The scatter market overall is very slow, I would say, steady to maybe a little bit better than it was in the fourth quarter. There hasn't been a stand-alone Superman movie in a decade. No question about that. And the response from consumers has been overwhelmingly positive. We repaid $1 billion of debt during Q4, bringing the total debt repaid since the closing of the transaction to $7 billion, and we ended the quarter with $49.5 billion gross debt and nearly $4 billion of cash on hand, implying net leverage just below 5x. Just what should we expect in terms of '23 versus '22? There's been an increasing discussion recently about what the right general entertainment content strategy supposed to be for media companies as your models continue to pivot and become more streaming-centric. As always, we are not managing this company for short-term financial performance, but rather with the next 100 years of this vibrant creative organization in mind. We got to take those swings. Adjusted EBITDA decreased 7% as revenue declines were partially offset by lower content expenses as well as lower personnel and marketing costs, in part reflecting our cost synergy efforts. This company every year give up the chance for new talents. The industry was in a quantity of content over quality, we believe, in a quality over quantity and therefore, spend-wise, spend needs to get rationalized. The reality is, in today's environment, I think it would be -- you wouldn't want us to say we have a static a 100% defined windowing strategy. I mean, pot levels in the industry, I think, were down 14% in the quarter. It's about the sustainability and the longevity the free cash flow being delivered by that segment. In the end, there was public backlash over his casting, but not because of his . Discovery, ensuring it will remain as the exclusive Australian home of HBO, Max Originals, Warner Bros. and Discovery programming. And in fact, we're -- we use news and sports quite effectively in Europe, and we've learned a lot about when it does work and when it doesn't. The biggest unknown continues to be in the ad sales environment. More Earnings Resources from MarketBeat Earnings Tools: Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance We've accomplished a significant amount in 2022, and I'd like to take this opportunity to thank the entire finance team for their persistence and resolve in working through these very difficult but necessary first steps, which has resulted in greater command, control and precision across the enterprise and laid the foundation on which we are positioning the company. Gunnar will take you through all of the financials in our outlook, but I'm very pleased that we see our net leverage clearly below 4x by the end of this year, below 4x by the end of this year. Thank you, David. Discovery The move is part of CEO David Zaslav's self-imposed mandate to find $3 billion in synergies between the two companies. You do not need to submit this form if you've already submitted to any casting. More on this from Gunnar in a minute, but I'm pleased with the trend line we see in Q1, particularly as we are managing towards close to breakeven segment EBITDA in the quarter. Thank Sure. A number of your competitors have cut back on the total amount that they're spending on cash content in '23 versus '22. Revenue decreased 6% as global advertising revenues declined 14% and distribution revenues decreased 2%. China said on Monday (local time) it sought dialogue and peace for Ukraine despite US warnings that Beijing might be considering weapons supplies for its ally Russia's bogged-down invasion. And we're curating now in a way that's having an impact on America. The efforts ongoing enterprise-wide are helping to turn the flywheel and grow and improve our businesses, and we see so much opportunity ahead. Required fields are marked *, Warner Bros.-Seven Arts, Inc.(19671970), Toby Emmerich(Chairman, Warner Bros. Pictures Group), Walter Hamada(President, DC-based Film Production), studiofacilities.warnerbros.com/studio-operations-inquiry-form/. Warner Bros Casting Calls are the most useful tools for those who are feeling capable that they can make an immediate impact on their acting careers, but aren't well-enough known to get invited to usual castings. And we are still in the early stages of bringing this comprehensive portfolio together and harnessing all that it can deliver. The poor actors and directors of the . HBO and HBO Max Hit with 70 Layoffs at Warner Bros. Wizarding World is the new official home of Harry Potter & Fantastic Beasts. Warner Bros. If you look at The Last Of Us, it was growing every week, Euphoria, to be able to deliver 20 million, 30 million, 35 million people in America watching and to have it be a conversation. Warner Bros. Discovery's earnings are expected to grow from $0.97 per share to $1.79 per share in the next year, which is a 84.54% increase. Keep one thing in mind, the entire last year was impacted by this headwind from coming off of Amazon. That's not the point. Our final question comes from John Hodulik with UBS. With that, I'll turn it over to Gunnar, and he'll walk you through the