Warner Brothers Discovery is (kinda) Screwed
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- čas přidán 6. 03. 2024
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Warner Bros. Discovery's stock price recently tanked to its lowest price ever after their Q4 earnings call with investors. So what's been going wrong since the merger two years ago? And why might they continue to struggle in the new age of digital media?
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TLDR, pleaseeee don't be afraid of doing and showing complicated numbers and topic!! there's a reason why this channel called business and people wanna understand that type of aspect to it!
There's a chain that comes with the TLDR brand which is to keep things short and clear. I don't think it's wrong for them to stay in this niche. It's already much more in depth and nuanced than most video format news.
If you want something deeper you require it from somewhere else imo.
The problem is the whole gimmick of this CZcams channel is about "TLDR"
it's all about it warming about the key points and not the full blown details so don't expect that to happen soon, I think.
Complicated numbers show WBD doing great. And title "Warner Brothers Discovery is (kinda) Good" wouldnt bait so many clicks as this one does.
@@123batina Not particularly. The debt created by the mergers is causing severe issues at the company, and a declining streaming platform isn’t sustainable as its future given the trajectory they’ve shown.
@@elphive42Welp, maybe you see something I dont see in their 10k.
I mean - debt is nasty, I wont argue. But they are handling it pretty well. ~40b left after 55B given? Thats a win in my book.
HBO was literally famous for having good tv content, what do they do with it? call it MAX
The disconnect is so real
It is amazing how they got rid of HBO name, a name widely known for decades even outside the US, and just renamed it "MAX". Same with Twitter. Companies spend tons of money for name recognition and this is what these geniuses do. lmaoo
They also slash their funding for making new content and fire the people who know how to make it
Yeah, I think they would be better served keeping HBO and Discovery as separate services (while using the same infrastructure and just rebranding the same apps/website), and offer them as separate services or as a bundle. I think the failure of a lot of these streaming services is their insistence on bundling everything into a single service. That increases the cost per service on the end consumer, and gets them in the same cable trap where you have to buy access to all of this content you don't want to get the content you do want.
@@evancombs5159 I think that frankly, a lot of these streaming services should not have existed in the first place. I will give you a great example in Paramount+ . They had tried previously with their DC streaming service, then CBS All Access. Paramount + is their 3rd attempt. I think it is business malpractice. CBS/Viacom used to license The CW content of super hero shows to Netflix for over a billion dollars after the entire season had aired on The CW. So, when they started their streaming services, they pulled it off when the contract expired (if they didn't cancel it). Guess how much that billion dollars worth of content made them on their own service. Zero. That's just one example, but there are a lot of media companies that got into streaming before they understood what it was and now we all pay for those mistakes.
Economy 101, very first lesson:
you never change a successful brand name with excellent name recognition!!!
That's an absolute no-brainer and the examples where doing this backfired are countless.
*So why would they do this!?!?*
What's insane about this is that zaslav will collect his big paycheck and move on to bankrupt another company after ruining this one lol.
Unlikely, he has been the CEO of Discovery since 2006, and is currently 64 years old. Most likely he will just retire. The other problem with this statement WB was not exactly doing well prior to the merger. The reason the post merger company is struggling is because it inherited all of the problems from WB.
Yeah dude, you get your information from reels huh 🤣🤣
@@evancombs5159an anology is zaslav got two wrecked ships and instead of repairing them he’s selling sails for scrap while the ones still on are too wrecked to go anywhere.
@@evancombs5159 no. The debt it inherited was WB but from Discovery and At&T, including merger cost.
Capitalism
I agree with someone who said that when a company claims a tax write off by cancelling or removing content from their service that content should then become public domain and royalty free.
If the public pays for the costs, it should belong to the public!
I was also thinking the other day of the logistics of a copyright law that would include provisions for copyright protections to automatically lapse if the media was ever offered for sale, and whoever has the rights doesn't continue to offer the media for purchase at reasonable market rates for X period of time---collectively, even if that period is interrupted by periods where it is offered for purchase. (Meaning, companies that try to practice putting something "in the vault" to artificially inflate its value due to forced scarcity would eventually have to offer it for purchase indefinitely, or lose their copyright altogether.) Perhaps there can be a much shorter but more protective period where copyright lapse would not be on the table, more like how it stands in current law--something similar to the length of a patent, say 20 years. After that, failure to offer for sale would subject the media to possible entry to public domain until a mandatory public domain-ing in a time frame that's the same as current law. (And that last part would be my one concession to corporate business, as I think the period of protection in existence now has become absurdly long, full stop.)
