Warner Bros. Discovery (WBD) 23 Feb 232022 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to Warner Bros. Discovery, Inc. Fourth Quarter 2022 Earnings Conference Call. [Operator Instructions] Additionally, please be advised that today's conference call is being recorded.

I would now like to hand the call over to Mr. President Investor Vice Executive Slabin, of Strategy. Global Andrew you may begin. now Sir,

Bros. welcome Earnings and afternoon, Discovery's to Good Warner QX Call.

Global Perrette, With me Wiedenfels, and JB Gunnar and President Games. President, CEO today is our David CFO; Zaslav, Streaming and CEO; and

company's XXXX. remind the performance. comments the current Before to that business These call Reform obligation Private or uncertainties future that make future involve on other Securities our statements them. today's company statements regarding safe that update are the of you pursuant made we Litigation forward-looking to like to statements, and providing include The materially and harbor differ knowledge prospects events conference include disclaims based management's In financial I'd any we risks results about and start, and the forward-looking to expectations. statements will assumptions intent provisions actual from could plans, Act cause projections of and forward-looking

expectations, could the company's Form For additional Exchange on and to, reports but limited information annual these Securities not U.S. with Commission, and on the that Form its including, and most X-K. important affect filings the XX-Q company's on please XX-K Form report factors recent see

slide QX trending earnings copy at A our of available schedule deck and on release, accompanying is ir.wbd.com. website our

And pleased David. turn to I with am that, the call to over

on to been you us. everyone, forward at work progress. hard Hello, updating our joining since call thank We've you look and last and for our

bulk restructuring very behind took year decisive last bold XX and First, the let this be of is our for action me say, our We company. to the exciting us. promises over a months

company we of are control We have and full our now. one business, command and

the And moving fantastic stronger. rowing everyone we focused our and businesses same a leadership are us forward, have making on We direction. better together, team in

of year be off building of and a a we was will XXXX year restructuring. go. year Last

gaming, decisively distribution sustainable media a a the have, global focus and capabilities, towards and and slate of dynamic increasingly hand exactly to an premium, stretches and entirety creatives, and of across TV, eye brilliant growth. the crowded streaming, production full great play flow reach pay and storytelling it that that theatrical, environment, we IP, ecosystem, best today's and the In free-to-air, the cash has is future that licensing with a and free on we intend hand broad

platforms. to one-of-a-kind is have of franchises we the Thrones, world, that Warner we our and working of take strategic broadest the full intend advantage a to company audience the pillars. recognized Bros. are beloved globally fortunate Discovery Lord Game three we Potter, and across guided a tell We we various company. Superman, huge team, X to as together Rings, these Harry do, the very share storytelling IP most X of we storytelling them share of Batman, and want with by in the stories, In are possible, and best all do that by including

challenging end environment, throughout all outlook, significant of merger $X.X The foundation of I'm year. transformation supporting flow. Gunnar of year, increasingly pleased take our conversion, able made Gunnar driving decisions in by but the the to free deliver by cash end the generate have Xx on see It's laser-focused our further leverage see through clearly cash in we XX expenses. and solid flow ability ago real below are that of team this below very we the the will the organization, Xx reported and were starting created financials this healthy net our a strong motion a working. In over momentum. to we've set free and in billion and strategies months XXXX, notwithstanding we're we've integration-related an to you

losses segment profitability We of in making On reduced sub financial We adds losses targets real down quarter. million laid and quarters in powerful goal to are by the few $XXX QX, net we the in a a ago. achieve our out meaningful on even we brought considerably are confident year-over-year $XXX by It's million and company. in more our to supported direct-to-consumer, progress EBITDA our X.X key working. streaming, million

we across this particularly in managing And key line on KPIs. a in quarter. most segment in More towards from importantly, the we pleased EBITDA trend we breakeven minute, with are to see saw but I'm close improvement QX, Gunnar the as

'XX. launch follow we a are later Consistent in combined with the we Latin told here markets the to America of significantly platform drive months year content and user improved and you what offer The in to APAC stronger this performance, will compelling household. ad-lite to service SVOD tiers in and enhanced streaming our getting product and better member August, product U.S. last EMEA a experience ready for engagement. few every in with and

upcoming April XX. back puts of about a more distribution the the [ENHANZE] forward event press new on launch a video coterminous And completed meantime, U.S. the networks the agreement revenues. of we're We're on with In look these basis excited we Amazon distributors. on details at to channels. Max product And affiliate side, that HBO representing and sharing to renewed able we on XX% our a agreements Prime our traditional align

these overall heads that window the future at Roku reach hard working. of And of It's of on content minute. believe while movies, our I'll motion and putting shared in people. to We hundreds stamp fast picture a new their experience importance TV the deals more with value Tubi, strongly other are having We work and that slate. creative and unmatched content. about in talk platforms, our our also with popular and shows our the maximizing signed adding studio

next storytelling our XXXth and deal change excited. are its to double. into more year, a Pam quality, which will a of the the and diverse Today, entertain, chapter, this in anniversary most to with come output make with at to power front. that more impact Mike commitment of all Lord we to are we and for signed on of And time best, telling or the storied franchises excited multiple to culture. Lord for one lead deepened Bros. celebrate This even Warner the of Studios announce stories, we when to the studio Rings Mike we're movies. Stay and so iconic XXXX, see than tuned the Pam is the thrilled Rings I'm inspire,

