Warner Bros. Discovery Relying On Cash Flow As Hollywood Strike Continues Over 120 Days
Image Source: The Direct
Warner Bros. Discovery has found a new reason to resolve the strikes. According to an SEC filing from the company, Warner Bros. Discovery is set to lose between $300 million and $500 million in revenue due to the work stoppage.
CFO Gunnar Wiedenfels stated, “There’s very little content production going on now. I do think that we’re confident that there will be a solution, and once that happens we’re going to be ready to really get back to a normal production cadence as quickly as possible.” The strikes prevent stars from promoting their projects, leading to a decreased awareness of movies and shows that were completed before the strike but haven’t been released.
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However, not everything is glum for the studio. With no projects to film, they’re spending a lot less on their daily operations. Wiedenfels said, “From a free cash-flow perspective, short-term this is a benefit and we took the guidance north of $5 billion for this year because we’re just unable to deploy capital.”
Image Source: The Drum
Despite the temporary financial benefit, Warner Bros. Discovery is looking forward to resolving the strikes and resuming media production. CEO David Zaslav said he “is spending a lot of time with his peers on trying to resolve it as quickly as possible.” According to the CEO, “Content is the backbone of what we do. We’ve got to get back to work, and we have to find a way to get to a solution that’s fair and makes everybody feel respected and rewarded fairly. That’s the No. 1 priority here.”
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