@@AlohaChips I agree, and media is one situation where govt has leverage because so many productions are in receipt of tax credits or some kind of incentive scheme. If you don't make the content available then it is treated as abandonware. Copyright was originally meant to encourage innovation but all it does now is get people to create something and then milk it dry. Also the very companies that fight to extend it abuse public domain all the time.
There is also the issue with WB Games. Last year they had a major hit with Hogwarts Legacy selling over 22M units. This was a single player game with no recurrent micro-transactions.
This year they released Suicide Squad: Kill the Justice league. This is a Game as a Service, with recurrent micro-transitions, and it failed miserably.
So one would expect that WB Games would bet on quality single player games, that sell millions of copies.
But WB management is so incompetent and out of touch with their costumer base, that they now decided to go all in into Games as a Service.
Games as a service would be fine if they had good quality.
It should be fine to have an early access release and just stress test the game and reset everything upon full release. I guess?
@@ayoCC Yes, but the market is already saturated with many Games as a Service.
So for a new GaaS to enter the market and succeed is very difficult, even if it has good quality.
And not to menthion they plan on parting out rooster wholesell not selling an almost 100 million usd anuneal streamer that just prints money...
They do it because, while Hogwart Legacy sells, the profits are not high enough for them.
@@hafirenggayuda But it had much higher profits than Suicide Squad.
WBD has also just announced they'll be shutting down one of New Zealand's two major news broadcasters, which might not mean much to most people, but totally sucks for us
I smell opportunity. Do you smell opportunity?
@@chipcook5346 TLDR AU/NZ, yes please
Why don't you make your own TLDR NZ ?
@@user-ds8rj2vc4v probably because I have -$7 in my chequing account right now
Huh???
AT&T completely fucked them over and walked away with a full wallet. Damn.
No cap. I still remember AT&T being in the news for one of the biggest purchases ever fighting courts and ending it with a massive debt because they didn't even have the funds to buy WB. Now I'm told they got rid of WB not three years later and even went as far as to say "hey you owe us like 40 billion dollars"?!
I inherited 278 shares of WBD stock, after the split with AT&T & sold it at $23.73 a share! Whew!
Not exactly. AT&T made a loss on the acquisition tooo
Boy, do they mess it up?
As of yesterday, WB closed a subsidiary known as Rooster Teeth, ending an era. Twenty one years :'(
That was only a matter of time. IMO, Rooster Teeth has been on a slow downward slide for close to a decade now.
Rooster teeth lasted about 4 years longer than it should have.
I'm sorry but rooster teeth basically died years ago. End of an era for sure but let's be honest about the state of that company
As someone who works with WB... this barely touches the issue. Zaslav hates scripted media and prefers reality tv. So he gutted all of WB's best scripted teams. Between the animation and DC tv shows, the majority of WB's scripted content is gone. All they have left is HBO.
what was the last good WB show that didnt involve HBO?
also those DC shows are still around and still as shit as they have been for years,,,
This is very interesting to watch as a New Zealander, where Warner Bros Discovery recently announced plans to close New Zealand's only commercial news channel (which it recently acquired), which is alarming as it leaves state-run media with a monopoly over news coverage at a time when there are serious questions being raised about its editorial independence from the government.
Basically, this video provides some wider context to a huge local issue.
Is that Sky News? If so, good riddance. That was far more biased than any of the government sponsored channels and its bias was pro-fascist.
They were snapping up loads of media companies during the "free money" period of extremely low interest rates, and as soon as those rates went up even slightly, this bit them in the ass, badly. They're panic-closing seemingly every company they bought, and it's hitting in notable ways here in Canada, too.
State run media will always be far less biased then profit driven media, this is why you have Fox News cnn etc and their atrocious reporting
What's it shutting down ?
@@davidrojas8061WB/D are shutting down Newshub, NZ's biggest non state funded news company.
