Paramount Global (PARA) reported second quarter earnings after the bell on Monday that beat estimates as the company continues to climb back from advertising headwinds and heightened streaming losses.

Paramount reported a direct-to-consumer loss of $424 million in the second quarter compared to a loss of $445 million in the prior-year period and a loss of $511 million in the first quarter. The company has said streaming losses will peak this year after losses totaled $1.82 billion in 2022.

Shares climbed as much as 7% in after-hours trading immediately following the results, fueled by the narrower streaming loss.

The difficult TV ad market, however, continued to be a headwind with linear ad revenue slumping 10% year-over-year, worse than the 8% drop expected but a slight improvement compared to the 11% drop in the first quarter. Management has maintained that the second half of the year will see improvements in the ad market.

Notably, Paramount announced that it has sold Simon & Schuster to investment firm KKR after the publishing giant's sale to Penguin Random House collapsed late last year. The deal is valued at $1.62 billion.

Paramount reported second-quarter revenue of $7.62 billion, higher than analyst estimates of $7.43 billion but down compared to the year-earlier period when revenue hit $7.8 billion. The company reported an operating loss of $250 million versus profits of $819 million in Q2 2022.

Similar to revenue, adjusted earnings also beat estimates in the quarter to hit $0.10 a share, but was still down compared to the $0.64 a share the company reported a year ago.

The company has guided to a return to positive free cash flow and earnings growth in 2024. That should be aided by the recent price hikes of its streaming tiers following the integration of Showtime with Paramount+, layoffs, business restructurings, and a dividend cut last quarter that initially sent shares plummeting nearly 30%.

Paramount launched its Paramount+ with Showtime offering on June 27 at a price point of $11.99 a month. The new offering, which the company described as its "cornerstone" service, is available alongside the ad-supported Paramount+ Essential plan and the free ad-supported service Pluto TV.

As a result of the merger of the two streaming services, the company took a content impairment charge of $1.67 billion in the first quarter but said it expects $700 million in future annual expense savings.

Still, the integration hurt subscriber net additions with the company adding just 700,000 Paramount+ subscribers in the second quarter compared to 3.7 million in Q2 2022.