (Simon & Schuster)The changes in cash and cash equivalents were as follows:
Three Months Ended September 30, 2017 and 2016
Three Months Ended March 31,
20232022Increase/(Decrease)
Net cash flow (used for) provided by operating activities from:
Continuing operations$(483)$295 $(778)
Discontinued operations105 102 3 
Net cash flow (used for) provided by operating activities(378)397 (775)
Net cash flow used for investing activities(89)(80)(9)
Net cash flow used for financing activities(312)(1,271)959 
Effect of exchange rate changes on cash and cash equivalents3 (11)14 
Net decrease in cash and cash equivalents$(776)$(965)$189 
Operating Activities
 Three Months Ended September 30,
   Increase/(Decrease) 
Publishing2017
2016 $ % 
Revenues$228
 $226
 $2
 1% 
Segment Operating Income$46
 $44
 $2
 5% 
Segment Operating Income as a % of revenues20% 19%     
Depreciation and amortization$2
 $1
 $1
 100% 
Capital expenditures$1
 $1
 $—
 —% 
ForOperating cash flow from continuing operations for the three months ended September 30, 2017, the 1% increase in revenuesMarch 31, 2023 was driven by higher print book sales and growth in digital audio sales. Bestselling titles in the third quartera net use of 2017 included What Happened by Hillary Rodham Clinton and Sleeping Beauties by Stephen King and Owen King.

Forcash of $483 million compared to a net source of cash of $295 million for the three months ended September 30, 2017,March 31, 2022. The use of cash in 2023 as well as the 5% increasedecrease in operating income mainlycash flow from continuing operations compared to the prior-year period primarily reflects revenue growth.our increased investment in content.


Nine Months Ended September 30, 2017 and 2016
 Nine Months Ended September 30,
   Increase/(Decrease) 
Publishing2017 2016 $ % 
Revenues$595
 $558
 $37
 7 % 
Segment Operating Income$88
 $83
 $5
 6 % 
Segment Operating Income as a % of revenues15% 15%     
Depreciation and amortization$5
 $4
 $1
 25 % 
Capital expenditures$2
 $7
 $(5) (71)% 
ForCash flow provided by operating activities for the ninethree months ended September 30, 2017,March 31, 2023 and 2022 included payments for restructuring, merger-related costs and transformation initiatives of $65 million and $53 million, respectively. Since the 7% increasemerger of Viacom Inc. (“Viacom”) with and into CBS Corporation (“CBS”) (the “Merger”), we have invested in revenues was drivena number of transformation initiatives. Initially, these were undertaken to realize synergies related to the Merger. More recently, our transformation initiatives are related to future-state technology, including the unification and evolution of systems and platforms, and migration to the cloud. In addition, we are investing in future-state workspaces, including adapting our facilities to accommodate our hybrid and agile work model.
Cash flow provided by higher print book sales and growth in digital audio sales.

For the nine months ended September 30, 2017, the 6% increase in operating incomeactivities from discontinued operations reflects the revenue growth, which was partially offset by higher production costs.operating activities of Simon & Schuster.

Investing Activities
Three Months Ended March 31,
20232022
Investments$(43)$(59)
Capital expenditures (a)
(71)(52)
Other investing activities (b)
25 31 
Net cash flow used for investing activities$(89)$(80)
(a) Includes payments associated with the implementation of our transformation initiatives of $4 million and $8 million in 2023 and 2022, respectively.
(b) 2023 primarily reflects the collection of receivables associated with the sale of a 37.5% interest in The CW in the prior year and proceeds received from the disposition of certain channels in Latin America. 2022 reflects the disposition of international intangible assets.

-42-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Local Media (CBSTelevision Stations and CBS Local Digital Media)
Three Months Ended September 30, 2017 and 2016
 Three Months Ended September 30,
   Increase/(Decrease) 
Local Media2017 2016 $ % 
Revenues$397
 $409
 $(12) (3)% 
Segment Operating Income$105
 $122
 $(17) (14)% 
Segment Operating Income as a % of revenues26% 30%     
Depreciation and amortization$11
 $11
 $—
 — % 
Capital expenditures$8
 $9
 $(1) (11)% 
For the three months ended September 30, 2017, the 3% decrease in revenues was driven by lower political advertising sales, which was partially offset by growth in retransmission revenues.

For the three months ended September 30, 2017, the 14% decrease in operating income primarily reflects a decline in high-margin political advertising sales.

During the fourth quarter of 2017, the revenue comparison will continue to be negatively impacted by the benefit in 2016 from strong political advertising associated with U.S. federal and state elections.

Nine Months Ended September 30, 2017 and 2016
 Nine Months Ended September 30,
   Increase/(Decrease) 
Local Media2017 2016 $ % 
Revenues$1,218
 $1,253
 $(35) (3)% 
Segment Operating Income$355
 $402
 $(47) (12)% 
Segment Operating Income as a % of revenues29% 32%     
Depreciation and amortization$34
 $33
 $1
 3 % 
Capital expenditures$20
 $20
 $—
 — % 
For the nine months ended September 30, 2017, the 3% decrease in revenues was driven by lower advertising revenues, reflecting the benefit in 2016 from CBS’s broadcast of Super Bowl 50 and a decline in political advertising sales. This decrease was partially offset by growth in retransmission revenues.
For the nine months ended September 30, 2017, the 12% decrease in operating income primarily reflects lower revenues, as well as the mix of revenues compared to the same prior-year period. Retransmission revenues have associated network affiliation costs paid to the CBS Television Network, whereas political advertising sales have a high operating income margin.


Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Corporate
Three Months Ended September 30, 2017 and 2016
 Three Months Ended September 30,
   Increase/(Decrease) 
Corporate2017
2016 $ % 
Segment Operating Loss$(83) $(78) $(5) (6)% 
Depreciation and amortization$8
 $8
 $—
 — % 
Capital expenditures$5
 $5
 $—
 — % 
Corporate expenses include general corporate overhead, unallocated shared company expenses, pension and postretirement benefit costs for plans retained by the Company for previously divested businesses, and intercompany eliminations. For the three months ended September 30, 2017, corporate expenses increased 6%, driven primarily by higher employee-related costs.
Nine Months Ended September 30, 2017 and 2016
 Nine Months Ended September 30,
   Increase/(Decrease) 
Corporate2017 2016 $ % 
Segment Operating Loss$(247) $(245) $(2) (1)% 
Depreciation and amortization$25
 $26
 $(1) (4)% 
Capital expenditures$15
 $16
 $(1) (6)% 
Financial Position
 At At Increase/(Decrease) 
 September 30, 2017
December 31, 2016 $ % 
Current Assets:            
Cash and cash equivalents $144
   $598
  $(454) (76)% 
Receivables, net (a)
 3,598
   3,314
  284
 9
 
Programming and other inventory (b)
 1,830
   1,427
  403
 28
 
Prepaid expenses 182
   185
  (3) (2) 
All other current assets 540
   539
  1
 —
 
Total current assets $6,294
   $6,063
  $231
 4 % 
(a) The increase primarily relates to Showtime Networks’ distribution of the Floyd Mayweather/Conor McGregor pay-per-view boxing event.
(b) The increase primarily reflects the timing of payments for sports programming.
 At At Increase/(Decrease) 
 September 30, 2017 December 31, 2016 $ % 
Assets of discontinued operations (a)
 $3,325
   $4,291
  $(966) (23)% 
(a) The decrease primarily reflects a noncash charge of $980 million associated with a valuation allowance to reduce the carrying value of CBS Radio to the value indicated by the stock valuation of Entercom. (See Note 3 to the consolidated financial statements).


Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


 At At Increase/(Decrease) 
 September 30, 2017 December 31, 2016 $ % 
Current Liabilities:            
Accounts payable (a)
 $233
   $148
  $85
 57 % 
Accrued compensation (a)
 257
   369
  (112) (30) 
Participants’ share and royalties
payable
 997
   1,024
  (27) (3) 
Program rights (b)
 509
   290
  219
 76
 
Commercial paper 590
   450
  140
 31
 
All other current liabilities 1,466
   1,427
  39
 3
 
Total current liabilities $4,052
   $3,708
  $344
 9 % 
(a) The increase (decrease) reflects the timing of payments.
(b) The increase is primarily associated with Showtime Networks’ distribution of the Floyd Mayweather/Conor McGregor pay-per-view boxing event.
 At At Increase/(Decrease) 
 September 30, 2017 December 31, 2016 $ % 
Pension and postretirement
benefit obligations (a)
 $1,619
   $1,769
  $(150) (8)% 
(a) The decrease primarily reflects discretionary pension contributions of $100 million made during the first quarter of 2017 to prefund the Company’s qualified plans.
Cash Flows
The changes in cash and cash equivalents were as follows:
 Nine Months Ended September 30,
 2017 2016 Increase/(Decrease)
Net cash flow provided by operating activities from:       
Continuing operations$935
 $1,117
  $(182) 
Discontinued operations52
 189
  (137) 
Net cash flow provided by operating activities987
 1,306
  (319) 
Net cash flow used for investing activities from:       
Continuing operations(399) (179)  (220) 
Discontinued operations(18) (2)  (16) 
Net cash flow used for investing activities(417) (181)  (236) 
Net cash flow used for financing activities(1,018) (1,269)  251
 
Net decrease in cash and cash equivalents$(448) $(144)  $(304) 
Operating Activities. For the nine months ended September 30, 2017, the decrease in cash provided by operating activities from continuing operations was driven by the decline in advertising revenues including from the benefit in 2016 from CBS’s broadcast of Super Bowl 50, and discretionary pension contributions of $100 million made during the first quarter of 2017 to prefund the Company’s qualified plans. These decreases were partially offset by higher affiliate and subscription fee revenues.


Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Investing Activities
 Nine Months Ended September 30,
 2017
2016
Acquisitions (including acquired television library) (a)
 $(258)   $(51) 
Capital expenditures (112)   (111) 
Investments in and advances to investee companies (b)
 (67)   (44) 
Proceeds from dispositions (c)
 11
   20
 
All other investing activities, net 27
   7
 
Net cash flow used for investing activities from continuing operations (399)   (179) 
Net cash flow used for investing activities from discontinued operations (18)   (2) 
Net cash flow used for investing activities $(417)   $(181) 
(a) On August 27, 2017, CBS signed a binding agreement to acquire Ten Networks Holdings Limited (“Network Ten”), one of three major commercial broadcast networks in Australia, after Network Ten entered into voluntary administration. During the third quarter of 2017, the Company paid $138 million of the purchase price, primarily for the assumption of the secured debt of Network Ten’s lenders, and funding for working capital. The transaction, which is expected to close in the fourth quarter, will be completed in accordance with Australian applicable laws and procedures and is subject to certain regulatory approvals. 2017 also includes the acquisition of a television library and 2016 reflects the acquisition of a sports-focused digital media business.
(b) Mainly includes the Company’s investment in The CW as well as its other domestic and international television joint ventures.
(c) 2016 primarily reflects sales of internet businesses in China.

Financing ActivitiesLiquidity and Capital Resources
Sources and Uses of Cash
 Nine Months Ended September 30,
 2017 2016
Repurchase of CBS Corp. Class B Common Stock $(1,111)   $(1,534) 
Proceeds from short-term debt borrowings, net 140
   33
 
Proceeds from issuance of senior notes 889
   685
 
Repayment of senior notes and debentures (701)   (199) 
Dividends (224)   (209) 
Payment of payroll taxes in lieu of issuing shares for stock-based compensation (89)   (57) 
Proceeds from exercise of stock options 81
   13
 
All other financing activities, net (3)   (1) 
Net cash flow used for financing activities $(1,018)   $(1,269) 
We project anticipated cash requirements for our operating, investing and financing needs as well as cash flows expected to be generated and available to meet these needs. Our operating needs include, among other items, expenditures for content for our broadcast and cable networks and streaming services, including television and film programming, sports rights, and talent contracts, as well as advertising and marketing costs to promote our content and platforms; payments for leases, interest, and income taxes; and pension funding obligations. Our planned spending throughout 2023 includes continued increased investment in our streaming services. Our investing and financing spending includes capital expenditures; acquisitions; funding relating to new and existing investments, including SkyShowtime, our streaming joint venture with Comcast, under which both parent companies have committed to support initial operations over a multiyear period; discretionary share repurchases, dividends and principal payments on our outstanding indebtedness. The Company’s Board of Directors has determined to reduce the quarterly cash dividend on our Class A and Class B Common Stock to $.05 per share (or $.20 annually). We believe that our operating cash flows, cash and cash equivalents, which were $2.11 billion as of March 31, 2023, borrowing capacity under our $3.50 billion Credit Facility described below, as well as access to capital markets are sufficient to fund our operating, investing and financing requirements for the next twelve months.


Free Cash Flow
FreeOur funding for long-term obligations, including our long-term debt obligations due over the next five years, which were $2.85 billion as of March 31, 2023, as well as our other long term commitments, will come primarily from cash flow is a non-GAAP financial measure. Free cash flow reflects the Company’s net cash flow provided by (used for)flows from operating activities, before operatingproceeds from noncore asset sales, including the planned sale of Simon & Schuster, and our ability to refinance our debt. Any additional cash flowfunding requirements are financed with short-term borrowings, including commercial paper, and long-term debt. To the extent that commercial paper is not available to us, the Credit Facility provides sufficient capacity to satisfy short-term borrowing needs. In addition, if necessary, we could increase our liquidity position by reducing non-committed spending. We routinely assess our capital structure and opportunistically enter into transactions to manage our outstanding debt maturities, which could result in a charge from discontinued operationsthe early extinguishment of debt.

Our access to capital markets can be impacted by factors outside our control, including economic conditions; however, we believe that our strong balance sheet, cash flows, credit facility and lesscredit ratings will provide us with adequate access to funding for our expected cash needs. The cost of any new borrowings is affected by market conditions and short- and long-term debt ratings assigned by independent rating agencies, and there can be no assurance that we will be able to access capital expenditures. The Company’s calculation of free cash flow includes capital expenditures because investment in capital expenditures is a use of cashmarkets on terms and conditions that is directly relatedwill be favorable to the Company’s operations. The Company’s net cash flow provided by (used for) operating activities is the most directly comparable GAAP financial measure.

us.