financials for the quarter. The Last Of Us, for example, grew its Sunday premier night viewership by about 1 million with each episode over the first 4 weeks. And after just 5 weeks, an astounding 35 million people have watched episode 1. Discovery, Q4 2022 brought a hefty price: A net loss of USD 2.1 billion due to declining ad sales revenue figures. Interestingly, the actor cast as the titular character, Austin Butler, isn't the most well known, and audiences will probably know him best as the Manson family member Tex Watson in Once Upon A Time In Hollywood . Discovery, Inc. Fourth Quarter 2022 Earnings Conference Call. "This promises to be a very exciting year for our company," he told investors during the company's Q4 earnings call . Discovery CEO David Zaslav wants to redeem his predecessors' failure to rival Disney with its library of intellectual property through an unprecedented focus on tentpole events. Please disable your ad-blocker and refresh. August 4, 2022 04:30 PM ET. But in order to do that, we took less volume than we could have. ET Follow HBO Max Go to Site Follow HBO Go to Site Follow Warner Bros. Go to Site Follow HGTV Go to Site Follow Discovery Go to Site Follow discovery+ Go to Site Follow CNN Go to Site Follow TBS Go to Site Follow Food Network Number four, driving overall efficiency and free cash flow conversion towards our near-term goal of 1/3 to 1/2 conversion of adjusted EBITDA with longer-term upside towards our 60% goal. Christian Zilko So I think this is an exciting time because I think we're really -- we made some tough decisions. The studio is the flagship producer of live-action feature films within Warner Bros. Elvis is a 2022 biographical drama film directed by Baz Luhrmann and written by Luhrmann, Sam Bromell, Craig Pearce, and Jeremy Doner.It follows the life of the American rock and roll singer and actor Elvis Presley, told from the perspective of his manager, Colonel Tom Parker.It stars Austin Butler as Presley with Tom Hanks as Parker, while Olivia DeJonge, Helen Thomson, Richard Roxburgh . And the best thing that we have going for us right now is all of that hard work that we did, and it was probably two years of work that we did in 10 months, it's now almost -- it's overwhelmingly behind us. It's not about getting it out for a certain date. And my second question is about this pending relaunch MAX product. Warner Bros. MACON Advertisements RUSH CALL BACKGROUND Casting Notice *Warner Bros FEATURE FILM: "The Color Purple-The Musical' LOCATION: Macon, GA A replay of the call will be available approximately two hours after the completion of the call until August 11, 2022. And having some of that content appear on our platform and sell it nonexclusively to others is very economically beneficial. We'll definitely -- we're definitely planning for revenue improvement. 2023 will be a year of building and off we go. I do believe, as JB said, and we do believe, as a company, that we'll sort of recreate this -- the streaming service, which is ad free, then which -- then there'll be ad-lite. To participate in the Warner Bros. The forward-looking statements include comments regarding the company's future business plans, prospects and financial performance. We continue to be the place creators are choosing to bring their visions to life. We got some of the best creatives in the industry right now focused on those swings. And we hit this year with a full leadership team in place. We've got some tests going on and it's very early, but some of the numbers that are coming in are looking exciting. In today's increasingly dynamic and a crowded media environment, the best hand has great storytelling IP, brilliant creatives, a full slate of production and distribution capabilities, and broad global reach that stretches across premium, pay TV, free-to-air, theatrical, streaming, licensing and gaming, the entirety of the ecosystem, and that is exactly the hand that we have, and we intend to play it decisively and with a focus on free cash flow and an eye towards sustainable future growth. This company every year give up the chance for new talents. In addition to less activity in home entertainment, given the leaner theatrical release schedule in 2022, which was very much a result of deliberate decisions we made about specific titles and overall release dates. We've been hard at work since our last call and look forward to updating you on our progress. And so we'll keep in mind this balance of volume versus price. We have the largest maker and seller of content in the world, and while we've got lots more to do, we are increasingly seeing positive traction and strong proof points. That's what led us to the conclusion that direct to streaming movies were providing really no value to us. The Warner Bros. Television Workshop is the premier program for new writers and. And having all those distribution outlets gives us the optionality to look at what the data shows us and see where we need to lean in further or not. - David Spade, 'Nothing Personal' 2022. Warner Bros. is a global leader in all forms of entertainment, from movie and TV screens to mobile devices, store shelves and