What happened

Shares of ViacomCBS (NASDAQ: VIAC) climbed 23.2% in April, according to data from S&P Global Market Intelligence. The stock climbed in conjunction with the broader market for most of the month, but got a boost during its final week when the media company started making moves to reduce its employee count.

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ViacomCBS stock sank 40.6% in March as coronavirus-related concerns prompted a near-across-the-board market selloff, and the partial recovery of the broader market likewise helped the company regain ground in April. The other major positive catalyst for the stock appears to have been a letter sent by CEO Bob Bakish to employees discussing cost-cutting measures and alluding to layoffs. 

Captain Picard and Admiral Riker from ViacomCBS's show 'Picard.'

Image source: ViacomCBS.

So what

Bakish addressed a note to ViacomCBS employees on April 29, discussing streamlining initiatives and cost-cutting measures. 

The performance of ViacomCBS's core television networks has suffered in recent years due to the growth of cord-cutting, and its efforts in the streaming space have been slow to produce their desired results. The novel coronavirus pandemic, which led to the cancellation of sports events and effectively shuttered film and television production, has only increased the pressure on the company and increased its need to cut costs. Investors in April seemed pleased to learn that the company is moving ahead with its plan to find $750 million in cost savings over the next three years.

Now what

ViacomCBS stock has been volatile in May, but resumed its climb thanks to better-than-expected earnings results. The company's share price is up roughly 5% in the month.

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ViacomCBS reported first-quarter results on May 7 topped the market's expectations. The stock also got a boost an announcement the same day that the company had expanded its partnership with Alphabet's YouTube platform. As per the new deal, YouTube will carry 14 new ViacomCBS channels.

Sales for the first quarter fell 6% year over year to $6.67 billion, and non-GAAP (adjusted) earnings per share fell 23% year over year to $1.13. The analysts' average estimates had been for sales of $6.67 billion and adjusted earnings of $0.94 per share.

Viacom trades at roughly 4.8 times the analysts' average target for this year's earnings.