As he guides the newly merged business, Warner Bros' CEO David Zaslav re-emphasized his intention to take a prudent approach to streaming.
Our goal is to increase long-term shareholder value and asset value, not just subs, he said. We will not overspend to drive subscribers.
Following his earlier affirmation that the company will not "succeed to win the spending wars" in streaming, Netflix, which is spending $20 billion this year on content, is suddenly on the back foot, despite leading the field, due to subscriber losses and new concerns about its business model. is adopting a more moderate approach with its twin services, HBO Max and Discovery+, which will soon be combined in a single offering.
"We are all wide open in the middle lane," Zaslav said in streaming. "People are spending hours a day with Discovery+," and it will soon be combined with the "shock and awe of HBO Max."
Zaslav said the program has a "meaningful burst" than HBO Max has become so powerful, yet it has "nearly become more powerful."
Zaslav explained the company's vision for its May 18 upfront, which will be the new company's coming-out party for advertisers. The company's network, spanning scripted, unscripted, news, sports, and lifestyle, gives it "a unique hand," Zaslav said.
Before the call, Warner Bros Discovery announced results for the first quarter, but only for Discovery, given that the partnership with WarnerMedia did not close until the end of the March 31 quarter. Total revenue increased 13% to $3.16 billion, with advertising revenue in the United States up 5% and distribution revenue increased 11%.
The company's earnings release said the ad revenue came from the "continued monetization of content on our next generation initiatives." Offsetting the upswing was a factor that will stifle the brand's new and its diverse set of legacy assets: "Secular declines in the pay-TV ecosystem and decreased overall ratings."