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CNN
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The media trade continues to wrestle as customers minimize the wire and advertisers pull again on their spending. Warner Bros. Discovery is not any exception – and although it misplaced far much less cash within the ultimate quarter of 2023 than in the identical interval a yr earlier, its loss was nonetheless wider than anticipated.
The corporate, which owns CNN amongst different media properties, reported a web lack of $400 million, down from the $2.1 billion it misplaced a yr earlier. That introduced its full-year loss to $3.1 billion, simply lower than half of the $7.4 billion it misplaced in 2022. However its lack of 16 cents a share within the quarter was worse than the 10-cent-a-share loss forecast.
Income within the quarter fell 7% in comparison with a yr earlier to $10.3 billion, falling slight in need of forecasts.
Firm executives mentioned they had been happy by success in its continued efforts to deleverage, because it paid $1.2 billion in debt within the quarter, leaving it with $44.2 billion in gross debt. That’s down $12 billion from the time of the merger of Discovery and Warner Media in 2022.
“Backside line, we’re a far more healthy firm now and we’re constructing actual momentum,” CEO David Zaslav informed traders Friday. “And we count on 2024 can be a yr to drive that momentum ahead even additional. That mentioned, this enterprise will not be with out its challenges.” He cited the lack of income from these ending their cable service and the drop in advert income.
Among the many headwinds it faces: promoting income at its community phase fell to $1.9 billion, down 14% from a yr earlier, excluding the affect of forex change charges, whereas income from subscriber charges fell 3% on that foundation to $2.8 billion. The community phase nonetheless produced working earnings of $2.2 billion, however that was down 11%.
Its streaming providers posted a 3% gross sales enhance, however that unit posted an working lack of $55 million. That was additionally an enchancment from the $217 million loss it reported a yr earlier, but it surely was the worst efficiency since then, because the unit produced an working revenue within the first and third quarters, and close to break-even ends in the second quarter.
Zaslav blamed a part of the issue on its new Max streaming service not having among the new content material it wanted to draw viewers because of the strikes by writers and actors final yr that shut down a lot of manufacturing for almost six months.
“We’re excited to be refreshing and reigniting our content material pipeline at Max,” he mentioned. “The actual fact is the strikes actually slowed down manufacturing, and we didn’t have as a lot content material as we needed for Max. And we’re now transferring ahead with an incredible slate.”
World subscribers of 97.7 million had been up 2% from the third quarter, and 1% from a yr earlier. It posted these positive factors regardless of a home streaming subscribers slipping to 52 million, down 1% in comparison with the third quarter, and down 5% in comparison with a yr earlier.
Shares of Warner Bros. Discovery fell about 12% in morning buying and selling after the report. Together with that decline, shares are down greater than 25% thus far this yr, and 46% during the last 12 months.
This story has been up to date with extra particulars and context.