I think it's very funny that I knew more about the shelved movies "Batgirl" and "Coyote vs. Acme" than I did "Aquaman and the Lost Kingdom" and the remake of "The Color Purple". Warner Bros struggles at making great films and marketing them at the same time, it's very funny to me.
Yep very ironic.
I supposed Batgirl will be the worst movie of all time, despite it will never release.
Not to mention Warner Brothers is now letting movies be sold with expired digital codes and won’t give you a new one. We the people can put any company out of business make them come around real quick. No sales or negative social media can bring them around.
I'll still never understand why they chose to axe the HBO brand on their streaming service. Max just sounds so bland.
CEOs are out of touch with reality. Same reason Twitter got renamed.
The names max and HBO Max are confusing. How does it let people know they own Warner properties.
@@icecreamhero2375 HBO was more famous than Max. You would assume they would have kept HBO
I know, every time I hear it, I have to remind myself it's not Cinemax.
@@the0ne809 Yeah but they have way more than HBO content. What If I am a fan of other things they own and don't know its owned by them. Lets say I'm a cartoon network fan and I didn't know Warner Bros owned CN and CN shows were on Max.
Also, the Dune movies won’t save them. They were mostly financed by Legendary, I think WB only has a 20% stake. Zaslav’s moves in shelving projects, and Max isn’t HBO enough, they’ve alienated a lot of creatives.
Zaslav is happy if HBO disappears and all that is left on Max is reality shows. He's been pushing for reality tv for two decades now
If they continue to stand behind a buffoon like Zaslav, then this is what they deserve. I don't want the company to tank given the IP attached + HBO. However, if it happens, they did it to themselves. One of the single dumbest businessman in all of Hollywood currently.
Wonka was also successful
@@derkleinewalter7911Barbie as well, so without both, they would be in so much trouble.
"Unable to breath under a mountain of debt" - They paid off $15 billion out of £56.3 billion...nearly 27% already! Its on the right path.
Agree, that´s a stupid quote. The debt is fixed at 4,6% and with a maturity average of 15 years. They only need deleverage to 3xebitda and in 18 months they can start to buying back stocks.
It really doesn't help that they keep shuttering studios and brands that I actually like and would pay for on their streaming service, CN Studios and Rooster Teeth primarily. RWBY is exclusively on Crunchyroll and they even sold exclusive streaming rights for Rick and Morty to Hulu/Disney during the season premiere. The decisions are baffling and their catalogue is spread out in a million different places.
I dont think you know what selling rights means
@@davidrojas8061 I very much know what "selling the rights" mean. However if you wish to explain more indepth what it is you believe I don't understand than I'm all ears.
@@maliciousfry for one, WBD hasn't sold streaming rights to Hulu
Selling it means they themselves couldn't distribute the content on their own streaming service
@@davidrojas8061 ok, cool. Now that I know exactly what your problem was let me reiterate: "they even sold exclusive streaming rights for Rick and Morty to Hulu/Disney during the season premiere" Meaning that it was a timed exclusivity agreement. It's something they've done in the past with Rick and Morty specifically before Hulu was bought out by Disney. The first 6 seasons were already on Max in October 2023 and the timed exclusivity was until January 2024 - 3 months. All 10 episodes of season 7 is on Max now but wasn't during the time it aired on Adult Swim.
My point was I would have subscribed to Max to watch Rick and Morty season 7 during the premiere but wouldn't subscribe to Hulu for them.
Perpetual licenses aren't something Discovery has ever done (See: Discovery content being pulled from Sony's PS+ service).
If you have any more questions I'd be more than happy to illuminate. 😊
Yeah CN is being replaced by Adult Swim (and I'm just waiting for the news anydays now) and Rooster Teeth was liquidated, but everyone saw that as soon as Zaslav took over the company.
You completely left out WB Games. I have a family member who works for WBG, and they were the main reason WB didn't go bust during the pandemic. WBG is a money maker at WB.
damn David Zaslav for not releasing and destroying art in favor of taking the tax write off
Though also, the tax system has to take some of the blame for that stupidity.
BatGurl was gonna revive Brendan Fraser career in a major way smh
Zaslav's bonus being based on free cash flow and not business performance makes so many of his bad business decisions make sense. I've been watching him trying to figure out why he seems to be undercutting his own brand so often, but he has no incentive to build a strong brand. He just needs cash in the bank. I think that will really hurt WB Discovery long term.
