Warner Bros. Discovery published disappointing results of the first quarter despite the growth in the transmission.
But the action increased on Thursday to renewed speculation that the company will turn its sliding cable channels.
At the end of last year, the discovery of Warner Bros. of Entertainment Warner Bros. led by David Zaslav divided his business into two divisions to separate his problematic but still profitable matter from the cable channels.
A division is anchored by its Burbank, HBO and Transmission Film and Television studies. The second contains the large stable of the company's cable networks, which include CNN, Cartoon Network, HGTV and TLC.
On Thursday, the company's shares opened the financial results, but increased 5% after CNBC reported that the company can throw its cable channels. His shares closed at $ 9.01.
Traditional entertainment companies, including Warner Bros. Discovery and Paramount Global, have had problems in the recognition of investors that younger consumers have little interest in cable television, which for a long time has provided a firm financial base for television companies.
The problem is particularly acute to Zaslav, who has spent almost a decade increasing its portfolio with expensive acquisitions that added more channels.
Wall Street wants companies to stop again. The nbcuniversal competitor plans to turn its cable channels, including CNBC, MSNBC, USA and Golf Channel, this year in a new company that quotes on the stock market called Versant.
In the earning call, Zaslav refused to say if a spin -off in his company was in process.
“We can move quickly if we decide to change,” Zaslav said.
The company registered a net loss of $ 453 million, which stressed continuous struggles in key business units, including lower television advertising in its cable channels.
The company lost 18 cents per action on an adjusted base, which was worse than analysts expected. Even so, the result was an improvement with respect to the first quarter of last year, when Warner Bros. Discovery lost almost $ 1 billion.
The company generated $ 8.98 billion in revenues in the most recent quarter, the estimates of missing analysts of $ 9.61 billion.
During the first quarter, cable channel revenues decreased 7% to $ 4.8 billion.
The company added 5.3 million transmission subscribers during the first quarter, which had the third season of the HBO resort murder series “The White Lotus” and the Max Hospital “The Pitt” drama.
The transmission unit, which includes the HBO linear channel, now has 122 million customers. The transmission revenues grew 8% to almost $ 2.7 billion in the quarter, and their tight profits reached $ 339 million, compared to $ 86 million in the most annual period.
“Our commitment to the narration of high quality stories … remains the engine that drives the discovery of Warner Bros.,” Zaslav told analysts.
The company's bubank film study did not coincide with the success of the “Dune: Part two” last year. His great launch for the quarter, the science fiction film by Bong Joon Ho “Mickey 17”, starring Robert Pattinson, fought to reach the equilibrium point.
“Mickey 17” had a reported budget of $ 118 million, and the study spent millions more on marketing. World sales sales reached $ 132 million.
Study revenues, which include television and video game production, fell 18% to $ 2.3 billion in the first quarter.
At the beginning of this spring, there were reports that Zaslav was impatient with his leadership team of film studios.
But the study began its second quarter with an explosion: “A Minecraft movie”, a box office success that has exceeded $ 875 million in sales of global tickets. Ryan Coogler's “sinners” followed and approaches the $ 250 million brand.
“We are going to have an absolutely surprising quarter,” said analysts of the financial director Gunnar Wiedenfels.
Since Zaslav and his Discovery team took over Warner's businesses three years ago, the company has turned its strategy sharply.
The previous owner AT&T spent billions to launch HBO Max in an attempt to rely on HBO's reputation for high quality. Zaslav's team left HBO from the title in an attempt to attract a broader audience.
Executives cut the programming and instituted multiple rounds of personnel cuts.
The programmers ordered series with a broad base attraction such as “The Pitt”, which has been a great performance for Max.
The company refused to spend big to retain the National Basketball Association, so it will lose those rights to its TNT channel this fall.
“In the end, sport is a rental business,” said Zaslav. “We don't want to flood the area … it's about reaping our [intellectual property]. ”
Now, Zaslav said, the company focuses on producing less content. He hopes to return to an era in which the company was known for its High quality movies and shows of HBO and Warner Bros.
Last year, the Zaslav compensation package increased to $ 52 million despite the rock year for your company.
