Warner Bros. Discovery released its financial report for 2023 and it was largely mum-to-bad news.
But that report did include one bit of good news — and it turned out to be a historical bit of good news.
In short, Warner Bros. Discovery’s flagship streaming platform, Max, helped turn a modest profit.
(WBD describes its streaming service as “Direct-to-Consumer”.)
And as The Hollywood Reporter points out, even a modest profit is historic because WBD became the “first Hollywood conglomerate to turn a profit for its streaming unit for a full year.”
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Presumably, this THR factoid would imply that neither Disney+ nor Paramount+ have turned a profit over a full year yet.
WBD made a tidy $103 million profit in 2023 for its DTC content, which may not seem like a lot when discussing multi-billion dollar conglomerates.
For what it’s worth, Warner Bros. Discovery has a net worth of approximately $21 billion, to give you a frame of reference.
But even a modest profit is better than a $2.1 billion loss, which is what WBD endured via its DTC services in 2022.
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Obviously, Max isn’t going to be challenging the undisputed king of streaming — Netflix — anytime soon.
But turning a profit puts it in a significantly better place to challenge the throne than its counterparts at Disney and Paramount.
That being said, the rest of WBD’s 2023 report paints a far less rosy picture.
Overall, the report notes that full-year revenues decreased 4 percent.
And if streaming was profitable, that means the other areas of WBD’s beefy portfolio faltered.
Indeed, WBD notes in its report that its studios division (and this includes movies, video games, etc.) saw a revenue drop of 12 percent.
That is a particularly concerning drop-off given that 2023 saw the release of the “Barbie” movie, which was an unequivocal commercial success.
WBD claims that “lower TV revenues” were the primary driving force behind the loss of revenue from studios, offsetting the success of “Barbie” and the “Hogwarts Legacy” video game.
The conglomerate’s networks revenue also saw a drop, albeit not quite as bad as the studios division.
The networks revenue fell 8 percent, and WBD attributed that to decreasing advertising and distribution revenues.
Warner Bros. Discovery CEO David Zaslav seems bullish on the direction of his company despite the non-DTC part of their 2023 report.
“We have an attack plan for 2024 that includes the roll-out of Max in key international markets, a more robust creative pipeline across our film and TV studios, and further progress against our long-range financial goals and are confident in our ability to drive sustained operating momentum and enhanced shareholder value,” Zaslav said.
