During the first financial quarter of 2024, media and entertainment giant Warner Bros. Discovery saw its revenue drop 7% (ex-FX) year-on-year, to $9.9 billion, and recorded a net loss of $966 million (down from over $1 billion in Q1 2023).
The Networks segment of WBD, which contains sports broadcasters such as TNT and Eurosport, reflected the wider organization in terms of its Q1 results (unveiled today) - it saw an 8% drop in total revenue, to $5.1 billion, during the three months up to March 31, 2024.
In that segment, distribution revenues decreased by 6% and advertising income by 11%.
Total WBD adjusted EBITDA (earnings before interest, taxation, depreciation, and amortization) now sits at $2.1 billion, with Networks EBITDA amounting to the same total (again, an 8% decrease from figures in Q1 2023).
Networks operating expenses also decreased by 8%, with the allocation of a range of US sports rights to WBD’s direct-to-consumer (DTC) wing one factor behind this fall.
Since Q1 2023, WBD has divested itself of AT&T Sportsnet, a group of four regional sports networks in the US that WBD owned through TNT Sports. The branding was no longer used as of October last year, with the four member networks having either ceased operations or been taken over by other properties since then.
The last month or so has seen an exclusive negotiating period between TNT and basketball's NBA expire, with that top-tier US property now talking with other broadcasters around rights from 2025 onwards. The NBA is currently one of WBD's flagship sporting properties.
Comcast-owned NBC is currently attempting to muscle in on domestic rights, however, as is Amazon.
For the DTC sector, meanwhile, total WBD revenue stayed almost level - $2.46 billion in Q1 as opposed to $2.55 billion the prior year.
That segment includes the Max and Discovery+ streaming services.
Advertising income in that sector rose by 70% (partly attributed to higher US engagement with Max), only to be offset by a 46% decrease in content-related income - falling from $185 million to $99 million.
Distribution income remained steady at $2.18 billion, a 1% increase YoY.
WBD has said the latter decrease was largely caused by fewer international third-party licensing deals being struck.
In terms of subscriber numbers, total figures hit 99.6 million by the end of March, up 2 million from the end of Q4 in 2023. At the end of Q1 2023, meanwhile, these numbers stood at 98.5 million.
EBITDA in the DTC segment rose by 59%, to $86 million.
Q1 saw WBD announce the formation of a joint-venture streaming service that will combine the sports offerings of the Fox Sports channels, Disney’s ESPN set of channels, and TNT Sports, among other platforms.
The service is scheduled to launch in the latter part of 2024, with each of the three joint-venture partners holding a third of the stake each, and having equal representation on the board.
David Zaslav, president and chief executive of WBD, has said: “We are pleased with our progress in the first quarter, as evidenced by strong results in important key performance indicators. We delivered meaningful growth in our streaming business with a nice acceleration in ad sales, generating nearly $90 million in positive EBITDA for the quarter …
“We continue to make bold moves to transform our company for the future as we position ourselves to take full advantage of the opportunities ahead.”
WBD’s 2023 year-end results, published in late February, showed a 4% YoY annual revenue decrease.
The company generated $41.3 billion in revenue in 2023 but made a loss of $3 billion over the same period, primarily driven by $6.9 billion of asset acquisition costs and restructuring expenses.
WBD highlighted the four-year extension of TNT Sports’ domestic English Premier League soccer rights - up to the end of the 2028-29 season - as one of the major highlights of 2023.
