Warner Bros. Discovery continues to reveal massive restructuring costs as a result of the costly Discovery Inc. merger with WarnerMedia — a plan for a major writedown of between $2.0 billion and $2.5 billion in content and development costs for the third-quarter period.
Overall, it expects up to $4.3 billion in restructuring charges tied to its WarnerMedia acquisition: In addition to the $2 billion to 2.5 billion in writedowns, the value of its content and development, $800 million to $1.1 billion in restructuring costs around organizational staff reductions, and $400 to $700 million in facility consolidation activities.
It had already reported $1 billion in restructuring in the second quarter, and an expected additional $1.3 billion to $1.6 billion in the third quarter. All restructuring is expected to be completed by 2024.
David Zaslav, chief executive officer Warner Bros. Discovery, had talked up $3 billion in synergistic savings by combining the two companies, which completed their $43 billion merger last fall.
Warner Bros. Discovery was pushed down at Monday’s close by 2.3% to $13.18.
All this comes after a string of news that includes canceling some high-profile movies and ending long-running TV shows —
this amidst major layoffs.
All this comes after a string of news that includes canceling some high-profile movies and ending long-running TV shows — this amidst major layoffs.
Earlier this month, the company’s television studio cut 26% of its headcount — 125 staffers — after 14% (70 jobs) of HBO Max employees were let go.
In one recent, dramatic move, Warner Bros. Discovery will be removing library programming from HBO Max, all this as budding competitive streaming services from legacy TV network-based companies are heading in the other direction, adding content to platforms.
One notable theatrical film, “Batgirl,” was canceled. On the TV side, longtime late night TBS show “Full Frontal with Samantha Bee” was stopped after seven years of operation.
Another expected announced saving will come with a merger of high-profile streaming services — Discovery+ and HBO Max.