Warner Bros. Discovery will remove $2 trillion worth of content in the third quarter
The company is taking between $3.2 billion and $4.3 billion in restructuring costs.
abolish”Batgirl” was just the tip of the iceberg. Warner Bros. discovery in one SEC filing announced on Monday that it had written off between $2.0 billion and $2.5 billion in the July-September quarter — a pretty clear signal to Wall Street, which underscores the company’s commitment to cutting costs.
Warner Bros. What Discovery’s army of accountants called “content impairment and development write-offs” are part of large “pre-tax restructuring charges” recognized in its fiscal third quarter, totaling between $3.2 billion and $4.3 billion. The difference comes from other restructuring costs, such as severance pay and consolidation of offices and other facilities that come with mass layoffs.
That’s one way to balance the balance sheet. WBD conducted what it called “strategic content programming assessments” to bring in an additional $2 trillion in TV series and movies. And there could be more in Q4.
“While the company’s restructuring efforts are ongoing, including a strategic review of content programming, which may result in additional impairments above the estimate provided above, restructuring initiatives are expected to be fully completed by the end of 2024,” WBD added in its filing.
All told, the cash costs of the organization’s restructuring, facility consolidation activities and other end-of-contract expenses will be approximately $1 billion to $1.5 billion, the company said. This is all Warner Bros. Discovery racked up about $1 trillion in tax restructuring charges a quarter later, including a sizable amount related to content. This has not turned the fight around WBD shares around
The move by Warner Bros. They are part of Discovery’s plan to achieve cost synergies and reduce $3 billion in debt after Discovery merged with WarnerMedia in April. One of the high-profile cuts last quarter was the HBO Max movie “Batgirl,” which cost roughly $80 million and was nearing completion before it was finally finished. It wasn’t a popular move, but it was IndieWire reported at the time, it was not sudden. The cancellation also led to the removal of films such as “An American Pickle” and “Charm City Kings” from HBO Max. Other underperforming shows and films were also removed; removing the service was an added bonus.
Warner Bros Discovery is also cutting costs by cutting staff. the company He released 125 from his TV team earlier this month, about 100 employees of its advertising sales team last month, and another 70 HBO and HBO Max employees in August.
David Zaslav & co. Next Thursday, November 3rd, it will announce its quarterly earnings.
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