Warner Bros. Discovery says Hollywood strikes could cost company up to $500M this year
Warner Bros. cuts outlook by as much as $500M citing ongoing Hollywood strikes
Hollywood execs warn of significant strike fallout
Constellation Research CEO Ray Wang and FOX Business’ Kelly O’Grady weigh in on the Hollywood strikes and detail its impact on the economy and streaming production on ‘Cavuto: Coast to Coast.’
Warner Bros. Discovery said Tuesday it expects to take a hit to its full-year profit due to the ongoing Hollywood writer and actor strikes, and that the financial impact could continue through the end of the year.
In a Securities and Exchange Commission (SEC) filing, the entertainment giant cut its outlook, lowering its expected earnings before interest, taxes, depreciation and amortization to between $10.5 billion to $11 billion, which would be a $300 million to $500 million hit. The company said the revision is "predominantly due to the impact of the strikes."
Members of the Writers Guild of America and the Screen Actors Guild walk a picket line outside of Warner Bros Studio in Burbank, California, on July 26, 2023. (VALERIE MACON/AFP via Getty Images / Getty Images)
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WBD | WARNER BROS. DISCOVERY INC. | 10.27 | +0.32 | +3.17% |
Warner Bros. Discover, Inc.
Hollywood's actors and screenwriters are on strike together for the first time in over six decades, after actors joined writers earlier this summer in their monthslong strike against the studios.
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The writers, represented by the Writers Guild of America (WGA), have been on strike since May asking for a guaranteed number of writers per room, increased pay and regulated use of artificial intelligence (AI) in the writing process.
Actors and comedians Tina Fey, center, and Fred Armisen, right, join striking members of the Writers Guild of America on the picket line during a rally outside Silvercup Studios, Tuesday May 9, 2023, in New York. (AP Photo/Bebeto Matthews / AP Newsroom)
Actors, represented by Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) want increased minimum pay rates, increased streaming residuals and guarantees from studio and production companies about how, exactly, AI will be used.
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The strike has impacted the production of film and television series and is expected to cost the industry more than $3 billion in losses.
The Warner Bros. logo outside the Warner Bros Studio lot in Burbank, California, 30th September 2008. (Amy T. Zielinski/Getty Images / Getty Images)
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"While [Warner Bros. Discovery] is hopeful that these strikes will be resolved soon, it cannot predict when the strikes will ultimately end," the SEC filing reads. "With both guilds still on strike today, the Company now assumes the financial impact to [Warner Bros. Discovery] of these strikes will persist through the end of 2023."
The company warned last month that the strikes could hit its bottom line.