television and James A swing, Phase vision world, in few movies and Peter DC new a stand-alone I and already been rolled weeks is especially movie There Batman plan the is we're more to multiyear their with films out Superman anticipated we ago, the IP across for hasn't and in recognized for works, even new X film, animation those most single eager in Studios the and X in highly in creative DC are full era XXXX. fans series of a to under storytelling thrill of television tell decade. excited Superman This a with stories. of and the beloved and some

hit with wait We're it. by made, superhero X Flash, the for to also and loved the and release The Gunn The which wow. excited X masterpiece. in June. theaters followed year, of called of James for Shazam it saw X I It's can't ever movies a in I this Flash greatest films a weeks starting DC the

a games coming which seeing by of we're thrilled business, our of what represents out also part strategy. our core We're overall

substantial we it opportunity. in gaming, as As with the meaningful differentiator only see a scaled studio

more successful launch we our it than to highly retail right. the overwhelmingly X overall launch storytelling, we the of still The to weeks consumers great most the more And get and XXXX. platforms of million global of the franchises $XXX launching the of over commitment reimagined And delayed biggest X in ago, X With consistent been Legacy has game response world. was already in Hogwarts the anticipated from months. We've with sales, few seen we the next have positive.

The and lots there's anticipated ambitious - to release Justice the Squad projections. Combat XX for with set Mortal And League, this including year also highly more Suicide launch games Kill come

We headwinds lift are is was last years. that we've more priority the the get was, a are moment, hand cyclical we teams both business. right. lot we notwithstanding we're and it the together, much as need challenges, several To top have that at a right at dealt a work. said, with to facets end, great linear down on ongoing still heavy what now X hard It and we balance which ad sales there's That particularly drilling we and bring and of being secular a of to economy for the all doing

there, and bringing team. can content her this We've a our shifts early and particularly content-driven we use deliver. we library with will also by plans comprehensive contended our away that and College NFL nets in World during all implemented I'm They revitalize harnessing recent season great the portfolio Football linear to networks. And Cup. are Kathleen in the that and get some together the the to our the have of film of initiatives have with operational benefit and it and that and cable stages television will begun from still and confident portfolio exceptional Finch way of share

that there advantaged events, average key share such networks with and cable NBA all as U.S. when significantly demo. are are XX XX is also our MLB Madness the We fact playoffs. times by our and nightly of viewers And the marquee the XX% to in March higher

place progress. sport. CNN organization, premier fighting wanted and making and politics a side, On be real the and than are we news that discourse for fact-based thoughtful reporting is news the to we hard and stands global as broader

air inclusive on and in viewpoints, long over advancing XX to a balanced our on last seeing speaker a month, we continue are during time, Republicans process, and of first range more a election strategy. came their Congressional We intend when voices demonstrated already this as very

across the great cable on the Licht an brand. of that team global asset for focused that building digital Chris long are and and is worthy term

must it We right. get

more are the I view, and going overnight, this believe my it important is path. we to Nowhere right and isn't happen in on

see the ongoing efforts and improve grow helping and businesses, flywheel turn to we our and opportunity so are much ahead. enterprise-wide The

to the Berlanti, we Goldsman a bring in signed Baz the recent We the creatives and be Zach life. Akiva creators Luhrmann, Shyamalan, weeks, M. Night most with and of prolific with to continue visions including new deals choosing are come. celebrated In place to more Greg industry, to their Cregger number

Lasso streaming than own as and Ted our Television in as Group third-party including currently Bros. production Abbott Emmy shows across more XXX platforms Elementary. and has Warner Winners, broadcast, cable outlets, well

The on Apple network TV's network TV. on Voice, NBC show newest TV. And #X hits, Night on and watched most the the comedy. Sheldon, #X unscripted Young Shrinking Court

Dragon, exactly behind firing on the the HBO at greatest successes is I believe been watch, experience them is and happening to Euphoria, is people. people to want committed creating House with to and of that cylinders of we really see Warner want the HBO. content in of they TV other all stronger also recent quality That Bros. what maker We're shows never has HBO the X hit, episode our Originals, million Lotus, White Last as These weeks, and an newest the X its Of as weeks. about week-over-week growth. viewers Sunday shows viewership mega with for each astounding strong premier Of grew episode have Us. XX million episode in night example, And watched first X. X Us, The by XX just people have The many over averaged after with Last world. million

particularly back shows effect It supersized NBC of day watch the of HBO Again, to Thursday there that great more a TV. all numbers, night. in it And time so people cultural had with my with watch. creating all binge joining direct-to-consumer, of rooms. viewing, huge streaming's the Night is then, Today, TV when are shows These must-see on was choose Those me its is party. to power when and show want stems people must-see Thursday at much the are age and from you of streaming. And impact and culture. And excitement. new people content reminds today's on and more had to That's storytelling.

comes new out watched week by next the time the Every week, airs and millions people one later, of episode last a tens of have the a episode.

to saw. and Social media they are friends their family about calling what talk people and explodes

entire really content believe anticipation that interest can eight, the XX-plus a for the the season of buzz best you That's have all on curation. and power to the that it gist. each that when hits phenomenon but engagement is platform allowing We for and by not by at so good is This way weeks series. once, on part The is of go to dropping drive time. People value to same magic. when a And others, with it to night, when it's expectancy a increases story content be get with And them either tell and there's or build great Sunday great perceived over experience the a excitement. theater it theatrical, a something. in principle and want packed of they you

and complete Bros. globally industry, with across the region and renowned every of virtually most language. we hand entertainment, portfolio every news, assets At have the IP, nonfiction in franchises, the Discovery, in personalities Warner and globe believe of we in and strongest storytelling sports, the

leadership aligned We an across operational is common team and a financial goals have set and strategic, exceptional that truly of metrics.