Lol was just watching another channel where the host said that the huge amount of FCF was a reason to buy and hold long term. He failed to mention the fact that Zaslav is personally benefiting from raising cash flow as fast as possible.
I was in the middle of watching an original series with my friend, and right as we got to season 2 it was pulled from the service and it doesn't exist anywhere else...
I was going to get HBO Max before that happened.
Now with that happening, them shelving completed projects, and restructuring Max to essentially cater to "fluff" content, without the quality control I expected from HBO, I'll gladly go out of my way to avoid giving WBD my money.
Thanks Zaslav!
MAX,thanks but no thanks,i'm not interested anymore,they removed westworld and raised by wolves.
Maybe they'll merge with the Hub and create content that way??
WB were one of the few companies with the IP and content to make a good go of challenging in the streaming industry but have failed at every turn
and so WB is probably going to respond to all of these issues by....doubling down and merging with Paramount.
I read some these a movie Director that wants to buy Paramount Movie Studios, but he he doesn't care about the rest of the business so a merger would make sense
I am flabbergasted on how Zaslav still has his job. He has been the most publically BAD CEO in recent memory. Bob Chapek in Disney was not even half as bad as Zaslav when talking about business decisions, yet Chapek was replaced ASAP, while Zaslav keeps running a company with a century old history in the dirt.
Yeah. I thought his early stunt in cutting movie productions are "necessary evil", where he only do it for tax breaks. But he kept approving bad projects to run, which losing more money.
That because of the board of directors approve the handling David Zaslav been doing with company.
IDK what you are talking about. His one and only task is reducing debt while preserving revenue. Which he is doing perfectly. 14B of debt gone. Give it several several more years and theyll be balling.
6.2B in FCF is what you call running company into the dirt? IDK mate, something got lost in translation there.
@@123batinaYes, but in the meantime they are destroying their reputation with creators and their audience.
@@kyohapookaWho? WBD? Audience? I GUARANTEE you that average burger eating Joe doesnt know what WBD is.
And creators are professionals. Noone cares about "reputation". Show the money and theyll do the job. Corporate america is that simple. Yes.
Anyways - bottom line, Im a WBD shareholder since recently as I discovered it, eh, get it? Discovered...
They said debt is #1 concern and are handling it. Currently they are worth 3x their yearly cash they generate. Undervalued in my book. Should their debt go up in next several years - Id sell them immediately. Until then, I expect atleast 5x the current valuation if they manage to get it down to ~20B in next 5 years.
It's crazy how we're always made to believe "too big to fail" is actually a thing, but eventually they do fail
Some do, some don't. There are companies going back 200+ years. But WB is just braindead.
"Too big to fail" applies predominantly to financial institutions.
they wont. someone will buy them out.
@@ohiasdxfcghbljokasdjhnfvaw4ehr that means they failed
@@unsaltedskies This. Don't know why he's posting this about WBD. They're a media company
Here in New Zealand, one of our TV channels (TV3) is solely owned by Warner Bros / Discovery and the parent company (WBD) just completely killed off its entire news division with 130 jobs gone.
I'm unsure and surprised you didn't add videogames as part of your metrics for 2023. WB games division was bigger and more profitable than their movie/tv division and revenue was up from the previous year. This of course isn't going to be the case in 2024 as it will be disastrous for them, but seemed like the video was a bit incomplete as you skipped on one of their biggest business assets.
I just wanna say, these profitability issues are not unique to WBD. There has been a general slow down in both tv/film/streaming and videogames.
Regarding Max streaming, my family was one of the losses recently. Now, we may come back to it, but not because we really want the Max product they are offering. In fact, we were perfectly content subscribing to Discovery+. The problem is, we really don't need the HBO/Max side of things at a new doubled-price for the combined services - which is why we are not currently subscribers. Sometimes, the bundle isn't as good as the separate pieces!
TimeWarner has got to have a record for having some shitty mergers happen to it
AOL, AT&T now WBDiscovery
😂😂
Don’t forget the Kinney Company, owner of parking lots and cleaning contractors. (Not a joke.)
@@WindupchronicSteve Ross bought National Cleaning Contractors Inc. (the oldest company in New York) and merged into Kinney National Service.