-41-



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Cash Flows
Management believes freeThe changes in cash and cash equivalents were as follows:
Three Months Ended March 31,
20232022Increase/(Decrease)
Net cash flow (used for) provided by operating activities from:
Continuing operations$(483)$295 $(778)
Discontinued operations105 102 3 
Net cash flow (used for) provided by operating activities(378)397 (775)
Net cash flow used for investing activities(89)(80)(9)
Net cash flow used for financing activities(312)(1,271)959 
Effect of exchange rate changes on cash and cash equivalents3 (11)14 
Net decrease in cash and cash equivalents$(776)$(965)$189 
Operating Activities
Operating cash flow provides investors with an important perspective onfrom continuing operations for the three months ended March 31, 2023 was a net use of cash availableof $483 million compared to a net source of cash of $295 million for the three months ended March 31, 2022. The use of cash in 2023 as well as the decrease in operating cash flow from continuing operations compared to the Company to service debt, make strategic acquisitions and investments, maintain its capital assets, satisfy its tax obligations, and fund ongoing operations and working capital needs. As a result, free cash flow is a significant measure of the Company’s ability to generate long-term value. It is useful for investors to know whether this ability is being enhanced or degraded as a result of the Company’s operating performance. The Company believes the presentation of free cash flow is relevant and useful for investors because it allows investors to evaluate the cash generated from the Company’s underlying operationsprior-year period primarily reflects our increased investment in a manner similar to the method used by management. Free cash flow is one of several components of incentive compensation targets for certain management personnel. In addition, free cash flow is a primary measure used externally by the Company’s investors, analysts and industry peers for purposes of valuation and comparison of the Company’s operating performance to other companies in its industry.content.


As free cash flow is not a measure calculated in accordance with GAAP, free cash flow should not be considered in isolation of, or as a substitute for, either net cash flow provided by (used for) operating activities as a measure of liquidity or net earnings (loss) as a measure of operating performance. Free cash flow, as the Company calculates it, may not be comparable to similarly titled measures employed by other companies. In addition, free cash flow as a measure of liquidity has certain limitations, does not necessarily represent funds available for discretionary use and is not necessarily a measure of the Company’s ability to fund its cash needs. When comparing free cash flow to net cash flow provided by (used for) operating activities, the most directly comparable GAAP financial measure, users of this financial information should consider the types of events and transactions that are not reflected in free cash flow.

The following table presents a reconciliation of the Company’s net cashCash flow provided by operating activities to free cash flow.
 Nine Months Ended
 September 30,
 2017 2016
Net cash flow provided by operating activities$987
 $1,306
Capital expenditures(112) (111)
Exclude operating cash flow from discontinued operations52
 189
Free cash flow$823
 $1,006

Repurchase of Company Stock and Cash Dividends
Duringfor the third quarter of 2017, the Company repurchased 3.9 million shares of its Class B Common Stock under its share repurchase program for $250 million, at an average cost of $63.52 per share. During the ninethree months ended September 30, 2017,March 31, 2023 and 2022 included payments for restructuring, merger-related costs and transformation initiatives of $65 million and $53 million, respectively. Since the Company repurchased 16.2merger of Viacom Inc. (“Viacom”) with and into CBS Corporation (“CBS”) (the “Merger”), we have invested in a number of transformation initiatives. Initially, these were undertaken to realize synergies related to the Merger. More recently, our transformation initiatives are related to future-state technology, including the unification and evolution of systems and platforms, and migration to the cloud. In addition, we are investing in future-state workspaces, including adapting our facilities to accommodate our hybrid and agile work model.
Cash flow provided by operating activities from discontinued operations reflects the operating activities of Simon & Schuster.
Investing Activities
Three Months Ended March 31,
20232022
Investments$(43)$(59)
Capital expenditures (a)
(71)(52)
Other investing activities (b)
25 31 
Net cash flow used for investing activities$(89)$(80)
(a) Includes payments associated with the implementation of our transformation initiatives of $4 million sharesand $8 million in 2023 and 2022, respectively.
(b) 2023 primarily reflects the collection of its Class B Common Stock for $1.05 billion, at an average costreceivables associated with the sale of $64.70 per share, leaving $3.06 billiona 37.5% interest in The CW in the prior year and proceeds received from the disposition of authorization at September 30, 2017.certain channels in Latin America. 2022 reflects the disposition of international intangible assets.

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During the third quarter of 2017, the Company declared a quarterly cash dividend of $.18 on its Class A and Class B Common Stock, resulting in total dividends of $73 million, which were paid on October 1, 2017.



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Capital Structure
The following table sets forth the Company’s debt.
 At At
 September 30, 2017 December 31, 2016
Commercial paper $590
   $450
 
Senior debt (1.95% – 7.875% due 2017 – 2045) (a)
 9,039
   8,850
 
Obligations under capital leases 60
   75
 
Total debt 9,689
   9,375
 
Less commercial paper 590
   450
 
Less current portion of long-term debt 19
   23
 
Total long-term debt, net of current portion $9,080
   $8,902
 
(a) At September 30, 2017 and December 31, 2016, the senior debt balances included (i) a net unamortized discount of $55 million and $52 million, respectively, (ii) unamortized deferred financing costs of $45 million and $43 million, respectively, and (iii) a $2 million decrease and a $5 million increase, respectively, in the carrying value of the debt relating to previously settled fair value hedges. The face value of the Company’s senior debt was $9.14 billion and $8.94 billion at September 30, 2017 and December 31, 2016, respectively.

In July 2017, the Company issued $400 million of 2.50% senior notes due 2023 and $500 million of 3.375% senior notes due 2028. The Company used the net proceeds from these issuances to repay its $400 million outstanding 1.95% senior notes that matured on July 1, 2017 and to redeem all of its $300 million outstanding 4.625% senior notes due May 2018. The remaining proceeds were used for general corporate purposes, including the repayment of short-term borrowings, including commercial paper.

The early redemption of the $300 million 4.625% senior notes due May 2018 resulted in a pre-tax loss on early extinguishment of debt of $5 million ($3 million, net of tax) for the three and nine months ended September 30, 2017.

Commercial Paper
The Company had outstanding commercial paper borrowings under its $2.5 billion commercial paper program of $590 million and $450 million at September 30, 2017 and December 31, 2016, respectively, each with maturities of less than 60 days. The weighted average interest rate for these borrowings was 1.44% at September 30, 2017 and 0.98% at December 31, 2016.

Credit Facility
At September 30, 2017, the Company had a $2.5 billion revolving credit facility (the “Credit Facility”) which expires in June 2021. The Credit Facility requires the Company to maintain a maximum Consolidated Leverage Ratio of 4.5x at the end of each quarter as further described in the Credit Facility. At September 30, 2017, the Company’s Consolidated Leverage Ratio was approximately 3.0x.

