On Friday, Warner Bros. Discovery declared that it expects to see a profit from its streaming operations in 2023. The firm had previously projected that it would become profitable in 2025.
For Warner Bros. Discovery, this is a pivotal moment. CEO David Zaslav remarked, “We’ve been through some substantial restructurings and reorganized our companies with greater clarity and concentration.
We anticipate a profit in our U.S. direct-to-consumer (DTC) business in 2023, one year earlier than we had projected. We remain confident in our strategy and ability to meet our financial objectives; Weare well-positioned to create free cash flow and deleverage our balance sheet, even in today’s tough marketplace.
A major turning point for a corporation that had to cut expenses after the $43 billion acquisition drastically and was drowning in debt is the approaching route to profitability. In 2022, the business laid off hundreds of workers and reduced content investment by canceling numerous episodes and movies from HBO Max.
In the first quarter, the streaming business produced $50 million in adjusted EBITDA and gained 1.6 million members. After the quarter, there were 97.6 million global subscribers to HBO, HBO Max, and Discovery+ on the direct-to-consumer side, up from 96.1 million in Q4 2022.
The popularity of HBO’s video game adaption of “The Last of Us,” which presently has an average of 32 million viewers for each episode in the United States, contributed to the rise in HBO Max subscribers, as reported by WBD. It has also broken records for HBO Max viewership in Europe and Latin America.
Max, from WBD, will debut on May 23 and combine the catalogs of Discovery+ and HBO Max. The $10.7 billion in quarterly revenue achieved by Warner Bros. Discovery was in line with projections made by industry analysts. However, the corporation also declared a net loss of $1.07 billion.