We of points. world, seeing while to have seller content and the proof and are got we've more increasingly do, strong and we traction in maker largest the lots positive

is us, a For of XXXX year building.

We ever being than the the the company are and entertainment to in achieve our goal confident and world. we more be right that have successful greatest of strategy media ultimately

the the With you that, walk I'll over to it financials for through Gunnar, turn and he'll quarter.

the we them, of took a integration defining The drive repositioning first efficiency we pivotal David. to better and organization support and for very growth. through of Bros. steps. which global Discovery our Warner and initial a end you, which the initiatives marked Among implemented company's number in some finance long-term the chapter Thank fourth sustainable of quarter

We've and I'd and we synergy which a is team to in amount command, function and laid thank difficult these a across This control but part for finance a opportunity executed accomplished and program steps, enterprise like through very positioning their company. continuous first successfully the which in significant persistence on take resulted the in resolve working the entire necessary and XXXX, precision improvement greater of ongoing has to the efforts. foundation this in are

as billion said we this initiatives, for near-term at over direct a our get impact, specific now not few to billion full today, and owner next but through before, in potential of of both representing as initiatives and least $X financial estimate. these $XXX That of represents addressable we extent, components what years. continuous all an to end, Naturally, associated system increase cost are come pipeline us realized out improvement. to prior confident is the total we're or will And With opportunity and tracking working fruition respect in $X longer-term significant the a of to I milestone a over on to that detailed largely these savings of our with have are path million initiatives responsible XXXX, plans.

hundred Through Warner Bros. April XXXX, that million we've billion after the of of inclusive over course-corrective measures end couple already year. dollars undertook synergy, $X we realized in of last a early launching of of Discovery

as high-level are I against priorities remain: key of number incremental previously. operational an billion near-term strategic, larger financial three my $X on and look and laser-focused comprise synergy and XXXX opportunity to our We capture against the our we financial and one, transformation in targets where that targets, delivering towards pillars we core delivering cost principles. mentioned XXXX, the And managing our are

particularly decision-making which or business is ever and and leadership our more is as the viewed, decisions said, David another a as company with to segment framework capital analytical more what partnering such. that we two, monetized incentivized versus how will team windowed. be content our Number a leaders aligned the as whole embrace through of rigorous one some benefits refine Echoing is on allocation strategic

begun I terms believe we've throughout here, excited the to scratch benefits the surface as I'm of the barely potential organization. about this and the cascades in

capital achieve allocation that asset evaluating growth. value and both and so efficiency enhance we three, can opportunities long-term near-term rigor, Number with

within cash conversion see goal our we free our where longer-term of flow sheet, and laser-focused efficiency near-term overall gross reiterate target Xx leverage net towards Naturally, and and driving of X/X prior with XX% by balance the Xx four, end on upside to of of the XXXX. to of by end of to goal. X/X grade the by our mid-XXXX comfortably Number delevering conversion I investment leverage the within are range X.Xx EBITDA towards very adjusted be inside our guidance XXXX

and of we built what targets I and an of second challenging out am the the the environment proud the XXXX the in have half summer exiting we year. in year, in of momentum against the against we achieved proud increasingly I'm set

Turning and to like performance. puts quickly some takes you to through the impacting the I'd take quarter, of

acquisition, the the a the ex-FX first of following the impact forma in we're year Starting will basis. Given discuss on closing still with pro P&L segment. our I Studio

TV first negatively we’ll year, lower the again impacted was revenues by against performance XXXX. expected, last something face tough a comp quarter licensing As in very of

Games year-over-year well & entertainment as year's tailwind comps difficult faced COVID-induced Home content. library to due last for

In made deliberate release less much to and a decisions specific given addition in release in overall entertainment, activity very of theatrical home XXXX, which titles we the about was leaner result dates. schedule

costs. expenses, headwinds marketing offsetting and content fees revenue Partially lower were distribution

and will both game particularly the DC, at Looking ahead on larger year, Pictures Legacy our release a mention behind with Studio, a not and pivotal start within to the wonderful broader slates Bros. Hogwarts XXXX Warner side. be

cost efforts. distribution to Turning the as decreased lower underlying decreased to our general U.S., were as as further advertising by as entertainment Networks. reflecting global a we have continued since exacerbated X%. Adjusted particularly out lower marketing have part as XX% content expenses soften X% audience quarter, and EBITDA advertising by risk and declines the fourth X% costs, as key the Clearly, pointed revenues summer, synergy declined in Revenue in that and declines. personnel through trends, was decreased revenues well offset revenue partially

while limited, improving While trends seeing visibility improvement. in revenue pockets. sequentially meaningful we're indeed revenue near-term forecast very any we this encouraging, remains And hesitant are modestly is certain to

growth Italy And continue and the perform trends part Winter we're which improving. in being the advertising overall global macro we American comping headwind like such political in basis in influences. about are better, rate, account by Nordics international expect markets UK, regional, will in countries. while mindful Though and in we relatively our underlying U.S., we Olympic visibility modestly QX, weaknesses for to XXX roughly markets were stronger Games the Poland and International as point offset Latin certain to see

in the of certain Distribution affiliate this lower rate sports increases to rates impacted European impact. in America part whole helped Latin in revenues were countries, U.S. on by in subscriber declines premium offset U.S. and larger and packages contractual the primarily the while