beyond. So David, as you said, '22 was a year of really heavy lifting and you had challenges really in every division, whether it was film, advertising, CNN, et cetera -- I mean, macro, et cetera, D2C. He presented that to you and the press about a month ago. And back then, you had to watch the show on Thursday night. We believe that when you have content that is so good that it hits the gist. Discovery, Inc. ( NASDAQ: WBD) Q4 2022 Earnings Conference Call February 23, 2023 4:30 PM ET Company Participants Andrew Slabin - Executive Vice President, Global Investor. This information is only for educational purposes use. We have a lot of points to be very excited about. Given we're still in the first year following the closing of our acquisition, I will discuss the P&L impact on a pro forma ex-FX basis. The game was 1 of the most highly anticipated of 2023. Warner Bros. TV Group chairman Channing Dungey, in a memo to employees, explains cuts that will lead to the loss of 125 positions (including 43 vacant slots) - 26% of the division's total workforce. Discovery. The fourth quarter marked the end of a first and very defining chapter for Warner Bros. Of course, the other stipulations include being "willing and available" to film for the duration of the series which could be as long as 12 weeks and will commence around mid-June to mid-August of 2021. So again, as I said, a similar picture with more diversity. I'd like to ask about advertising trends you're seeing and maybe kind of advance this discussion a bit more. The casting of their teenage incarnations as well as those of Newt and Leta will be sure to intrigue Harry Potter fans, and drive further speculation about the next films story. The gaming business is all consumer product driven. Nowhere is this more important in my view, and it isn't going to happen overnight, and I believe we are on the right path. filming in Atlanta, GA. COVID TEST: TUESDAY JANUARY 10, 2023 FILM (1 DAY BOOKING) - WEDNESDAY JANUARY 11, 2023 RATE: $175/12 (DAILY) + $25 COVID For us, 2023 is a year of building. And on the traditional side, we renewed agreements representing 30% of our U.S. affiliate revenues. Discovery, Inc. Fourth Quarter 2022 Earnings Conference Call. And on the 2023. Sorry, Robert. Well, look, for us, the market right now, our focus is building a best-of-class product and putting all of our content together and so that it's easy to consume and that people are aware of all the different content that we have. The studio is the flagship producer of live-action feature films within Warner Bros. And there's lots more to come including the highly anticipated Mortal Combat 12 and Suicide Squad - Kill The Justice League, games also set for release this year with ambitious launch projections. I'm especially happy about the development in our D2C segment, where we delivered a marked improvement across a number of key operational KPIs leading to a healthy sequential improvement to financial performance. And we were able in the upfront to drive price significantly more than all of our peers. An important reference point for the value of our combined portfolio of networks to our distribution partners. Webcast. Look, I mean on the content spend, Remember, all our strategy changes leading to the content restructuring and write-offs over the course of last year, obviously, that's going to flow through cash as well as we adjust. And now you see a very soft scatter market. Ladies and gentlemen, thank you for standing by, and welcome to Warner Bros. It reminds me of my time at NBC when Thursday Night was must-see TV. We want to tell the best stories, share them with the broadest audience possible, and we do that by working together as 1 team, 1 company. company's most recent annual report on Form 10-K and its reports on Form 10-Q and Form 8-K. with that, I am pleased to turn the call over to David. So we're excited about the fact that we're going to take all of the Discovery content and put it together with the HBO Max content in a much better platform. BURBANK, Calif. Due to the unprecedented global pandemic caused by the novel Coronavirus, Warner Bros. Television's Casting department launched a unique virtual "Actors in Training" initiative this summer designed to connect the Studio with emerging actors who may have had their final year of dramatic training curtailed or negatively impacted It's about telling the best story. They are also looking for actors between 16 and 18 to portray both Gellert Grindelwald and Albus Dumbledore as teenagers. Distribution revenues on the whole were impacted primarily by subscriber declines in the U.S. and lower affiliate rates in certain European countries, while larger contractual rate increases in the U.S. and premium sports packages in Latin America helped to offset part of this impact. Netflix Reality Series Audition 2023 Casting Calls. Passionate about supporting Creatives to develop, produce . We reduced EBITDA losses by $500 million year-over-year to $200 million in Q4, supported by 1.1 million net sub adds in the quarter. So there was 60% that was hardly being viewed. And on the 2023 outlook, look, it's early in the year. And