An impairment charge, stemming from a reassessment of the assets’ value since the merger of WarnerMedia and Discovery, contributed to a $10 billion net loss for the quarter.
Warner Bros. Discovery said Wednesday it wrote down the value of its TV assets due to the uncertainty of fees from cable and satellite distributors and sports rights renewals, sending its shares down nearly 10% in extended trading.
Content revenue in Warner Bros Discovery’s studio segment fell 6%, as the game “Suicide Squad: Kill the Justice League,” released earlier this year underperformed, compared to last year’s top game “Hogwarts Legacy.” Revenue from advertisements on its direct-to-consumer platforms nearly doubled to $240 million, trouncing Wall Street expectations, due to higher engagement on the Max streaming platform and strong subscriber growth, the company said.Still, the company’s direct-to-consumer customer base grew thanks to its cheaper ad-supported offerings and expansion of the Max streaming service to new markets.
The media giant reported revenue of $9.71 billion in the second quarter on Wednesday, compared to analysts’ estimate of $10.07 billion.
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