I love Time Warner a lot more.
The way to end inflation is to end the counterfeiting.
Money creation without product creation is inflation.
Make investments to survive.
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Maybe destroying half of your own IP and annihilating the good will of the entire entertainment industry is bad for business, who knew?
A few things:
Cable is still a very profitable business at the momen, structural decline or no.
My understanding is their debt is quite well structured and the interest is very manageable.
Advertising revenue has been affected industry wide by interest rate hikes, may go back to normal down the line.
They have great IP, maybe some of the best in media.
In short, they do have time to turn things around streaming wise.
As a shareholder of wbd stock, i felt like this video was incredibly misinformed. Warner bros discovery only has about $7-8 billion dollars of their debt due before 2027, and over 50% of their debt is due after 2030, at an effective interest rate of about 4.5% which is less than most us government bonds. Warner bros discovery has a credit rating of BBB and the average interest rate for BBB corporate bonds is 5.8%, which means wbd’s debt is considerably cheaper than the average BBB rated company. Their debt is easily manageable with even a fraction of their current free cash flow. So many of the negatives he mentioned are easily explained and cyclical, not structural issues. Streaming is an incredibly profitable business for netflix and max is not profitable yet because they are restructuring and still expanding to international markets while netflix already has. Max is also an incredibly new platform and it takes time to solidify and transfer the old user base. Studios revenue is down because they had a historically strong year prior to this one led by the barbie movie. This is not a sign of a dying studio, but just a manifestation of the cyclical and hit or miss nature of being one of the largest movie studios. The only main point of the video i agreed with was that linear television is in decline and will continue to decline and be a negative towards the overall business.
They are really short on shows with a must see feel to me. I'd pony up for their streaming service if it was something like Doom Patrol or Our Flag Means Death, but I'm not paying for the reality TV that drove me from cable to streaming in the first place.
Absolutely. I agree with you. Max drew me in and got me to subscribe for our flag means death. Then the show was abruptly canceled after season 2. I’ve looked around in their catalog and there’s just nothing that makes me want to keep my subscription. If Max announced tomorrow that they decided to renew OFMD, I would stay with them. Even if it was just for that one show, I would stay.
Westworld really deserves a perfect ending. I wish they will somehow make the final season in future.
Westworld was 1 season. No other seasons were made. The end.
@@fubar12345 Right. Shit went so far off the beaten path nothing they could do in another season could save it
Westworld should have been stopped with season 2.
Season 3 was awesome! Season 2 was bad
Well when you take half your ip catalog off the streaming service to count it as a loss people arent going to want it
HBOmax used to be my favorite streaming service but it is so laden with random crap shows it is hard to find the stuff that is still there that I may want to see. With them selling some of the stuff I do want to see to other streaming services there basically isn't a solid reason at the moment to maintain the sub.
Hardly surprising they dont grow the service given its barely available outside the USA, not sure how you think thats gonna work limiting your potential user base!
Repaying back 20% of debt is huge news. Their stock has declined due to absence of dividends, but WB and Discovery are in the market for long, they are experienced, so I predict in a couple of years a big come back.
Great video, the comments on Free Cash Flow are misleading though. This is a more realistic reflection of profitability of a firm and would be an accurate reflection of shareholder value creation. The more free cash flow you have, sure, the more debt you can pay down, which should be a major priority right now for the company, or pay dividends with. But, it also reflects the excess you have that could be used to reinvest in the business. So tying his bonus to FCF isn’t necessarily a bad thing
He could also use a billion of that cash to double the stock price. thats more than 5% of the outstanding stock and almost a quarter of the stock in the market.
Max is still not availbable in Europe. It is planned for the spring, but who knows.
Just in time for Rooster Teeth getting folded :v
RT has been in steep decline since 2018. The company honestly should have closed in 2020.
@@ironsightsmcgillycudy7753 right! I like Rooster Teeth as much as the next guy but the quality of their cast and shows really took a dive over the past decade.
@@ironsightsmcgillycudy7753while that’s probably true I think that if Warner Bros as a whole was doing a lot better with all their projects doing well, they would’ve tolerated rooster teeth continuing to exist for a couple of more years.