I believe in that, having been in this business for 30 years, I think in order to really drive asset value, you need to drive price. The other point that is front or set up for us is curation. Really trying to understand how much of the ad impact that you're seeing is kind of coming from the macro environment? We've effectively done that now, but we had to take two different sales teams and pull them together. Photo: Kevin Dietsch/Getty Images. If all else fails, take your mother's advice - if it seems too good to be true, it probably is. First for David, as part of the upcoming D2C relaunch, can you just talk a little bit about how you plan to balance protecting the HBO brand while at the same time, leaning on the HBO premium content to help drive the new service going forward? It's 1 of the biggest value creation opportunities for us. And while this is indeed encouraging, we're hesitant to forecast any meaningful near-term revenue improvement. [Operator Instructions] Additionally, please be advised that today's conference call is being recorded. Participants must have the right to work in the United States or Canada. Turning to consolidated results and free cash flow. In recent weeks, we signed new deals with a number of the most prolific and celebrated creatives in the industry, including Greg Berlanti, Baz Luhrmann, M. Night Shyamalan, Akiva Goldsman and Zach Cregger with more to come. December 13, 2021. We've contended with recent share shifts away from our portfolio during the NFL and College Football season and the World Cup. We have a fantastic leadership team moving us forward, everyone rowing in the same direction. Discovery CEO David Zaslav has doubled down on the groundwork being laid out for James Gunn and Peter Safran's DCU plans. Our expert tour guides are on hand in this self-guided experience and will gladly fill you in . No, I was just going to say that as David has said before, I think the industry obviously was at a scale at any cost. As you look out to '23, I think Gunnar kind of touched on some of the potential tailwinds, but it sounds like you're walking away from close to $12 billion in EBITDA to maybe low to mid-$11 billion in EBITDA. Warner Bros. Television Group has more than 110 shows currently in production across our own platforms as well as third-party broadcast, cable and streaming outlets, including Emmy Winners, Ted Lasso and Abbott Elementary. Discovery and sort of the earnings power of the organization? Warner Bros. But the key to this company is, as a storytelling company, we have this diversity. Discovery's Q4 Earnings Call. TM & WBEI. Is that -- it sounds like you guys have, on the one hand, a lot of new programs, a lot of new movies and a lot of new initiatives; but at the same time, pulling some content on the floor. And then on the affiliate side, renewing 30% of your affiliate deals. We are laser-focused on delivering against our high-level strategic, operational and financial targets, and the three pillars that comprise our core principles. Yes, that's one important ingredient. So I think that I'm hyper-focused on this, meeting once a week with the team, but getting our stride as a new working team, and I feel like we're starting to get some momentum on that. And regarding the linear affiliate renewals, as we've said a couple of times that we're very happy with how those discussions went, is a clear testament to the importance and the value that our network portfolio is delivering to our affiliates. These statements are made based on management's current knowledge and assumptions about future events and involve risks and uncertainties that could cause actual results to differ materially from our expectations. Note that merger and integration-related cash costs totaled nearly $150 million in Q4 and nearly $800 million for the year, in addition to a nearly $350 million headwind from securitization and factoring since the closing of the deal in early April. Sure. Before we start, I'd like to remind you that today's conference call will include forward-looking statements that we make pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. And as we think about where we put content, as Casey looked at HBO, we were able to see which content are people spending time watching, what content is really powerful to us in terms of reducing churn. In providing projections and other forward-looking statements, the company disclaims any intent or obligation to update them. So I think we're very well positioned. No, the only thing I would add is from the perspective of cyclical versus secular, there's no doubt. Some of them we may find we need to adjust, but we feel really good about where we are, and we're accelerating forward. Clearly, you still have some macro challenges, but what could go right? 