The Warner Discovery call is now in the Q&A section. The biggest takeways so far are that HBO Max will not disappear, as I reported yesterday. HBO Max and Discovery Plus will be combined, however. On the subject of “Batgirl,” David Zaslav said: “Our job is to protect the DC brand.” He said the focus is on quality. we won’t release a movie unless it’s ready.” He added: DC is something we can make better.” Warner Discovery will turn DC into a studio a la Marvel with a 10 year plan.
Zaslav praised the HBO team, calling Casey Bloys a “unicorn.” He emphasized: “We embrace and support HBO Max…HBO Max is the centerpiece of our streaming platform.”
But clearly “Batgirl” fell short not just as too big vs too small but just not good. It’s rare when a studio looks at a finished product and admits failure. I wish they did it more often!
There was no discussion of layoffs, as feared. But that doesn’t mean there won’t be any…
The fun begins at 4:30pm Eastern. Warner Discovery stock closed slightly up today at $17.48 which is nice but well below its high of $31 a year ago. David Zaslav and Discovery bought WarnerMedia from ATT , the deal closed April 8, 2022. We are far from the halcyon days of Time Warner when content was king, HBO was the crown jewel, CNN was revered, and so on. We’re new territory here.
Earlier: HBO Max Rebranding Not Happening
UPDATING David Zaslav comments:
The big question — will HBO Max disappear? As I reported yesterday
“We will fully embrace theatrical.”
Streaming: HBO Max and Discovery Plus under one entity
Ad supported streaming for non subscribers
Operate as one company with one mission. Combined enterprise. HBO, WB, et al we are stronger together.
“House of Dragons” biggest campaign in our history.
JB Perrette took over the call.
Over paying and over investing in content– we don’t believe in this.
Focus is consumer choice.
Combining SVOD with ad lite and ad free.
Ad free and ad lite: Combination of HBO Max and Discovery Plus. They are distinct in their appeal. The two services are different.
Discovery Plus adds CNN hub. HBO Max will begin hosting Magnolia Content from Joanna and Chip Gaines.
Financial Summary & Operational Highlights:
Q2 total reported revenues were $9,827 million. Pro forma combined revenues decreased 1% ex-FX compared to the prior year quarter.
Net loss available to Warner Bros. Discovery, Inc. was $(3,418) million, and includes $2,004 million of amortization of intangibles, $1,033 million of restructuring and other charges, and $983 million of transaction and integration expenses.
Total reported Adjusted EBITDA was $1,664 million. Pro forma combined Adjusted EBITDA decreased 31% ex-FX compared to the prior year quarter.
Cash provided by operating activities increased to $1,011 million and reported free cash flow increased to $789 million.
Ended Q2 with $3,896 million of cash on hand, gross debt of $53.0 billion, and net leverage of 5.0x.
Ended Q2 with 92.1 million global DTC subscribers, an increase of 1.7 million versus 90.4 million subscribers at the end of Q1, as adjusted for the Company’s new DTC subscriber definition. The new definition resulted in the exclusion of 10 million legacy Discovery non-core subscribers and unactivated AT&T mobility subscribers from the Q1 subscriber count.
Warner Bros. Discovery was the #1 TV portfolio for total time spent by viewers in the U.S., TNT was the #1 TV network overall for Men 18-49 & 18-34, driven by sports, and TLC was the #1 cable network in the industry, ex-sports, in Primetime for Women 25-54.
Re-extended our agreement with AT&T to continue to offer its internet and mobility customers access to HBO Max’s portfolio of original programming and series.