point Importantly, networks revenues important we distribution successfully distribution portfolio coterminously. value partners. for more of portfolio completed our affiliate of which combined together the XX% brought of U.S. reference our and An which renegotiations, to accounted our than for

operational financial a about happy continued fourth rate especially we performance DXC delivered healthy improvement lends of in exit in relaunched performance. the Moreover, financial sequential I'm QX across to a marked coming key our out in improvement thus the where DXC leading development our segment, of to soon-to-be number a confidence offering. into and quarter KPIs far very the strong

of continue fuel the X% revenue driving with million roughly against in tailwind Casey the and and EBITDA reduced to million, a expenses team improvement in into audience of in growth which acclaimed XX% and revenue. is a up $XXX critical resident combined nice loss to a engagement relaunch. churn, content, year-over-year, globally decrease largely the content-driven QX X% a of operating improvements notwithstanding setting led significantly increase $XXX-plus cost

pricing in well. and service a Moreover, digested which where core million number significant XX and increase year-on-year, in the as the increased while well tier yet has believe we $X has $X.XX. implemented price pricing reflect particularly sequentially retail our was quite upside. LatAm, on international ARPU global in January that markets, strategy Global This million the analyzing increased U.S. ad-free subscribers of X.X key we're been in doesn't our to modestly

another spring breakeven in we the across which or segment and we less traction relaunch marketing P&L content our the financial implies more the seeing in improvement on broad in requisite combined investments of a the result seen sequential the improvement launches. to behind Naturally, expect domestic offering be in roughly will spectrum $XXX in support premier product are of line year-over-year, spend Based QX, million EBITDA in with KPIs, step-up QX in and a QX. in operational increase

our in and very in our we And achieve ability $X However, billion confidence remain internal the continue breakeven XXXX to greater line and track above in the globally. I here, greater and in plans. to trend XXXX targets about our of long-term profitability enthused we of segment U.S. have

headwind Turning adjusted by guided for an quarter flow. QX a than Currency bit decreased to cash headwind revenues XX%, approximate year. results was free while a consolidated million X% and more by $XXX SG&A year-over-year, the X%, the we helped to EBITDA consolidated million EBITDA reduction full decreased and for near in to. $XXX

increase billion. year to securitization related our deal almost million to and in were closing factors, due $X.X QX, number $XXX bringing factors underlying We A full costs in free cash nearly the a expenses a for April. year-over-year on securitization of in million nearly early external free in to generated rates cash reported exclusively market of an of as headwind billion the from year, related $XXX factoring $X.X flow and Note such $XXX facility. that corporate to incremental cash the million flow $XXX and merger integration-related nearly in QX totaled since million the to addition

cash and improvement payments versus EBITDA, from QX initiatives. debt in capital acquisition free result working on the sequential was of improvements flow of the first timing The some QX greater interest

We repaid billion the the nearly leverage quarter with hand, bringing $X Xx. debt transaction since of of billion QX, repaid below closing cash net $X ended billion, implying the of we and $XX.X the gross debt on $X debt just and during to total billion

growth. at takes an Bros. XXXX billion cyclical Games, by These reflect and total broader the remain outcomes capture, headwinds. $X and optimistic we I'm positive with encouraged puts pleased additional Warner macro consider very in company I our to include potential and Turning transformation while revenue ended of repositioning success very release outlook. beyond. earlier the the company EBITDA balance efficiency and and to point, about DXC, for with range my slate ability with of inflection advertising in balanced synergy to the future tides Pictures Reiterating incremental choppy in the outcomes year where will

billion forma representing to in EBITDA expect forma against adjusted to $X.X pro billion pro We in range, of XXXX mid XXXX. growth the of EBITDA mid-XX%, be $XX adjusted low to low

of X/X initiatives, flow, and into I as half timing of determinants We the cash key of being capital the and net continue the be magnitude a given the and billion to convert with $X achieve around spend, working higher content which to synergy efforts advertising stated expect to in drivers possibly the change $X.X growth EBITDA, cash in market. earlier, to magnitude expanded do the end guide free the and synergy transformation target, of our to billion cash some EBITDA XXXX. the trend of impact expect We cost will of of hitting

cash rights debt. in timing timing the With payments Discovery as of cadence content historically of large WarnerMedia, the first cash Accordingly, a acquisition represent respect of cash and of will payments, free and is for the free negative. year flow, the quarter low be to the QX point to sports case legacy the the for both flow outlays we cash given expect interest portion on free flow

this The long-term past this potential first and company and year. steps cash some earnings crucial taken than generation of after free courageous having flow ever, are stronger particularly

our strategic much committed behind executing lean to are the we performance to ahead into are to with drive us. fully us, of continue line initiatives repositioning and We top opportunities beginning

but company in managing not next this short-term mind. vibrant financial are we always, performance, As years XXX creative organization with the for of this rather

turn I'd I will now David, and to and operator, questions. back your that, it to With JB like the take

of Bank Jessica Reif question [Operator comes Ehrlich from first Instructions] with Our America.

was it macro, DXC. David, cetera, CNN, et as lifting you heavy I year 'XX had a mean, whether -- in film, et cetera you and was division, advertising, every of challenges So really really said,

$XX you potential macro but think talk Gunnar of upside, some just new? sounds out about there tailwinds, I'm still that touched in kind I to but what assumptions. you to something could if really didn't to about walking What's wondering like some 'XX, challenges, you to look of mid-$XX billion of it's but billion you're go is in close As in talk away from some can it Clearly, EBITDA for on maybe much, EBITDA. low you have these right? which that the

encouraging. Is include potential balance the potential asset what You there assets improvement any sales? the like within very many nonstrategic is And considering? the you have balance on -- the sales sheet, so that asset are sheet Does company. hidden for

