NEW YORK – Warner Bros. Discovery, led by CEO David Zaslav, has achieved a milestone in the streaming industry by becoming the first Hollywood conglomerate to report a full-year profit from streaming in 2023. The company’s streaming segment posted a $103 million profit, marking a significant turnaround from a loss of nearly $2.1 billion in 2022.
Throughout the year, Warner Bros. Discovery saw improvements in its streaming bottom line, with its streaming segment revenue increasing due to subscriber price hikes and higher advertising revenue. The company’s streaming profit in the first three quarters of 2023 compared to substantial losses in the previous year, demonstrating a positive trend in its streaming business.
Despite a weaker advertising market in the fourth quarter, Warner Bros. Discovery achieved a 3% increase in streaming revenue, totaling over $2.5 billion. The company’s full-year streaming revenue climbed 5% to nearly $10.2 billion, signifying a strong performance in its streaming business.
In addition to its streaming success, Warner Bros. Discovery also achieved its year-end goal for debt reduction and exceeded its free cash flow target for the full year of 2023. The company’s net leverage ratio, a key performance metric, came in at 3.9 times, beating its target of four times or below.
However, the company also faced challenges in its advertising and studios segments, with declines in ad revenue and a drop in studios unit revenue. Despite these challenges, David Zaslav expressed confidence in the company’s future, outlining plans for international expansion and a more robust creative pipeline across its film and TV studios for 2024.
Warner Bros. Discovery’s success in achieving profitability in its streaming business reflects the shifting landscape of the entertainment industry, as traditional Hollywood conglomerates strive to compete with streaming giants like Netflix. As the company continues to navigate the evolving streaming market, its achievements in 2023 position it for sustained operating momentum and enhanced shareholder value in the future.