@@feedninjacat3206 Agreed
For me, the Discovery channels added nothing of interest. And since the CEO is from the Discovery side and chopping more content from the Warner side that I might have watched, I finished up the HBO series and Warner movies I wanted to see, then canceled my subscription. I tend to limit the number of subscriptions I have at one time, so it was a convenient excuse to pivot away from "Max" to Hulu when they offered a special rate. I probably won't get back to Max for some while.
Netflix is trash bro they've been making crappy anime reboots to properties they don't own outright
I don't even touch the Discovery slop. I'm all about the HBO, WB, and all of the older film content. There's plenty if older stuff I want to see, and on that count, I think the service has the most movies I want to check out, but it's pretty slim pickings as far as jew scripted content is concerned.
This is why making decisions based solely on earning shareholder's money will always result in a net negative for everything. None of these mergers should have ever happened to begin with. They didn't happen to make their companies or the industry better, they happened so some people could make just a little more money. That's it, the only reason. As long as shareholders can make a crap ton of money, it doesn't matter that they are systematically ruining the entertainment landscape and burning the businesses to the ground.
In Europe, there's still confusion because in some countries, HBO (max) content is sublicensed to Sky while Discovery+ is still a standalone service. Although, as Eurosport still has the rights to the olympics and other European HBO shows have been doing well lately in the not yet saturated European streaming market, I think they could do very well in 2024, in Europe at least.
We have max and skyshowtime in my country, eurosports is on basic cable tv , from my anecdotal evidence everyone that uses streaming has netflix and i bet theres people using maxbut idk who is subscribring to skyshowtime although it´s cheaper only 5 euros/month
Let's not get to the saturation point please, its bad enough already!
Well in Sweden at least, it's still branded as HBO Max and hasn't been polluted by crappy reality content from Discovery+ yet, so it still has some appeal for me.
Max will never ever launch in the UK.
The deal they have with Sky is amazing and worth billions, the max service will never pull in the same amount of numbers needed to beat this deal.
Comcast have a deep wallet.
They also coproduce a lot which confuses things.
@@Jsdo1980 The change from Dsicovery+ and HBO MAX in the Nordics is hapening mid may
One of the most annoying things they’ve done recently, for me at least is they pushed LastWeekTonight’s CZcams release to Thursday. That rubbed me the wrong way
Same. It's also a mistake because that show benefited from the One Two punch of being released consecutively. It gains more traction when at the beginning of the week because people can watch and talk about it at the same time. Still good to see on Thursday, but I wouldn't be see surprised if it loses views.
The should have just deleted the whole thing and canceled the show.
The implosion of the DCU, cancelling ongoing shows and famously not even releasing completed movies is a terrible look for consumers. Why invest in anything WBD relatd if it might simply stop and get rebooted. If it might get cancelled or if it might not even come out. people don't want to start watching entertaniment that potentially doesn't even come out.
Zaslav has all the answers so he claims, but at the end of the day he is responsbile and he is ruining this company. His attitue towards people upset about unreleased shows is terrible. He's like a walking PR nightmare.
The DCU hasn't even started yet.
Three things you hit on or omitted in the first 15 seconds 1) They've Paid down $12B in debt in the last 2 years. 2) I see you left Barbie out of the box office results and Aquaman and Wonka were hardly flops. 3) Their streaming business actual turned a profit last quarter joining Netflix and Hulu (which is having issues of it's own) That's all I needed to see to save twelve and a half minutes of my life watching the rest of it.
The crash and burn policies of the Multimedia companies is far more entertaining than the content they put out
Lol "recent cinematic releases mixed at best " doesnt show Dune.
Or Barbie. It's not for me, but clearly I'm not the target audience. Dune was great, though
Apple just need to buy Warner.
Their TV service is HBO quality and that’s the market they’re aiming for. Buy Warner, keep Warner and HBO, spin off the bits they don’t want, get the brand and IPs as well studio space around the world.
The own Leavesden within the UK which is being massively expanded, apple already film a lot here anyway the same as most other studios because the tax incentives are the best in the world. By 2030 it’s projected more films/tv are going to be filmed here than the US.
They could easily afford to buy it and pay off the debt and reclaim this debt by selling assets and they’d still have billions left in the bank. It’s something I could see happening at some point.