Thank you, Jessica.

guidance that the There be but me And on none that baked below deck the at question. this asset some does The would any are Let with say, as opportunities into include XXXX… second sales. start I'm of not leverage we guidance. looking

Non-strategic…

targets. on to that a of uncertainties it's surprised of And we Yes. the hear. in And year, number early very, outperform outlook, to wouldn't guidance. we as And glad want to those takes be the and able in some I'm last out same look, putting year. the put environment. the here. sales for we in biggest continues hit that out the to hit these targets the you be gone The XXXX here puts with mindset and or very XXXX summer ad that We're a We've were through there's couple of unknown targets

releasing very excited to films, lot to about. a We're have games. be be XX going X of We points

to start. is good One off of very them a

be about are but I in we're relaunch the realistic today. here, anything be forward quarter, about taking to uncertain lot table I'm factors but just JV's So product year. early as what well And a not to want looking those off the in We're second very excited to. that's seeing the

has with year full free market a businesses. early And on we in with We the for Everybody a leadership hit share in a team team flow, each now. is XXX the leaders in of January. cash focus this This place. week strategic met for one top -- of improving

all we assets different And -- I We have our have different. businesses. of control of that the are have that diversity, and think each these command

strength. that Some are advertiser-driven. all is business I gaming diversity The And think is consumer product driven.

Michael from question Partners. Our Guggenheim with Morris next comes

two trends kind you're a coming impact do ask kind If of Appreciate much your feel of that impacts, reflective more. of seeing of more advertising the to declines or with I'd ad types and those how do all you the understand you the trends? macro view some could you're environment? the trying you that about of like those to cutting of information bit share and discussion Really How is trends helpful. advance is that on be just very like core shared. underlying have ratings much this maybe from would to seeing just

structurally your about on service? And service? definitely things service? is any second live something of in pending there content you table make of might my is think product. investments that's of on to put definitely Is And content Turner, on they I to Or sports that that CNN, live question able are that types the relaunch be that so this the that be MAX fuel off content those included are the in or not

me second. Let start the with

for addition gives and on that? of do presentation nourishing significantly entertainment a news XX, of sports. April our and product, this optionality for all to us to terms in will all improved of in our what growth nonfiction, value. for we price anything it. which lay In real the out launch, and We'll that to And churn audience reduction and do be will on J.B., full add overall have

No.

to on XXth looking will willing to options and number content of I world, for of offering might those in we entertainment is of consumers, more is looking sports to Max for more detail. for got complementary a place the really we're think optionality share now today value. in offering, entertainment future, choices, we'll untapped the simplified who and think focus are of we've major news with as David that HBO for right be obviously significant more in and are the That's in are Discovery+ with and terms do what breadth the But the of be on all we and the streaming good X deliver. continuing you primarily forward what and expanded the that said, and step

we're it work about and we learned Europe, fact, sports does use lot a and news -- effectively when And in quite in and it we've when doesn't.

which the really advertising which held a answer. also fourth But The not kind The right sentiment macro market very the bit the a significantly in I outside at is would is inventory, in side, overall quarter has I'll On surprise. is a to quarter. maybe little better challenging. is it's say, terrific. of up scatter now, is complex Gunnar, can follow. fourth it, was just than the softened. The better It's steady -- slow, the the you take very U.S. it swing market digital environment a

an We situation. unusual have

hand, said deal pull we Having live had take upfront, before On effectively them breadth tremendous and to closed together. the share we different we with live sports, two we're entertainment, this and one first bringing tremendous We've teams our news, and now, but that a sales the have that, done reach. together. right nonfiction, teams

and meeting with like think getting hyper-focused this, team, to we're but our on a momentum working a team, I'm feel I new stride some that So as on get that. I starting the once week

for decision you a having business drive years, rather in made this upfront drive really And asset value, more extra also our the price. were significantly I the We drive believe peers. been need we in I to XX to to that, in than in price able upfront to all than drive volume. price order And think of in

And soft have. could volume scatter took we less But we market. to do in than very see now a you order that,

some the as we said think face us where is Having on our us content coming very much in two upfront. took impact months, we with together were in is breadth a versus that that I others of that, this in the go next -- So bigger which upfront, price, having that position positions on up well.

this balance versus we'll of in price. mind keep And volume so

toward digital being in would able are advertisers But it end. on by value. Gunnar? And a shows. putting the because where front very think err it asset very tasteful advertising excited doing to about on that's be we're I price, And really in also these we've way HBO, build I which marquee you introduced very always

also industry, on think versus scheduling I would cyclical little in one development-focused is XX% as partly are levels schedules I the exciting. positioned of tests pot going only there's from no here. team mean, by it's with the doers, of looking think, some to than numbers quarter. the our portfolio screen. this the sports are the done but from ago. grow some doing add David No, the on of down She's enormous We've and minutes I secular, integrated Kathleen of driven or doubt. the coming also the very perspective got that couple are very a we're value in is thing I we've mentioned that, that getting in Arguably, portfolio. a Yes. running worse restructured who of work, the were early, But lot library well a

of to to some a And behind that number assets some larger promoting. here. We we're got that cross the approach opportunity now cases right to real time-tested that we're of launches, work to we've And were promotion, behind some we're and put film launches. our adjusting larger able and the of seeing portfolio

well positioned. think So we're I very

December the environment. the up market do November, the slightly In depressed. I've telecom, as before, compare good a better; it's fast maybe but -- better; not and you said if back; weekly looking but a got food, now a technology little timeframe, it's bookings still of ticking other January entertainment, right areas coming February like completely terms little itself, We see retail, is you've then with small,