The Consolidated Leverage Ratio is the ratio of the Company’s indebtedness from continuing operations, adjusted to exclude certain capital lease obligations, at the end of a quarter, to the Company’s Consolidated EBITDA for the trailing four consecutive quarters. Consolidated EBITDA is defined in the Credit Facility as operating income plus interest income and before depreciation, amortization and certain other noncash items.



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


The Credit Facility is used for general corporate purposes. At September 30, 2017, the Company had no borrowings outstanding under the Credit Facility and the remaining availability under the Credit Facility, net of outstanding letters of credit, was $2.49 billion.

Liquidity and Capital Resources
The Company continually projectsSources and Uses of Cash
We project anticipated cash requirements for itsour operating, investing and financing needs as well as cash flows expected to be generated from operating activitiesand available to meet these needs. The Company’sOur operating needs include, among other items, commitmentsexpenditures for sports programming rights,content for our broadcast and cable networks and streaming services, including television and film programming, sports rights, and talent contracts, operatingas well as advertising and marketing costs to promote our content and platforms; payments for leases, interest, payments,and income taxes; and pension funding obligations. The Company’sOur planned spending throughout 2023 includes continued increased investment in our streaming services. Our investing and financing spending includes capital expenditures,expenditures; acquisitions; funding relating to new and existing investments, including SkyShowtime, our streaming joint venture with Comcast, under which both parent companies have committed to support initial operations over a multiyear period; discretionary share repurchases, dividends and principal payments on itsour outstanding indebtedness. The Company believesCompany’s Board of Directors has determined to reduce the quarterly cash dividend on our Class A and Class B Common Stock to $.05 per share (or $.20 annually). We believe that itsour operating cash flows;flows, cash and cash equivalents;equivalents, which were $2.11 billion as of March 31, 2023, borrowing capacity under theour $3.50 billion Credit Facility which had $2.49 billion of remaining availability at September 30, 2017; anddescribed below, as well as access to capital markets are sufficient to fund itsour operating, investing and financing requirements for the next twelve months.


The Company’sOur funding for short-term and long-term obligations, including our long-term debt obligations due over the next five years, which were $2.85 billion as of March 31, 2023, as well as our other long term commitments, will come primarily from cash flows from operating activities.activities, proceeds from noncore asset sales, including the planned sale of Simon & Schuster, and our ability to refinance our debt. Any additional cash funding requirements are financed with short-term borrowings, including commercial paper, and long-term debt. To the extent that commercial paper is not available to us, the Company, the existing Credit Facility provides sufficient capacity to satisfy short-term borrowing needs.The Company In addition, if necessary, we could increase our liquidity position by reducing non-committed spending. We routinely assesses itsassess our capital structure and opportunistically entersenter into transactions to lower its interest expense,manage our outstanding debt maturities, which could result in a charge from the early extinguishment of debt.


Our access to capital markets can be impacted by factors outside our control, including economic conditions; however, we believe that our strong balance sheet, cash flows, credit facility and credit ratings will provide us with adequate access to funding for our expected cash needs. The cost of any new borrowings is affected by market conditions and short- and long-term debt ratings assigned by independent rating agencies, and there can be no assurance that we will be able to access capital markets on terms and conditions that will be favorable to us.
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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)
Cash Flows
The Company’s long-termchanges in cash and cash equivalents were as follows:
Three Months Ended March 31,
20232022Increase/(Decrease)
Net cash flow (used for) provided by operating activities from:
Continuing operations$(483)$295 $(778)
Discontinued operations105 102 3 
Net cash flow (used for) provided by operating activities(378)397 (775)
Net cash flow used for investing activities(89)(80)(9)
Net cash flow used for financing activities(312)(1,271)959 
Effect of exchange rate changes on cash and cash equivalents3 (11)14 
Net decrease in cash and cash equivalents$(776)$(965)$189 
Operating Activities
Operating cash flow from continuing operations for the three months ended March 31, 2023 was a net use of cash of $483 million compared to a net source of cash of $295 million for the three months ended March 31, 2022. The use of cash in 2023 as well as the decrease in operating cash flow from continuing operations compared to the prior-year period primarily reflects our increased investment in content.

Cash flow provided by operating activities for the three months ended March 31, 2023 and 2022 included payments for restructuring, merger-related costs and transformation initiatives of $65 million and $53 million, respectively. Since the merger of Viacom Inc. (“Viacom”) with and into CBS Corporation (“CBS”) (the “Merger”), we have invested in a number of transformation initiatives. Initially, these were undertaken to realize synergies related to the Merger. More recently, our transformation initiatives are related to future-state technology, including the unification and evolution of systems and platforms, and migration to the cloud. In addition, we are investing in future-state workspaces, including adapting our facilities to accommodate our hybrid and agile work model.
Cash flow provided by operating activities from discontinued operations reflects the operating activities of Simon & Schuster.
Investing Activities
Three Months Ended March 31,
20232022
Investments$(43)$(59)
Capital expenditures (a)
(71)(52)
Other investing activities (b)
25 31 
Net cash flow used for investing activities$(89)$(80)
(a) Includes payments associated with the implementation of our transformation initiatives of $4 million and $8 million in 2023 and 2022, respectively.
(b) 2023 primarily reflects the collection of receivables associated with the sale of a 37.5% interest in The CW in the prior year and proceeds received from the disposition of certain channels in Latin America. 2022 reflects the disposition of international intangible assets.
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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)
Financing Activities
Three Months Ended March 31,
20232022
Proceeds from issuance of notes and debentures$— $991 
Repayment of notes and debentures— (2,001)
Dividends paid on preferred stock(14)(14)
Dividends paid on common stock(166)(158)
Payment of payroll taxes in lieu of issuing shares for stock-based compensation(16)(9)
Payments to noncontrolling interests(89)(77)
Other financing activities(27)(3)
Net cash flow used for financing activities$(312)$(1,271)
Dividends
We declared a quarterly cash dividend of $.24 per share on our Class A and Class B Common Stock during each of the three-month periods ended March 31, 2023 and 2022, resulting in total dividends of $161 million and $159 million, respectively.
We declared a quarterly cash dividend of $1.4375 per share on our 5.75% Series A Mandatory Convertible Preferred Stock during each of the three-month periods ended March 31, 2023 and 2022, resulting in total dividends of $14.4 million for each of the respective periods.
Capital Structure
The following table sets forth our debt.
AtAt
March 31, 2023December 31, 2022
Senior debt (2.90%-7.875% due 2023-2050)$14,155 $14,149 
Junior debt (6.25% and 6.375% due 2057 and 2062)1,632 1,632 
Other bank borrowings58 55 
Obligations under finance leases8 10 
Total debt (a)
15,853 15,846 
Less current portion240 239 
Total long-term debt, net of current portion$15,613 $15,607 
(a) At March 31, 2023 and December 31, 2022, the senior and junior subordinated debt obligationsbalances included (i) a net unamortized discount of $437 million and $442 million, respectively, and (ii) unamortized deferred financing costs of $88 million and $89 million, respectively. The face value of our total debt was $16.38 billion at both March 31, 2023 and December 31, 2022.

