The actors’ and writers’ strike continuing to cripple Hollywood has led to Warner Bros Discovery saving in the “low $100 million range” in three months.
Executives reported their spending has plummeted during the second financial quarter of the year as they revealed their earnings on Thursday. (03.08.23)
Negotiations are still to resume between the unions and the studios, but WBD – whose stable includes its flagship Warner Bros film studio, as well as HBO and CNN Global – says it is currently projecting an “early September” end to the strikes and return to TV and film production.
Variety reported Gunnar Wiedenfels – chief financial officer of Warner Bros Discovery (WBD) – revealed on a call with financial analysts about the company’s results from 1 April to 30 June that “uncertainty” among studios as a result of the strikes “may have implications for the timing and performance of the remainder of the film slate, as well as our ability to produce and deliver content”.
He added: “While we are hoping for a fast resolution, our modelling assumes a return to work date in early September.
“Should the strikes run through the end of the year, I would expect several $100 million upside to our free cash flow guidance and some incremental downside for adjusted EBITDA (earnings before interest, taxes, depreciation, and amortisation.)”
Only Writers Guild of America (WGA) members were on strike during WBD’s second financial quarter, but TV and film productions were already severely impacted by their work stoppage.
Variety also reported WBD’s CEO David Zaslav said on the firm’s call with financial analysts about the strike’s impact on its second quarter: “We’re in the business of storytelling. Our goal is to tell great stories, stories with the power to entertain and, when we’re at our best, inspire with stories that come to life on screens big and small.
“We cannot do any of that without the entirety of the creative community, the great creative community. Without the writers, directors, editors, producers, actors, the whole below-the-line crew. Our job is to enable and empower them to do their best work.
“We’re hopeful that all sides will get back to the negotiating room soon and that these strikes get resolved in a way that the writers and actors feel they are fairly compensated and their efforts and contributions are fully valued.”
The WGA has been on strike since 2 May after failing to reach a new contract with the Alliance of Motion Picture and Television Producers (AMPTP.)
And the Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) joined them on 14 July after also failing to ink a new agreement with the AMPTP.
Mr Zaslav added: “It’s critically important that everybody, the writers, the directors, the actors and producers… everyone needs to be fairly compensated and they need to feel valued and feel that they’re fairly compensated in order to do their best work.
“And we have to focus on getting that done. I’m hopeful that it’s going to happen soon. I think all of us in this business are very keen to figure out a solution as quickly as possible.
“We are in some uncharted waters, in terms of the world as it is today and measuring it all. And so I think, in good faith, we all got to fight to get this resolved. And it needs to be resolved in a way that the creative community feels fairly compensated and fully valued.”
Writers and actors are demanding studios raise pay rates and residuals for streaming content and develop guidelines around the use of AI in TV and film.