Discovery Inc. on Wednesday reported a smaller-than-expected quarterly profit, as the media company ramped up investments in its streaming platform, sending its shares tumbling 8 per cent in early trading in the US.

While Discovery benefited from a recovery in advertising sales on its networks during the quarter, the race to retain paying customers in the crowded streaming market that includes Netflix Inc. and Walt Disney Co’s Disney+ called for higher investments in content.

Discovery’s total costs and expenses jumped 26 per cent to $2.40 billion in the three months ended March 31, 2021 as it bets on unscripted programming in categories including food and home improvement to take on competitors, Reuters reported.

Total paid streaming subscribers globally was at 13 million at the end of the first quarter, primarily driven by its Discovery+ service that was launched on Jan. 4, 2021 the company said.

Discovery said it currently has 15 million paid streaming subscribers.

Net income dipped 62.9 per cent to $140 million, or 21 cents per share, during the quarter, missing Wall Street estimates of 65 cents per share, according to IBES data from Refinitiv.

However, revenue rose 4 per cent to $2.79 billion, edging past Wall Street estimates of $2.78 billion.

In a statement, David Zaslav, President and Chief Executive Officer of Discovery said, “The global rollout of discovery+ is off to a fantastic start by any measure. Key metrics, including subscriber additions, customer engagement, and retention, are exceeding our expectations and demonstrating sustained momentum into the second quarter. We now have 15 million total paying direct-to-consumer subscribers across our global portfolio driven primarily by discovery+, having crossed 13 million total paying direct-to-consumer subscribers at the end of March.

“Our strong direct-to-consumer performance underscores the outstanding value and appeal of our content, brands and personalities to both consumers and distribution partners alike. We continue to expand the reach of discovery+ with recent launches on Comcast Xfinity and Amazon Prime Video Channels. At the same time, we continue to extend our overall engagement with viewers across screens, anchored by another quarter as the most-watched pay-TV portfolio in the U.S. and our seventh consecutive quarter of international share growth.”