They also had some massive successes with dune 2 and barbie, didnt hear a thing about that
But every other movie they made pretty much flopped hard like the Flash or Aquaman
Warner Brothers tells Disney universal Sony and MGM and Paramount to say don't forget to share folks
You forgot to add Rooster Teeth to the mix of brands, but considering they just announced the closure of the studio, it might either be a mistake or a precognition.
I've taken an amateur interest in economics the past few years, and I've seen a few patterns. One is that the US Supreme Court ruling that businesses have a duty to increase shareholders' value has led to "STONKS!!" being the sole focus for businesses at the expense of literally everything else. This has caused legacy companies to lose all their credibility as they slash corners, cut employee pay and benefits, and shred everything down to save pennies to push stock speculation ever higher - to the sole benefit of the already wealthy shareholders (looking at you, Boeing!) The second observation is that leveraged buyouts were an absolutely terrible idea that overburdened many otherwise successful brands by saddling them with debt they had no way of paying off (like Toys R Us). Third is that private equity firms are evil. They exist to leech all the stock value they possibly can from a business so they can make massive profits as it dies. They're economic vampires. Parasites that survive after the host is dead so that they can move on to another. Fourth is that the system is messed up, it has to change, and it'll get much, much worse before it gets better.
so canceling already finished projects is the same as making money to them... good lord.
No bonuses until the business is doing well.
This has happened to all movie studios. Business bureaucrats get in the way, only think about money and then they forget about what business they’re in which is to entertain and make good content and distribute said content.
They’ve made some great movies and shows but when you are losing money because you’re trying to make a hundred shows at once and hope one sticks isn’t a good strategy.
@drewmorrison True & it is even worse when the bosses force everything to be woke.
I bet it might be a little bit better than these coyote versus acne
🆘 Remember Warner Brothers Discovery lost money last year and shareholders lost over 60% in shareholder value but their CEO David Zaslav’s was paid $50 million. ⚠️WBD/CNN stock on 4/25/24 is now trading at $8.28 near its 52 week low of $8.02. Top analyst said the slide down for WBD stock is not over. Warner Brothers Discovery stock is down 68% in value per share the past 2 years. WBD shareholders have now lost over 68% in value per share the past 2 years because of WBD over $paid$ incompetent leadership. Also CNN fake news is a “dying media company” which is also killing the total Ad Revenue and profits for WBD bottom line. Remember excellence is never an accident. Failure is a result of poor leadership.
Whats the interest rate on the 41 billion usd in 2024 compared to when the business was established. Surely the trust had contingencies for an interest rate increase with a debtloading of this size. 41 billion is country sized GDP.
I kinda stopped subscribing to their service (HBO Max, specifically) when they cancelled everything I was looking forward to seeing.
I thought he said a reverse Boris & Truss, I was thinking, can I never get away from Liz Truss and Boris Johnson
HBO Max had finally delivered on becoming the number one service when a struggling obsolete Discovery came in and took it down to third best. Not only is it a worse platform, they cut down on what made HBO good. It screams of a big business blunder. Discovery isn't known for being a quality brand. It's a relic of an obsolete era. WB should wise up and let HBO run the service. It was a backwards deal and it looks like they're paying for the bad judgement call on management.
I had a “free” sub to max with my old att plan, lost that plan and still had a max account for over a year, I really think they weren’t scraping accounts without payment to keep the numbers up for a while
aren't they spending 2 billion dollars for a Harry Potter TV Series over the next decade?
Great analysis. Thanks for posting this. I'd love for you to break down the financials for other streaming services too.
So sad they are shutting down Rooster Teeth. Please god someone out there buy and finish RWBY
This was a very interesting and informative video report. And that's one of the issues: the 13 minutes I spent watching was time taken away from watching Max.
This man tells us something for 2 minutes and then dos a summary... Bro you told me this 1 minute ago I dont need a flashback already shit got me feeling like im watching naruto
"...Dropped to the lowest price ever". WBD has only existed since 2022.
David Zaslav is the reverse King Midas. He had an empire of gold, but everything he touches turns into shit.
