S&P pares Paramount Global

S&P said it lowered its ratings on Paramount Global and its senior unsecured debt to BBB- from BBB and its junior subordinated debt to BB from BB+.

“The downgrade reflects our expectation that Paramount's leverage will remain above our 3x downgrade threshold beyond 2024. The company's S&P Global Ratings-adjusted leverage was 4.4x as of Dec. 31, 2022, which is well above our 3x downgrade threshold for the BBB rating. We expect Paramount's leverage will remain elevated beyond 2024 due to higher than previously forecast losses in its DTC segment, a sluggish advertising market, and worsening linear TV subscriber losses,” S&P said in a press release.

Furthermore, the agency warned it now sees Paramount’s free operating cash flow to be negative in 2023.

The outlook is stable.

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