So trending some actually still again, call others diversity. really up to with difficult. here. too as It's a I said, change a now, early International, more trend picture similar just areas

Though we assuming second in things the will get that are better half.

a us. Yes. mentioned, available we're year capture the that. very be position market becoming very, the good as more in as well, when last which upswing no to on turns, We're for And sort assuming factor doubt digital especially, a to with that was inventory David limiting have that side going I of here,

comes question from next Goldman with Sachs. Our Feldman Brett

heard right be more curated. word There's recently increasing streaming-centric. media and to for about We've content what the supposed discussion companies the been your become continue pivot general as to entertainment an models strategy

it used during you script. your think I

and licensing. bigger something hear discussion how platforms decide be also a be you your around exclusive when maybe should when you to should You

I updated of you have XX. your product rolled kind just so give So hoping we us new on thoughts, for out was most could the assessing April when you framework that

just terms which that that as Casey is looked spending able viewed. lot what we powerful then see one to content Thank in about where really we we time the we are that diversity Brett, was put content, advantages this wasn't as reducing Sure. there of is have content And content. churn. were think people us have, content being of And big of of a Well, at we to watching, HBO,

quarterback. That's in what And providing direct led able, that so were to movies were we conclusion the really ways, streaming us many to no Monday to morning value us. to

and in so pivoted products. to were optimize -- And windows move all real we where to pushing -- said with our films those which of order back out we going

all storytelling that content content about put a have much better But Max of Discovery fact excited to key the diversity. this we're the together it with going the we the company, take and to in is, a we're So as HBO this company platform.

start have and us. with is off tremendous for to which really storytelling We Hogwarts, games a

her where and to show almost with the on to have we're selling We the in every peers all Channing now or #X in team #X our of our right platform business. America --

have believe menu a it on a believe having That have Max, we ability a quality. that's And build content, in portfolio, We successful all best pick and whatever to baskets product on launch, world is we're that we the us, we impact which then streaming what different curating from best the call And real business. we of people the may take a how and important way impact most the America. HBO to these for really because an it best the we now around consume be profitable in content. that is of on has the

I the biggest to the But so the we're and key building largest long-term in motion TV the we is content us quality the think picture have that that key library other and strength. terms world. in of And producer is of

can that be as important. segment, is free a we, to the flow cash selling so so and successful that drive nourish And to overall media segment,

fold you'd some before, that into was a that which something Discovery answering actually new reiterated weeks the keep few intent you're Is now? as to able content were media to standalone on There product. comment the that an have ago reports you you something question, a Discovery product. In been said going to

robust Many that right bigger Just product, more with are bigger churn simply to want those very low Discovery of it's Discovery+. is that a profitable, now, move people offering. for the those and to a to have up going

For Discovery food, are paying those and and having own that $X happy home, content. $X type or

Our no sub strategy is behind. left

happy We are subscribers Discovery+, have would profitable we off. shut very with offering of that product the why that

will itself shared the it shared is a And be for platform. platform Discovery+ --

to of products. our work all subscribers that of all So all be have this done benefit we platform have of different a that best to we've -- so the will this we build on taken, our

bigger No Brett, be Discovery clear, combined be And just content the that. would available about to product. on the still question relaunched

comes with question Stanley. next Swinburne Morgan Our from Ben

Two tough of of films realizing and the could overall question over the think is to mean expectation, years, sure you a Warner of Bros. DC does next about what David, and Obviously, put numbers which X-plus around. strategy the sort that organization? fully as to earnings company opportunity the sort DC that Discovery of what the I questions. But I'm mean just -- the over But his if Studio impact help power long James for it's successful, your know and your is segment will successful the earnings. term?

outlook growth very revenue and expectations and this you that line Gunnar, quarter, DXC levers growth in had bit the from the $X EBITDA sound little targets, deliver of you the You bullish for next think content, billion billion? revenue advertising you over talk the of and in confident 'XX. do but help lot X% to to have then, a Can that top on years? us $X And a accelerate you order few need Maybe about around about the DXC? your

It's and press We're the this laser-focused about that on Peter biggest on that a X look, the are time were building of to ago. vision with and and creation DC DC presented for you He spending writing in us. value had we Well, for and him XX-year month believe plan. Superman. Ben. we he was James opportunities a in. all Thanks,

pushed be and being because I should wasn't could it it think on. huge

you and the then you of dinner at world, they and If advantage huge you at Harry look In they poles. the Harry Superman, someone's a Potter, dinner home their anywhere love. they'll It's go those without okay? Rings, take that view with of mention -- three, tentpole and the tent look look Woman, in a D.C., that Lord Potter company got at at to at those product those they Batman, Warner the to Wonder country, of every products gives when three watch X:XX and as Lord a Rings. It that leave and

have company. we own, create we But great so that the to marketplace take we we are in to that IP -- but advantage to that advantage, get that a we have overwhelming storytelling And the I with an with -- believe content IP.