53 min read Participants Andrew T. Slabin; EVP of Global Investor Strategy; Warner Bros. Our next question comes from Michael Morris with Guggenheim Partners. Appreciate all the information you just shared. Or is that something that might fuel that service? Every week, a new episode comes out and by the time the next one airs a week later, tens of millions of people have watched the last episode. However, we remain very enthused about the trend line here, and I have greater and greater confidence in our ability to achieve our long-term segment targets of breakeven in the U.S. in 2024 and $1 billion of profitability in 2025 globally. I saw it and loved it. . In an increasingly challenging environment, we were able to deliver over $3.3 billion of reported free cash flow in 2022, a healthy conversion, notwithstanding significant merger and integration-related expenses. Warner Bros Pictures Casting 2023 Open Call Dates Roles Check here. The product will offer compelling content for every member of the household. Importantly, we successfully completed affiliate renegotiations, which accounted for more than 30% of U.S. distribution revenues and which brought our portfolio together coterminously. Discovery in which we took some pivotal initial steps. And on the potential for the balance sheet, the balance sheet improvement is very encouraging. I think you used it during your script. And then on the cost side, all of the trends are pointing in the right direction. This is in part a function of a successfully executed synergy program and ongoing continuous improvement efforts. In terms of the market itself, it's -- as I've said before, it's not a good environment. Our next question SP1 Comes from Robert Fishman with SVB MoffettNathanson. We work, grow and create world class content in one of the biggest, busiest studio lots in the industry, as well as at countless studios, sets and offices around the globe. And so I think that is key to us in terms of building the long-term strength. Warner Bros. And we have high hopes for all of these metrics after the combined product launches to further improve. Chris Licht and the team are focused on building an asset for the long term across cable and digital that is worthy of that great global brand. So I was hoping you could just give us your most updated thoughts, so we kind of have that framework for assessing the new product when you rolled out on April 12. [Operator Instructions] Our first question comes from Jessica Reif Ehrlich with Bank of America. Discovery, Inc.. The advertising environment in the U.S. remains very . Looking for Pottermore? The decisions we've made and the strategies we've set in motion 10 months ago have created a solid foundation and we're starting to see strong momentum. Some are advertiser-driven. Stay tuned for more to come on this front. Taking a step back here, though, I mean, the reason why -- one of the reasons why we carved out the linear business, the network business is, one, separate segment is to be completely transparent about where those trends are moving. I want to follow up on the streaming discussion. Number three, evaluating capital allocation opportunities with rigor, so that we can both achieve near-term efficiency and enhance long-term asset value and growth. And to that point, I have no doubt that we have years and years of that coming our way. Warner Bros. And we continue to track above our internal plans. We have Channing and her team right now with the #1 or #2 show on almost every platform in America where we're selling to all of our -- to our peers in the business. Discovery advantage. Presentation. Young Sheldon, network TV's #1 comedy. And that is the culture here at Warner Bros. We do see the weekly bookings right now ticking up slightly if you compare January and February with maybe the November, December timeframe, looking a little better; retail, fast food, entertainment, a little better; telecom, small, but coming back; but then you've got other areas like technology is still completely depressed. And curating content so that people can watch it and have a shared experience is a very big piece of the Warner Bros. And I'm not taking anything off the table here, but I just want to be realistic as well about what we're seeing today. Let me start with the second. There have been some media reports a few weeks ago that you were going to actually keep Discovery as a standalone product. I have one for David and then one for J.B. or Gunnar. It's the backbone of what we're doing, and we'll keep investing. International, some areas actually trending up now, others still difficult. But I also think we're very well positioned to grow from here. Yes. Discovery. Consistent with what we told you last August, we are getting ready to launch our combined streaming service here in the U.S. in a few months with Latin America to follow later this year and markets in EMEA and APAC in '24. Use the form below to submit your basics and we'll reach out to you when the next big film casts! That's what we're looking to primarily deliver. So that storytelling IP. David Zaslav Praises CNN Adding More GOP Voices; "Balance Strategy" Is "Important," Warner Bros Discovery Boss Says + Discussion: The Wrap, . Please. We are already seeing a more inclusive range of voices and viewpoints, as demonstrated last month, when over 70 Republicans came on our air during their Congressional speaker election process, a first in a very long time, and we intend to continue advancing on this balanced strategy.
