(Reuters) - Viacom Inc reported a 14 percent rise in third-quarter revenue on Friday as the media company posted strong advertising and affiliate fees for its television shows and doubled its share repurchase program.
Shares of Viacom jumped 6.3 percent to $79.05.
The company, which owns cable networks MTV, Comedy Central and movie studio Paramount Pictures, expanded its share buyback program to $20 billion from $10 billion.
"The stock is up on the buyback, and their domestic ad growth was very strong," said Brett Harriss, an analyst with Gabelli & Co. "It seems like some of the ratings issues have been addressed, specifically at Nickelodeon."
Ratings at some of its channels, including the children-oriented Nickelodeon, have improved because of new programming. Nickelodeon ratings were up 6 percent in the second quarter, according to Bernstein Research.
Ad revenue in the United States rose 6 percent, compared with a 2 percent gain in the previous quarter.
"The best piece of news in the report was advertising," Bernstein Research analyst Todd Juenger wrote in a note to investors.
Over the past several quarters, Viacom's stable of networks had suffered from poor ratings, which in turn affected advertising. TV ads rates are closely aligned with ratings - the more people who watch a show like SpongeBob SquarePants, the more money the network can get for a commercial.
Affiliate revenues, or the money that Viacom receives to license its TV programs in deals like its agreement with Amazon.com Inc, jumped 28 percent in the United States.
Revenue rose 15 percent at its Paramount Pictures unit to $1.16 billion on strong summer box office films "World War Z" and "Star Trek Into the Darkness."
Operating income from filmed entertainment fell 63 percent to $17 million because of expenses related to marketing and development.
Viacom Chief Executive Philippe Dauman cited improved operations and a stronger U.S. economy as reasons for doubling the buyback.
One analyst on the call questioned whether Viacom would consider going private, given the size of the buyback.
"I focus on the here and now," Dauman answered. "We believe our stock is a great value."
Viacom is controlled by media mogul Sumner Redstone, who serves as chairman of the company and its sister CBS Corp, through National Amusements.
Total revenue was $3.69 billion, compared with analysts' expectations of $3.58 billion, according to Thomson Reuters I/B/E/S. It recorded revenue of $3.24 billion a year ago.
Adjusted for special items including tax benefits, net income rose 24 percent to $635 million, or $1.29 per share, compared with the same quarter a year ago. Analysts expected $1.30 per share.
Editing by Jeffrey Benkoe