During the first quarter of 2022, we redeemed $1.42 billion of senior notes, prior to maturity, for an aggregate redemption price of $1.48 billion and $520 million of 5.875% junior subordinated debentures due overFebruary 2057 at par. These redemptions resulted in a total pre-tax loss on extinguishment of debt of $73 million.

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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)
During the nextfirst quarter of 2022, we also issued $1.00 billion of 6.375% junior subordinated debentures due 2062. The interest rate on these debentures will reset on March 30, 2027, and every five years thereafter to a fixed rate equal to the 5-year Treasury Rate (as defined pursuant to the terms of $2.10the debentures) plus a spread. These debentures can be called by us at par plus a make whole premium any time before March 30, 2027, or at par on March 30, 2027, or at any interest payment date thereafter.

Our 6.25% junior subordinated debentures due February 2057 accrue interest at the stated fixed rate until February 28, 2027, on which date the rate will switch to a floating rate. These debentures can be called by us at par at any time after the expiration of the fixed-rate period.

The subordination, interest deferral option and extended term of our junior subordinated debentures provide significant credit protection measures for senior creditors and, as a result of these features, the debentures received a 50% equity credit by Standard & Poor’s Rating Services and Fitch Ratings Inc., and a 25% equity credit by Moody’s Investors Service, Inc.

Commercial Paper
At both March 31, 2023 and December 31, 2022, we had no outstanding commercial paper borrowings.

Credit Facility
In March 2023, we amended and extended our $3.50 billion revolving credit facility (the “Credit Facility”), which now matures in January 2027 (the “2023 Amendment”). The Credit Facility is used for general corporate purposes and to support commercial paper borrowings, if any. We may, at our option, also borrow in certain foreign currencies up to specified limits under the Credit Facility. Borrowing rates under the Credit Facility are expecteddetermined at the time of each borrowing and are generally based on either the prime rate in the U.S. or an applicable benchmark rate plus a margin (based on our senior unsecured debt rating), depending on the type and tenor of the loans entered into. Under the 2023 Amendment, we replaced LIBOR as the benchmark rate for loans denominated in U.S. dollars with Term SOFR. The benchmark rate for loans denominated in euros, sterling and yen is based on EURIBOR, SONIA and TIBOR, respectively. The Credit Facility was also amended to include a provision that the occurrence of a Change of Control (as defined in the amended credit agreement) of Paramount will be an event of default that would give the lenders the right to accelerate any outstanding loans and terminate their commitments. At March 31, 2023, we had no borrowings outstanding under the Credit Facility and the remaining availability under the Credit Facility, net of outstanding letters of credit, was $3.50 billion.

The Credit Facility has one principal financial covenant which sets a maximum Consolidated Total Leverage Ratio (“Leverage Ratio”) at the end of each quarter, which prior to the 2023 Amendment was 4.5x. Under the 2023 Amendment, the maximum Leverage Ratio was increased to 5.75x for each quarter through and including the quarter ending September 30, 2024, and will then decrease to 5.5x for the quarters ending December 31, 2024 and March 31, 2025, with decreases of 0.25x for each subsequent quarter until it reaches 4.5x for the quarter ending March 31, 2026. The Leverage Ratio reflects the ratio of our Consolidated Indebtedness, net of unrestricted cash and cash equivalents at the end of a quarter, to our Consolidated EBITDA (each as defined in the amended credit agreement) for the trailing twelve-month period. Under the 2023 Amendment, the definition of the Leverage Ratio was also modified to set the maximum amount of unrestricted cash and cash equivalents that can be netted against Consolidated Indebtedness to $1.50 billion for quarters ending on or after September 30, 2024. In addition, under the 2023 Amendment, Simon & Schuster shall be treated as a continuing operation for the purposes of calculating Consolidated EBITDA until its disposition. We met the covenant as of March 31, 2023.

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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)
Other Bank Borrowings
At March 31, 2023 and December 31, 2022, we had bank borrowings under Miramax’s $300 million credit facility, which matured in April 2023, of $58 million and $55 million, respectively, with weighted average interest rates of 7.48% and 7.09%, respectively.
Guarantees
Letters of Credit and Surety Bonds
At March 31, 2023, we had outstanding letters of credit and surety bonds of $178 million that were not recorded on the Consolidated Balance Sheet. Letters of credit and surety bonds are primarily used as security against non-performance in the normal course of business.

CBS Television City
In connection with the sale of the CBS Television City property and sound stage operation (“CBS Television City”) in 2019, we guaranteed a specified level of cash flows to be fundedgenerated by cash generated from operating activitiesthe business during the first five years following the completion of the sale. Included in “Other current liabilities” on the Consolidated Balance Sheet at March 31, 2023 is a liability totaling $25 million, reflecting the present value of the remaining estimated amount payable under the guarantee obligation.

Lease Guarantees
We have certain indemnification obligations with respect to leases primarily associated with the previously discontinued operations of Famous Players Inc. These lease commitments totaled $17 million at March 31, 2023, and are presented within “Other liabilities” on the Consolidated Balance Sheet. The amount of lease commitments varies over time depending on the expiration or termination of individual underlying leases, or the related indemnification obligation, and foreign exchange rates, among other things. We may also have exposure for certain other expenses related to the leases, such as property taxes and common area maintenance. We believe our accrual is sufficient to meet any future obligations based on our consideration of available financial information, the lessees’ historical performance in meeting their lease obligations and the Company’s abilityunderlying economic factors impacting the lessees’ business models.

Other
In the course of our business, we both provide and receive indemnities which are intended to refinanceallocate certain risks associated with business transactions. Similarly, we may remain contingently liable for various obligations of a business that has been divested in the event that a third party does not live up to its debt.obligations under an indemnification obligation. We record a liability for our indemnification obligations and other contingent liabilities when probable and reasonably estimable.

The Company expects to make a pension contribution of $500 million during the fourth quarter of 2017, which is expected to be partially funded by long-term borrowings.

Legal Matters
General.General
On an ongoing basis, the Companywe vigorously defends itselfdefend ourselves in numerous lawsuits and proceedings and respondsrespond to various investigations and inquiries from federal, state, local and international authorities (collectively, ‘‘litigation’’“Litigation”). Litigation may be brought against the Companyus without merit, is inherently uncertain and always difficult to predict. However, based on itsour understanding and evaluation of the relevant facts and circumstances, the Company believes we believe
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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)
that the below-described legalfollowing matters and other litigation to which it is a party are not likely, in the aggregate, to haveresult in a material adverse effect on itsour business, financial condition and results of operations, financial position operations.