IP. that So storytelling

done Superman movie years. a in We XX haven't

is We And Potter own a decade. of success, Amazon at those haven't it which franchise, on pushing Harry over the Rings, new Andy with Jassy a of lot was fantastic Lord a in rights. done content we movie but

industry to for for And treasury company. have us, DC film, game those so I now best to on to as swings. the we right a that there We no want because lot alone even some will the and left parties, and on have a be that was And And think strategy to unified got be optimize in sell creatives TV -- else focused table. we could a of take swings. third should we across And something, got a that take those We has. the changer. the one we

it. let Keep Yes. We one we've year impacted now, last side. coming that from an headwind Amazon. we're the on by entire mind, And was and start on for seeing thing now. are inflection growth Ben, definitely the side of lapped revenue revenue in me of the DXC the question, this planning some off with And

DXC baked are planning product we're HBO be We'll sort of for -- revenue improvement. revenue always little lower of our will definitely definitely maybe pure-play that the trends linear number. because a a We just into than

launches for right in investments. the content side, after down metrics at start cost later market we're launches, the these hopes the see We've churn, going on of we pointing And rightsized of again. all which have efficiencies the improve. engagement, new further the come obviously And combined high then better looking all trends to road, product to also We are direction. marketing makes better And the up.

it's ingredient. The is that's a only just for important question not other us, Yes, add, scaling. thing Ben, subscriber one I'd of

growth revenue historically So at as before, is our Max pricing market price we ultimately we important part. as is part subscriber under we look a that churn important do see very scale coming We as one We been Internationally, on down of said I've important. is. see that story. coming products relatively as see with a third HBO that where two product second the the higher variable has the think the together, significantly

be improved we opposed some of in we're ahead. putting just look And then from on enhancements now in eventually also at content and having at ad-lite much help like new all could will of rolling about U.S. to going obviously, to pricing some that before, of content fact and the further product, of the engagement, the those as our Max on help years we talked our rights all to both of for that the sports and monetization, out and and all the we're the product a news in which the HBO including, the addition scale obviously Max, with a revenue content standpoint some drive will the HBO us ads higher features part mentioned be the in the drivers as just that performance David earlier,

next Comes Our SPX with SVB MoffettNathanson. question from Robert Fishman

or J.B. Gunnar. for I one David have for one and then

upcoming HBO how service to new the forward? DXC same First for relaunch, while premium on balance the plan help bit David, can you as brand at drive you a part the little going the protecting talk content about time, of leaning to HBO just the

service? you just why impact deal your strategy your or the for Roku Gunnar expand the and how fast to own might JB, Tubi and of with timing you then launch do and that can upon And fast or maybe chose maybe

passively, very at together in we more do, content during Discovery+ is Sure. more Look, is to HBO, more heavily the family, against the the day Discovery+ viewed content, fit more the a we with more, family. the everybody the we watched symmetry mostly more for content, hours infringe HBO which maybe day, think research which and these it, of that the look appealing well the with

and so more that. about And confident feeling we're more

a On really we'll the but what the have world XXth, with we'll to where attack that across you we'll it you, locked the and clear plan But is into to this drive lay plan, on out how intend through loaded. around do take conviction. and XXth, we well and we markets country the

FAST…?

Oh, on FAST.

that linear questions about defined is it pay the X the would -- strategy. some earlier, are distribution, every the environment, at real keeps back have we reality the what to think on-demand like at one have say a assets of the question streaming, us On is television, be windowing asset to windowing. static is, TV. team, it a in windows different form want doing so XXX% look, I looking advantages is, day, we the today's games, think, end what dynamically market in Robert. you our is having television of through all media, theatrical as reality we up and The is we Sorry, feel distribution free-to-air, The FAST, is strategy almost wouldn't actual evolving coming the of I whether of the be

the to a is as viewing data will, water, we you if as at go us, more in the Roku year, And not. position be gives to us online. area moving we Tubi come The but in think, toe distribution look deal beginning we a the for those market. what lot look just having we and FAST in free-to-view to was one there'll evolution free-to-air at shows need of channels, and the really that through lean the XX do very a want bigger ad-supported look around to the a shift the behavior, that or want what space have to having content. to consumers strong at call and consume where don't see will all consumer robust world, to have, who in of continuing behavior presence a enough us the because And that of we we a do amount consumer yet outlets we we obviously and see we optionality further

of think across which risking have uniquely business, able windows, obviously we continue or do that to focus jeopardizing the we'll upstream we're some that without depth and breadth to the our the with on. company, And the content very business theatrical subscription we or of

question comes Markets. Kutgun from next Our RBC Capital with Maral

streaming the on up follow discussion. to want I

curve of like their international, reshaping profound content their seems content pricing just ahead pretty investments, licensing, here, everyone their content is it's much types of You've it been in philosophy the strategy these and so but structure, whether around spend, and exclusivity streaming days more. org ways,

fact us each that not pretty industry I and could to think impacts the focus usually top dramatic landscape. but moves for many competitive maybe the have enough to company's of of is each attention these profitability, there's the

So about I that? open-ended see can with where streaming but industry WBD you question, does And it's talk changes? the these know you a in how fit the pretty overall evolving

of aware different market are the believe, the that and us, to product for we all now, look, our Well, together so and people putting that and content easy right that it's a of is best-of-class fast building service. then recreate is as content focus have. all our consume said, our of then I and -- which the JB we that And service, sort own do will do as which then we -- we'll free, ourselves company, this be ad-lite. a run believe, streaming there'll ad

look And at have want create whether look and picture we free, look it a to content world. the TV largest all want that anybody with you just or ourselves. you you want by in with we put because to on -- for so effectively, have And premium to that content sense motion from you edge, a being buying at you makes and opportunity to it us, a library can at Tubi the would we Pluto able without want

we monetize content to as in so well world, isn't to our that ability of to of in which content and free helpful country, churn. producer we we as that isn't company everywhere or -- a effectively this that run is owner top in to subscriber in the an to addition, And as drive And service service, the so critical could we we'll -- cash the a AVOD reach growth. to every streaming flow the want But want lot largest super everyone the serve to critical and world. priority

could a look we've some content last real platforms platform to HBO, And having is nonexclusively instance, on at of the we on and each on for beneficial. the of sell that appear content of was two of viewership our years. XX% the see, of others it very to chance had at HBO good majority over the is And And content content. economically the news only

should we monetize order there need XX% why being shareholder was that So was that drive in to to hardly viewed. And value.

