By Benjamin Chiou
Date: Thursday 08 Aug 2024
(Sharecast News) - Shares in Warner Bros. Discovery tanked in New York on Thursday after the entertainment company missed estimates with its second-quarter results and booked a $9.1bn impairment charge from its Networks division.
The stock was down nearly 12% at $6.80 by 0957 in New York, having touched a low of $6.73 earlier on - a record low since the merger of WarnerMedia and Discovery Inc in April 2022.
The company reported a net loss of $10bn for the second quarter, compared with a loss of $1.24bn the year before. Losses per share increased to $4.07 from $0.51, missing the $0.27 loss expected by the market.
The $9.1bn non-cash goodwill impairment charge related to the difference between market capitalisation and book value, continued "softness" in the US linear advertising market, and uncertainty related to affiliate and sports rights renewals, including the NBA, Warner Discovery said.
The company's TNT channel has been unable to compete to secure the rights for the upcoming NBA seasons, after Amazon, Disney and NBC signed deals with the basketball league to host games for the next 11 years.
Warner Discovery said its bottom line was also weighed down by $2.1bn in pre-tax acquisition-related amortisation of intangibles, content fair value step-up, and restructuring expenses.
On an adjusted basis, which excludes these one-off costs, EBITDA still fell 15% at constant currencies to $1.8bn.
Total revenues for the second quarter were down 5% at constant currency at $9.7bn, missing the $10.1bn expected by analysts.
Nevertheless, president and chief executive David Zaslav said he was "extremely pleased" with the results and the "growing momentum" the company is seeing, with 3.6m net adds, bringing total direct-to-consumer subscribers to 103.3m.
Email this article to a friend
or share it with one of these popular networks:
You are here: news