Stockholder Matters
Litigation Relating to the Merger
Beginning in February 2020, three purported CBS stockholders filed separate derivative and/or cash flows. Underputative class action lawsuits in the SeparationCourt of Chancery of the State of Delaware (the “Delaware Chancery Court”). In March 2020, the Delaware Chancery Court consolidated the three lawsuits and appointed Bucks County Employees Retirement Fund and International Union of Operating Engineers of Eastern Pennsylvania and Delaware as co-lead plaintiffs for the consolidated action captioned In re CBS Corporation Stockholder Class Action and Derivative Litigation (the “CBS Litigation”). In April 2020, the lead plaintiffs filed a Verified Consolidated Class Action and Derivative Complaint (as used in this paragraph, the “Complaint”) against Shari E. Redstone, National Amusements, Inc., Sumner M. Redstone National Amusements Trust, additional members of the CBS Board of Directors (including Candace K. Beinecke, Barbara M. Byrne, Gary L. Countryman, Linda M. Griego, Robert N. Klieger, Martha L. Minow, Susan Schuman, Frederick O. Terrell and Strauss Zelnick), former CBS President and Acting Chief Executive Officer Joseph Ianniello and the Company as nominal defendant. The Complaint alleges breaches of fiduciary duties in connection with the negotiation and approval of an Agreement and Plan of Merger, dated as of August 13, 2019, between CBS and Viacom (as amended, the “Merger Agreement”). The Complaint also alleges waste and unjust enrichment in connection with certain aspects of Mr. Ianniello’s compensation awards. The Complaint seeks unspecified damages, costs and expenses, as well as other relief. In June 2020, the defendants filed motions to dismiss the Complaint. In January 2021, the Delaware Chancery Court dismissed one disclosure claim, while allowing all other claims against the defendants to proceed. On January 7, 2022, the Delaware Chancery Court granted Bucks County Employees Retirement Fund’s motion to withdraw as a co-lead plaintiff in the CBS Litigation. In December 2022, the Delaware Chancery Court dismissed the fiduciary duty claim against Mr. Klieger.

In April 2023, the parties to the CBS Litigation agreed to settle the CBS Litigation on the terms and conditions set forth in a binding term sheet (the “CBS Term Sheet”), which will be incorporated into a long-form settlement agreement that will be subject to the final approval of the Delaware Chancery Court. The CBS Term Sheet provides for, among other things, the final dismissal of the CBS Litigation in exchange for a settlement payment to the Company in the amount of $167.5 million, less administrative costs and plaintiffs’ counsels’ fees and expenses.

Beginning in November 2019, four purported Viacom stockholders filed separate putative class action lawsuits in the Delaware Chancery Court. In January 2020, the Delaware Chancery Court consolidated the four lawsuits. In February 2020, the Delaware Chancery Court appointed California Public Employees’ Retirement System (“CalPERS”) as lead plaintiff for the consolidated action. Subsequently, in February 2020, CalPERS, together with Park Employees’ and Retirement Board Employees’ Annuity and Benefit Fund of Chicago and Louis M. Wilen, filed a First Amended Verified Class Action Complaint (as used in this paragraph, the “Complaint”) against NAI, NAI Entertainment Holdings LLC, Shari E. Redstone, the members of the special transaction committee of the Viacom Board of Directors (comprised of Thomas J. May, Judith A. McHale, Ronald L. Nelson and Nicole Seligman) and our President and Chief Executive Officer and director, Robert M. Bakish (as used in this paragraph, the “Viacom Litigation”). The Complaint alleges breaches of fiduciary duties to Viacom stockholders in connection with the negotiation and approval of the Merger Agreement. The Complaint seeks unspecified damages, costs and expenses, as well as other relief. In May 2020, the defendants filed motions to dismiss. In December 2020, the Delaware Chancery Court dismissed the claims against Mr. Bakish, while allowing the claims against the remaining defendants to proceed. In February 2023, the parties to the Viacom Litigation agreed to settle the Viacom Litigation on the terms and conditions set forth in a binding term sheet (the “Viacom Term Sheet”),
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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)
which was incorporated into a long-form settlement agreement entered into in March 2023 (the “Settlement Agreement”). The Viacom Term Sheet and Settlement Agreement provide for, among other things, the final dismissal of the Viacom Litigation in exchange for a settlement payment in the amount of $122.5 million, which we have recorded in "Other current liabilities" on the Consolidated Balance Sheets. The settlement of the Viacom Litigation is subject to the final approval of the Delaware Chancery Court, and the vast majority of the settlement payment will be due no less than five business days before the final settlement hearing.

Litigation Related to Stock Offerings
In August 2021, Camelot Event Driven Fund filed a putative securities class action lawsuit in New York Supreme Court, County of New York, and in November 2021, an amended complaint was filed that, among other changes, added an additional named plaintiff (as used in this paragraph, the “Complaint”). The Complaint is purportedly on behalf of investors who purchased shares of the Company’s Class B Common Stock and 5.75% Series A Mandatory Convertible Preferred Stock pursuant to public securities offerings completed in March 2021, and was filed against the Company, certain senior executives, members of our Board of Directors, and the underwriters involved in the offerings. The Complaint asserts violations of federal securities law and alleges that the offering documents contained material misstatements and omissions, including through an alleged failure to adequately disclose certain total return swap transactions involving Archegos Capital Management referenced to our securities and related alleged risks to the Company’s stock price. In December 2021, the plaintiffs filed a stipulation seeking the voluntary dismissal without prejudice of the outside director defendants from the lawsuit, which the Court subsequently ordered. On the same date, the defendants filed motions to dismiss the lawsuit, which were heard in January 2023. On February 7, 2023, the Court dismissed all claims against the Company while allowing the claims against the underwriters to proceed. The plaintiffs and underwriter defendants have appealed the ruling.

Litigation Related to Television Station Owners
In September 2019, the Company was added as a defendant in a multi-district putative class action lawsuit filed in the United States District Court for the Northern District of Illinois. The lawsuit was filed by parties that claim to have purchased broadcast television spot advertising beginning about January 2014 on television stations owned by one or more of the defendant television station owners and alleges the sharing of allegedly competitively sensitive information among such television stations in alleged violation of the Sherman Antitrust Act. The action, which names the Company among fourteen total defendants, seeks monetary damages, attorneys’ fees, costs and interest as well as injunctions against the allegedly unlawful conduct. In October 2019, the Company and Viacom Inc.,other defendants filed a motion to dismiss the matter, which was denied by the Court in November 2020. We have reached an agreement in principle with the plaintiffs to settle the lawsuit. The settlement, which will include no admission of liability or wrongdoing by the Company, and Viacom Inc. have agreedwill be subject to defend and indemnify the other in certain litigation in which the Company and/or Viacom Inc. is named.Court approval.


Claims Related to Former Businesses: Asbestos.    The Company isBusinesses
Asbestos
We are a defendant in lawsuits claiming various personal injuries related to asbestos and other materials, which allegedly occurred principally as a result of exposure caused by various products manufactured by Westinghouse, a predecessor, generally prior to the early 1970s. Westinghouse was neither a producer nor a manufacturer of asbestos. The Company isWe are typically named as one of a large number of defendants in both state and federal cases. In the majority of asbestos lawsuits, the plaintiffs have not identified which of the Company’sour products is the basis of a claim. Claims against the Companyus in which a product has been identified principallymost commonly relate to exposures allegedly caused byallegations of exposure to asbestos-containing insulating material used in conjunction with turbines sold for power-generation, industrial and marine use.electrical equipment.



