Warner Bros. Discovery reported a strong second quarter with $9.8 billion in revenue, driven by a 55% increase in studio earnings from hits like Minecraft and Sinners, and added 3.4 million streaming subscribers, despite challenges in linear TV. The company plans to release numerous new films and focus on content differentiation, while preparing to split into two entities, Warner Bros. and Discovery.
Despite the success of Barbie, which became Warner Bros.' highest-grossing film of all time, Warner Bros. Discovery continues to struggle with financial losses and a decline in streaming subscribers. The company's debt from its recent merger and a 12% decline in advertising revenue contributed to the challenges. While streaming revenue saw some growth, the total number of subscribers decreased by 700,000. The decline may be attributed to the consolidation of content from Discovery+ into the rebranded streaming service Max. Warner Bros. Discovery is focusing on building new products for streamers while managing the decline of its cable networks.
AMC Networks reported an 18% drop in third-quarter U.S. advertising revenue, but saw growth in streaming subscribers after two quarters of decline. The company lowered its full-year revenue target due to softness in content licensing revenues and a difficult advertising environment. AMC Networks also completed a restructuring plan to achieve cost reductions and launched an ad-supported version of AMC+. The company's CEO highlighted their focus on high-quality programming, strong partnerships, and profitability, and expressed interest in future collaborations with other programmers. Despite the challenges, AMC Networks remains committed to managing the business responsibly and leveraging their core strengths to reach viewers across platforms.
Shares in Warner Bros Discovery fell by just under 6 percent after the company unveiled Max, its refreshed streaming service that combines programming from both HBO Max and Discovery+. The newly-combined streamer aims to better compete against Netflix and Disney+ in the online video arena. Warner Bros Discovery hopes that shares will rebound when investors digest new programming for the Max service, which includes Harry Potter and The Conjuring TV shows, a new Game of Thrones spinoff, and a new Big Bang Theory spinoff. The company has 96.1 million streaming subscribers across HBO, HBO Max, and Discovery+.
