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Although Hollywood's film and television writers ratified a new,
three-year contract in September, ending their 148-day work
stoppage, members of the SAG-AFTRA actors union have been on
strike since July, roiling the industry's 2024 film slate and
depriving media companies of new content to sell.
The media company forged by the union of WarnerMedia and
Discovery posted adjusted core earnings of $2.97 billion, above
estimates of $2.92 billion, according to LSEG data. Overall
third-quarter revenue of $9.98 billion was in line with
estimates.
The company reported free cash flow of $2.06 billion, compared
with $1.72 billion in the prior quarter, as it spent less on
production as a result of the strikes. This surpassed
expectations for $1.74 billion, according to Visible Alpha.
The results put the company "on track to meaningfully exceed $5
billion (free cash flow) for the year and contributing to our
nearly $12 billion in debt paydown to date," CEO David Zaslav
said.
Advertising revenue at its networks segment declined 12% to
$1.71 billion as global conflicts and inflation create an
uncertain climate for marketers.
The company's streaming unit posted an adjusted core profit of
$111 million, compared with a loss of $634 million a year ago.
Global average revenue per user in the segment rose 6%.
Warner Bros Discovery had 95.1 million global direct-to-consumer
customers at the end of the quarter, down from 95.8 million in
the previous quarter. In May, it launched its Max streaming
service - combining HBO Max's scripted entertainment with
Discovery's reality shows.
(Reporting by Samrhitha Arunasalam in Bengaluru and Helen Coster
in New York; Editing by Saumyadeb Chakrabarty)
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