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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Claims are frequently filed and/or settled in groups, which may make the amount and timing of settlements, and the number of pending claims, subject to significant fluctuation from period to period. The Company doesWe do not report as pending those claims on inactive, stayed, deferred or similar dockets whichthat some jurisdictions have established for claimants who allege minimal or no impairment. As of September 30, 2017, the CompanyMarch 31, 2023, we had pending approximately 32,76021,640 asbestos claims, as compared with approximately 33,61021,580 as of December 31, 2016 and 34,400 as of September 30, 2016.2022. During the thirdfirst quarter of 2017, the Company2023, we received approximately 720650 new claims and closed or moved to an inactive docket approximately 1,200590 claims. The Company reportsWe report claims as closed when it becomeswe become aware that a dismissal order has been entered by a court or when the Company haswe have reached agreement with the claimants on the material terms of a settlement. Settlement costs depend on the seriousness of the injuries that form the basis of the claims, the quality of evidence supporting the claims and other factors. In 2016,Our total costs for the Company’s costsyears 2022 and 2021 for settlement and defense of asbestos claims after insurance recoveries and taxesnet of tax were approximately $48 million. In 2015, as the result of an insurance settlement, insurance recoveries exceeded the Company’s after tax costs for settlement$57 million and defense of asbestos claims by approximately $5 million. The Company’s$63 million, respectively. Our costs for settlement and defense of asbestos claims may vary year to year and insurance proceeds are not always recovered in the same period as the insured portion of the expenses.


Filings include claims for individuals suffering from mesothelioma, a rare cancer, the risk of which is allegedly increased by exposure to asbestos; lung cancer, a cancer which may be caused by various factors, one of which is alleged to be asbestos exposure; other cancers, and conditions that are substantially less serious, including claims brought on behalf of individuals who are asymptomatic as to an allegedly asbestos-related disease. The predominant number of pending claims against the Companyus are non-cancer claims. The Company believesIt is difficult to predict future asbestos liabilities, as events and circumstances may impact the estimate of our asbestos liabilities, including, among others, the number and types of claims and average cost to resolve such claims. We record an accrual for a loss contingency when it is both probable that its reservesa liability has been incurred and insurance are adequate to cover its asbestos liabilities. This beliefwhen the amount of the loss can be reasonably estimated. Our liability estimate is based upon many factors, and assumptions, including the number of outstanding claims, estimated average cost per claim, the breakdown of claims by disease type, historic claim filings, costs per claim of resolution and the filing of new claims. While the number of asbestos claims, filed against the Company has remained generally flat in recent years, it is difficult to predictas well as consultation with a third party firm on trends that may impact our future asbestos liability. While we believe that our accrual for matters related to our predecessor operations, including environmental and asbestos, are adequate, there can be no assurance that circumstances will not change in future periods, and as a result our actual liabilities as events and circumstances may occur including, among others, the number and types of claims and average cost to resolve such claims, which could affect the Company’s estimate of its asbestos liabilities.be higher or lower than our accrual.


Other.    The Company fromOther
From time to time, receiveswe receive claims from federal and state environmental regulatory agencies and other entities asserting that it iswe are or may be liable for environmental cleanup costs and related damages principally relating to our historical and predecessor operations of the Company.operations. In addition, the Company from time to time receiveswe receive personal injury claims including toxic tort and product liability claims (other than asbestos) arising from our historical operations of the Company and its predecessors.

Related Parties
See Note 54 to the consolidated financial statements.
Recent Pronouncements and Adoption of New Accounting Standards
See Note 1 to the consolidated financial statements.

Critical Accounting Policies
See Item 7, Management’s Discussion and Analysis of Results of Operations and Financial Condition in the Company’sour Annual Report on Form 10-K for the fiscal year ended December 31, 2016,2022, for a discussion of the Company’sour critical accounting policies.



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Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Cautionary StatementNote Concerning Forward-Looking Statements
This quarterly reportQuarterly Report on Form 10-Q including “Item 2 - Management’s Discussion and Analysis of Results of Operations and Financial Condition,” contains both historical and forward‑looking statements.statements, including statements related to our future results and performance. All statements other thanthat are not statements of historical fact are, or may be deemed to be, forward‑lookingforward-looking statements within the meaning of section 27A of the Private Securities Litigation Reform Act of 1933 and section 21E of the Securities Exchange Act of 1934.1995. Similarly, statements that describe our objectives, plans or goals are or may be forward-looking statements. These forward‑lookingforward-looking statements are not based on historical facts, but rather reflect the Company’sour current expectations concerning future results and events. These forward-looking statementsevents; generally can be identified by the use of statements that include phrases such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “foresee,” “likely,” “will,” “may,” “could,” “estimate” or other similar words or phrases. Similarly, statements that describe the Company’s objectives, plans or goals are or may be forward‑looking statements. These forward‑looking statementsphrases; and involve known and unknown risks, uncertainties and other factors that are difficult to predict and which may cause theour actual results, performance or achievements of the Company to be different from any future results, performance andor achievements expressed or implied by these statements. These risks, uncertainties and other factors include, among others: risks related to our streaming business; the adverse impact on our advertising revenues as a result of changes in consumer viewership, advertising market conditions generally; changesand deficiencies in the public acceptance of the Company’saudience measurement; risks related to operating in highly competitive industries, including cost increases; our ability to maintain attractive brands and to offer popular content; changes in technologyconsumer behavior, as well as evolving technologies and its effect on competitiondistribution models; the potential for loss of carriage or other reduction in the Company’s markets; changes in the federal communications laws and regulations; the impact of piracy on the Company’s products; the impact of consolidation in the market for the Company’s content;or the impact of negotiations for the distribution of our content; damage to our reputation or brands; risks related to our ongoing investments in new businesses, products, services, technologies and other strategic activities; losses due to asset impairment charges for goodwill, intangible assets, FCC licenses and programming; risks related to environmental, social and governance (ESG) matters; evolving business continuity, cybersecurity, privacy and data protection and similar risks; content infringement; domestic and global political, economic and regulatory factors affecting our businesses generally; the impact of COVID-19 and other pandemics and measures taken in response thereto; liabilities related to discontinued operations and former businesses; the loss of affiliation agreementsexisting or retransmission agreements; the impact of union activity, including possible strikes or work stoppages or the Company’s inability to negotiate favorable terms for contract renewals;hire new key employees or secure creative talent; strikes and other union activity; volatility in the ability to achieve the separationprice of the Company’s radio business through a mergerour common stock; potential conflicts of CBS Radio Inc.interest arising from our ownership structure with a subsidiary of Entercom Communications Corp. (“Entercom”) on the anticipated terms, which are subject to regulatory and Entercom stockholder approvals, an exchange offer and other customary closing conditions, and fluctuations in the market values of Entercom’s Class A common stock and the Company’s Class B Common Stock; other domestic and global economic, business, competitive and/or regulatory factors affecting the Company’s businesses generally;controlling stockholder; and other factors described in our news releases and filings with the Company’s filings made under the securities laws,Securities and Exchange Commission, including among others, those set forth under “Item 1A. Risk Factors” inbut not limited to our most recent Annual Report on Form 10-K for the year ended December 31, 2016 and in our Quarterly Reportsreports on Form 10-Q and in the Company’s recent Current Reports on Form 8-K. There may be additional risks, uncertainties and factors that the Company doeswe do not currently view as material or that are not necessarily known. The forward‑looking statements included in this documentQuarterly Report on Form 10-Q are made only as of the date of this documentreport, and the Company doeswe do not haveundertake any obligation to publicly update any forward‑looking statements to reflect subsequent events or circumstances.