we ad-lite the have. we once create funnel, ad-lite loved on AVOD the where subscription, or and down in for of subscription. all a And then season we take up advantage the can service. ecosystem, ad the and or first pay our of that we the establish then you take can this of own on succession come put free. can full basically, content like season. second our things own, flywheel you you And the we we the that And And if it, then could We

that at of just share a to because think at quantity we a the day, cost. therefore, of go was said industry on any consumer I from seven wallet over And spend in at six, to either in say only they quality five, better want services needs over and end think services, where August, the of of has don't a spending I David I they content more we a breadth choice in at profitable The scale. add to the ahead. is able as said last in fewer before, get the believe, point I was obviously quality, choice and believe rationalized. be No, going have was And anymore. spend-wise, We quantity just to time just scale starting industry

on we and the put ingredients on at which two as something us together in think that will help we so for has major us Max help a household, scale And Discovery+ on deliver well great we're engagement. HBO focused you obviously value, something proposition everybody the and the and churn, as ultimately which are

community front is watch content conversation. loads us for a people a up set time can But There's it, creating that curation, curation. out point creating is at of other The there. content when or

you're Euphoria, and million people If online XX deliver either your able growing Of either it theater, you a look you're alone. or to America it was most friends, million, conversation. million, to others, not a and in of with you're in when Us, able at XX is powerful every The Storytelling talk when have that's viewing it Last power watching with content or content, XX to it week, content be be about watching to then the you're

so really of big of only the people And a very half Warner Content advantage. a watch alone piece Bros. content the equation. Discovery experience can it is that and shared is curating have

in the you have you. world. We audience or We we've movie. can HBO on biggest into put Sunday your night to right see can you could We take Monday you right into America, the on on it's put a night, the theater with or around can HBO on must where Sunday streaming TV launched tuning we

what to creative here have at seen, content that's So resonating is all great I elevated is their on talked they the and be want the of And think platform. both the that that the the want an for talent to that's really theater feel to and wants. cultural Bros. it's part respected. something -- to that's they curated culture that They Discovery. and content and with is seen, community their want Warner opportunity in conversation, be And it's about,

weeks two ready about producing, content selling, -- more our And we're to months, getting us great shows the did platform? in did, that we it's I've it what and that years to with are All going had probably last work going new us. thing two to overwhelmingly for behind that we the now work are right on it's hard in meeting we best all that now we for going that how launch. keeping that the meetings of shows XX want come more what our And be was that are have we of almost -- creatives here, we is be

is we think I I time -- think made really exciting tough this an So because we're decisions. some

we may good and are, forward. Some where but feel we of accelerating them to adjust, really we're about we find we need

question comes final Our from John Hodulik UBS. with

number wrap have content cash on and on versus of like the on up David, time, 'XX. have, maybe of a you of just total hand, one A programs, guys competitors same cut your to it they're at side. amount new on pulling a but lot movies of initiatives; new sounds Is new lot back the lot content the that that of some floor. the sort the a on that content spending in 'XX --

terms should in what 'XX? expect of Just we 'XX versus

the affiliate and just XX% And results as that how renewing think mean pricing into side, should should of then we on translate of deals. your out I of we sort to look how sort of 'XX? affiliate

want Gunnar, do to you start?

over Look, we're we as what It's content open a content said, on going place obviously, doing, and quality mean flow course adjust. be we'll of for we're leading the keep of the there's that for as always and But that's I business. to write-offs investing. to the cash to restructuring going backbone Yes. changes well and Remember, year, through spend, the content last all our strategy

content not And of time. launch to it's any is we're before going tenets one the

with. get making about have about Hogwarts it, We took rework reworking months that lot quick. not to we're it The a It's story. out telling game, it a to content out several It's getting It's lot of a right. certain progress for the best not we and it date. getting of additional motion picture about

going fighting example the that. be so this we're year, -- of example is that. going to us And DC. is on we're see to of best -- And Channing the best you're now Casey

product -- Warner see see it's opportunity -- Bros. that think Warner done. best in could it a quality to is huge investment You're Picture going side story before the And any Motion a Picture fighting think difference we the you're we're there's I it's something, be. we going going to But for at storytelling. that on tell order Bros. I going it's think side, not us release to when a be and to big really in Motion the to content on

-- value step the Taking completely business the to we've went, reason to renewals, said the to discussions why and the the very about mean, regarding a one, a separate back why a our network delivering where And is, is be our that business, affiliate couple happy reasons one of we're those linear I how linear we as out with the network affiliates. here, testament segment times is moving. carved though, trends are those is transparent portfolio clear the of that importance

segment net-net, would I've and point. It's the sustainability revenue years free cash of a the that's years expect delivered about I have to growth. that that longevity before, sustained point, have the That's where as And that And not that doubt I said segment. our a we by no the flow coming being and way. not

Q&A presentation. now conference. which today's session today's closed, you concludes attending Thank is for

disconnect. now may You