Warner Bros. Discovery, the parent company of CNN, Warner Bros., HBO and numerous other media properties, has been plagued by weak TV advertising, lower-than-expected revenue, and its stock price has plummeted as investors worry about media. ing. Giant’s financial outlook.
Warner Bros. Discovery stock plunged 12% early Friday, but recovered slightly later in the day. The company announced that TV ad revenue fell 14% in the most recent quarter, a sign that its other basic cable channels remain in dire straits as ratings challenge CNN. ing.
Hollywood’s long-hoped-for recovery in the TV advertising market has not materialized as consumer sentiment remains depressed under the Biden administration, driving unprecedented inflation and devastating household budgets across the country. .
Adding to Hollywood’s economic pain are the tens of millions of Americans who continue to cut the cable cord.
Despite new leadership and a programming overhaul, CNN was unable to reverse its ratings decline. The so-called “most trusted name in news” recently averaged a pitiful 538,000 prime-time viewers, which is lower than cable channels like the History Channel and Hallmark. It’s far behind Fox News and MSNBC.
Like other traditional Hollywood studios, Warner Bros. Discovery is betting on streaming entertainment, going so far as to add CNN for free to its flagship subscription streaming service, Max.
Surprisingly, Max ended 2023 in the black, becoming the first Hollywood legacy streaming service to achieve annual profitability.
CEO David Zaslav has pulled off a coup through relentless cuts, including removing large amounts of content from the service to save costs. The content purge angered TV and movie fans.
He also oversaw layoffs that hit many of the company’s media properties, including HBO and TCM, last year, further infuriating moviegoers.
“This business is not without its challenges,” Zaslav said Friday during the company’s fourth-quarter earnings call. “Amid this, we continue to face continued disruption in the pay TV ecosystem and the impact of a decentralized and linear advertising ecosystem. We challenge leaders to find innovative solutions. I’m looking for it.”
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