Important Notice
This document is provided for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to sell or the solicitation of an offer to buy any securities. In connection with the separation of CBS Radio Inc. and combination of CBS Radio Inc. with Entercom (the “Transaction”), CBS Corporation filed with the U.S. Securities and Exchange Commission (the “SEC”) a Schedule TO, and CBS Radio Inc. filed with the SEC a registration statement on Form S-4 and Form S-1 containing a prospectus of CBS Radio Inc., in each case, relating to the exchange offer.  Entercom has filed with the SEC a registration statement on Form S-4 relating to the Transaction, containing a prospectus of Entercom, and has also filed a proxy statement. Investors and security holders are urged to read these filings and any amendments or supplements thereto when they become available, as well as any other relevant documents, because they contain important information about CBS Corporation, CBS Radio Inc. and Entercom and the Transaction.  These materials and other documents filed with the SEC may be obtained free of charge at the SEC’s website, www.sec.gov, and at CBS Corporation's corporate website, www.cbscorporation.com.



Management’s Discussion and Analysis of
Results of Operations and Financial Condition (Continued)
(Tabular dollars in millions, except per share amounts)


Item 3.Quantitative and Qualitative Disclosures About Market Risk.
There have been no significant changes to market risk since reported in the Company’sour Annual Report on Form 10-K for the year ended December 31, 2016.2022.
Item 4.Controls and Procedures.
The Company’sOur chief executive officer and chief operatingfinancial officer have concluded that, as of the end of the period covered by this report, the Company’sour disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Securities Exchange Act of 1934, as amended) were effective, based on the evaluation of these controls and procedures required by Rule 13a-15(b) or 15d-15(b) of the Securities Exchange Act of 1934, as amended.


No change in the Company’sour internal control over financial reporting occurred during the Company’sour last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’sour internal control over financial reporting.

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PART II – OTHER INFORMATION
Item 1.Legal Proceedings.
The information set forth in Note 13 to the consolidated financial statements appearing in Item 1 of Part I of this Quarterly Report on Form 10-Q under the caption “Legal Matters” is incorporated by reference herein.
Item 1A.Risk Factors.
There have been no material changes to risk factors previously disclosed in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2022.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.
Company Purchases of Equity Securities
In November 2010, the Companywe announced that itsour Board of Directors approved a program to repurchase $1.5 billion of the Company’sour common stock in open market purchases or other types of transactions (including accelerated stock repurchases or privately negotiated transactions). Since then, various increases totaling $16.4 billion have been approved and announced, including most recently, an increase to the share repurchase program to a total availability of $6.0 billion on July 28, 2016. Below is a summaryDuring the first quarter of CBS Corp.’s purchases of its Class B Common Stock during the three months ended September 30, 20172023, we did not purchase any shares under thisour publicly announced share repurchase program.program, which had remaining authorization of $2.36 billion at March 31, 2023.
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(in millions, except per share amounts)
Total
Number of
Shares
Purchased
 
Average
Price Per
Share
 
Total Number of
Shares Purchased
as Part of Publicly
Announced Programs
 
Remaining
Authorization
July 1, 2017 - July 31, 2017 1.4
  $64.80
  1.4
   $3,214
 
August 1, 2017 - August 31, 2017 1.6
  $65.10
  1.6
   $3,107
 
September 1, 2017 - September 30, 2017 .9
  $58.36
  .9
   $3,057
 
Total 3.9
  $63.52
  3.9
   $3,057
 




Item 6.Exhibits.
Exhibit No.Description of Document
(2(10))Plan of acquisition, reorganization, arrangement, liquidation or succession.Material Contracts
(a)


*
(4)Instruments defining the rights of security holders, including indentures.
(a)(b)

*
(b)(c)

*
(31)
The other instruments defining the rights of holders of the long-term debt securities of CBS Corporation and its subsidiaries are omitted pursuant to section (b)(4)(iii)(A) of Item 601 of Regulation S-K. CBS Corporation hereby agrees to furnish copies of these instruments to the Securities and Exchange Commission upon request.

(10)
Material Contracts
(a)
Employment Agreement dated July 20, 2017 between CBS Corporation and Joseph R. Ianniello (filed herewith).
(b)
Employment Agreement dated July 20, 2017 between CBS Corporation and Lawrence P. Tu (filed herewith).
(c)
Letter Agreement dated August 4, 2017 amending the Employment Agreement dated as of September 29, 2016 between CBS Corporation and Anthony G. Ambrosio (filed herewith).
(d)
Letter Agreement dated August 4, 2017 amending the Employment Agreement dated December 17, 2015 (effective as of July 1, 2016) between CBS Corporation and Gil Schwartz (filed herewith).
(12)
Statement Regarding Computation of Ratios (filed herewith)
(31)Rule 13a-14(a)/15d-14(a) Certifications
(a)
(b)
(32(32))Section 1350 Certifications
(a)
(b)


(101)Interactive Data File
101. INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101. SCH Inline XBRL Taxonomy Extension Schema.
101. CAL Inline XBRL Taxonomy Extension Calculation Linkbase.
101. DEF Inline XBRL Taxonomy Extension Definition Linkbase.
101. LAB Inline XBRL Taxonomy Extension Label Linkbase.
101. PRE Inline XBRL Taxonomy Extension Presentation Linkbase.
(101(104))
Cover Page Interactive Data File
101. INS(formatted as Inline XBRL Instance Document.
101. SCH XBRL Taxonomy Extension Schema.
101. CAL XBRL Taxonomy Extension Calculation Linkbase.
101. DEF XBRL Taxonomy Extension Definition Linkbase.
101. LAB XBRL Taxonomy Extension Label Linkbase.
101. PRE XBRL Taxonomy Extension Presentation Linkbase.and contained in Exhibit 101).


























*Management contract or compensatory plan required to be filed as an exhibit to this form pursuant to Item 15(b).
-51-

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


PARAMOUNT GLOBAL
(Registrant)
Date: May 4, 2023
CBS CORPORATION
(Registrant)
/s/ Naveen Chopra
Date: November 3, 2017/s/ Joseph R. Ianniello
Joseph R. IannielloNaveen Chopra
Executive Vice President,
Chief OperatingFinancial Officer
Date: November 3, 2017May 4, 2023/s/ Lawrence LidingKatherine Gill-Charest
Lawrence LidingKatherine Gill-Charest
Executive Vice President, Controller and
Chief Accounting Officer

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