10:45 bleak WB forecast 5:45 streaming can't earn 7:15 subscribers avoid Max
In India, HBO was very well regarded for showing some of the best Hollywood cinema. As a WBD investor myself, I feel the management would've been better off sticking to their strengths...They should have had one major streaming service under the HBO tag. The mix of so many channels, especially MAX(which, ironically, in India would still be recognised as Sony MAX!) just causes lack of brand clarity.
my guess the Discovery side is what is actually weighting the business. HBO and Warner Bros would have ultimately succeeded as a streaming service while Discovery would have not.
Well looks like they're not screwed since their movies are making money now😂
I’m my opinion I think they need to take a few years to come up with a good plan for their future, in the mean while license out as much catalog as they can to 3rd party to make money to pay down their debt.
The thing is Warnerbrothers is doing better than Paramount and WB/Discovery may not be doing that well but they're making progress on a huge problem
Its like there CEO is attempting to commit corporate suicide. He has done so many things to piss off everyone why would anyone want to work for them? Theres Batgirl killed The Coyote film killed and now they are killing an entire wing of games. Working for them is a way for all your work to be erased..
Aren't they eyeing to merge with Paramount, gods, I hope they fail to do so. It'll drag it down and buried under an avalanche leaving us with Disney and Universal left.
I think this is a very good moment to buy, 21 billion net worth is super cheap, i think this year they will execute much much beter my share price target is 20, also payed 56 billion depth to 40 billion.
This is sad. I hope they can turn it around soon. Would proberbly help to swap out the CEO.
last time i was this early, it was suceeding
I'm a Max Subscriber. I would gladly watch more but since Max does not allow you to adjust resolution they can chew through all my allowable data in just a few days.
Great video that I appreciate. I've just subscribed! But your colour correction is making my eyes hurt, lolz. Normal colours would suffice, give it a try
Great analysis. Thank you for the well-done and thoughtful content.
I literally stopped paying for HBO Max when they decided to make a new app for no reason and charge more for removing half the name.
Half of the Networks can kill, just debts after debts. 🤦♀️
And they are closing down Newshub here in New Zealand leaving us with only one tv broadcasting news, which, is state owned
1:32 That's crazy! This is like a woman giving birth to a newborn baby and then wanting the newborn to pay for all of the medical expenses.
Good Breakdown. Very well put together explanation.
It’s crazy how everyone was right about everyone trying to make their own streaming service.
I’m still bullish on the stock long term
Some good points. I think WBD will be fine in the long term, thanks to strong foundations which have already helped it survive bad management decisions like mergers with AOL in the past. AT&T was a bad custodian, and now Zaslav will be the necessary evil to manage the debt. I see him gone in 2 years and more creative CEO taking his place. The streaming market is starting to settle, and now we'll move to a stage of consolidation which I think will play to WBD's strengths.
I feel like WB's death flag was raised when it was bought by a telecommunications company.... who didn't even want them 😂.
I'd say AT&T ownership messed thing up which are now being fixed. Discovery + WB content on max is amazing for the entire fam. Worldwide rollout of max is sure to get growth rolling again.
Even Wonka didn't make a particularly big profit given the additional marketing costs and the fact that they only get to keep about 50% of box office takings.
They just announced the shutdown Rooster Teeth yesterday too. Little sad after watching their content for the last 20 years, but not shocking.
Why did they merge when discovery couldn't afford it? It doesn't make sense to me and feels like a reckless decision.
I've been watching Marketing Mondays. Already informed 👍
Warner Bros. has created the biggest box office hits of 2023 and 2024.
Dune2, Oppenheimer, Barbie.
I can't believe how dubious your analysis of warner bros movies is, just because they don't release in the Christmas season with all the other movies.
Part of Max’s problem is that for some customers they felt it a downgrade from hbo max and discovery+ I had both and while most content from discovery was ported over when it became the one service as Max not all content came also there was content on HBO Max that also vanished after it became Max as well. Add also they raised the cost after the merger too. I kept it cause I enjoy a lot of the content especially from the discovery side of content but i am not as happy with Max as I was with the two former services. I think Wonka has shown them though on movies they don’t have to overpay to get performance. I think we could see more DC on the small screen tv series, and cartoons, get away from the big expensive live action movies that aren’t working for them or for Marvel as they once did.
i feel like wbd especially in their tv and video games sector are doing what they want for long term money, instead of what the fans want which in turn hurts them longterm