How much Warner Bros. content? Has Discovery removed since the WarnerMedia merger just a few months ago? $825 million.
The company revealed in a regulatory filing on Friday that it had written down $825 million on content as a result of the deal. This figure includes a $496 million write-down on content, as well as content development write-offs of $329 million.
“The content write-downs and development cancellations resulted from a global strategic review of content following the merger,” the company wrote in the filing.
The impairment and write-off figures have been broken down into the company’s studio business (which includes film and television studios), its networks business (which includes linear television networks), and its DTC business, which includes streaming services like HBO Max and Discovery+. Content write-downs were for programs that had already been produced or were in production, and development write-offs were for content that was still in development.
And that dramatic figure probably doesn’t include bat girl Where Scoob! : The holiday haunt, two films that until this week were scheduled to debut on the HBO Max streaming platform. (These films will most likely be booked for the next quarter.) This would, however, include an impairment related to the film wonder twinsanother DC project for HBO Max that was in preproduction and was shut down in May, before the end of the second quarter.
The filmmakers of bat girl were informed that the project would not be moving forward anytime soon this month, although it is well into post-production. Company sources have indicated that it plans to hold the film for tax purposes, and the writedowns disclosed on Friday would support that.
The second-quarter writedown likely includes a number of programs that were axed at TBS and TNT, as well as costs related to CNN+, the ill-fated streaming service that WBD shut down just weeks after launch. The filing also noted that the company had $208 million in employee termination costs during the quarter.
TBS and TNT have significantly reduced their programming since the merger, focusing instead on sports and unscripted fare. TBS Cut Comedies Chad (which had already completed the production of its season), Full frontal with Samantha Beeand Tracy Morgan The last OGwhile TNT announced an end date for snowdrops. Scripted development on both networks was halted, and the company elected not to renew its deal to air the SAG Awards.
During the company’s earnings call on Thursday, WBD streaming chief JB Perrette said kids and animated content for linear and streaming movies, direct-streaming movies and shows for TBS and TNT were primarily responsible for content recalibration, “particularly content spending on [Turner] shows that lacked the ability to generate sufficient ratings or further monetization potential. »
WBD, led by CEO David Zaslav and chief financial officer Gunnar Wiedenfels, said it was looking for some $3 billion in cost savings over the next few years related to the merger. Those savings will come in the form of merging technology systems and offices, as well as layoffs, though rethinking how and where it spends money on content is clearly part of the plan as well.
“Having the content that really resonates with people is much more important than just having a lot of content,” Zaslav said during the company’s earnings call on Thursday.
“We will continue to have healthy investments in content, but with the merger of these two content portfolios, we see smart opportunities to do this at a much more measured pace than in previous plans,” Perrette added. “These are tough decisions, but we are committed to being disciplined on a framework that guides our investment in content for maximum return.”