Technology
Wednesday, September 6th, 2023 4:19 pm EDT
The media industry is in a transitional moment — from streaming to traditional TV — and the focus needs to be on ending the writers and actors’ strikes, Warner Bros. Discovery CEO David Zaslav said on Wednesday.
“We’re a content company. We’re a storytelling company. And we need to do everything we can to get people back to work,” Zaslav said Wednesday at Goldman Sachs’ Communacopia and Technology conference. “People need to be fairly compensated.”
“We really have to focus as an industry, and we are, on trying to get this resolved in a way that’s really fair.”
The comments came a day after Warner Bros. Discovery alerted investors that it revised its full-year outlook factoring in the impact of the ongoing actors and writers strike if they were to continue through the end of this year. Initially, the company’s guidance was based on the assumption the strikes would be over in September.
The company now expects its adjusted earnings before interest, taxes, depreciation and amortization will take a hit of $300 million to $500 million, putting it in the full-year range of $10.5 billion to $11 billion.
Zaslav has been part of the discussions with the Members of the Writers Guild of America union, which has been on strike for more than 100 days, and the actors, who started their strike in July.
The work stoppage has halted production on Hollywood sets, impacting companies like Warner Bros. Discovery, which owns a TV and movie studio, as well as the biggest portfolio of pay-TV networks.
On Wednesday, Zaslav spoke about the various issues facing the industry as a whole — from the strikes to theaters still feeling the effects of the pandemic, to the tough advertising market and bulking up the streaming business.
The company has been focused on increasing its free cash flow and paying down its debt, much of which stems from the 2022 merger of Warner Bros. and Discovery. The impact of the strikes isn’t expected to affect its debt paydown and net leverage target for the year.
Warner ended the second quarter with $47.8 billion in debt. In recent months the company has done two tender offers, both vehicles for paying down its debt.
On Wednesday, Zaslav said that remains the focus of the company as it has made decisions to cut back on costs, adding there are no plans to “jeopardize” the health of the company for any one piece of content.
Warner Bros. Discovery recently started discussions with the NBA regarding the upcoming rights renewal, he said Wednesday.
Still, like its peers, Warner Bros. Discovery has been looking for ways to bulk up Max, the flagship streaming service that was relaunched earlier this year.
Zaslav said the company would have updates in coming weeks on adding sports to Max. CNBC previously reported the company is targeting the beginning of Major League Baseball playoffs to debut a sports tier on Max.
This month Max is adding more content from both Warner Bros. Discovery’s portfolio and other media companies.
At the beginning of September, Max added more than 200 episodes of series from AMC Networks, which will be available in a designated hub — free to Max subscribers — for the next two months.
Later this month, CNN will join the Max platform as a 24/7 live news hub featuring top anchors from the pay-TV network.
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