Since taking on the task of overhauling the newly merged company in 2022, Warner Bros. Discovery CEO David Zaslav has faced controversial decisions such as shelving completed movies like Batgirl, rebranding HBO Max as Max, and combining the company’s prestige TV content like The Sopranos with reality television on the same streaming service.
The company laid off hundreds of employees and shut down the streaming service CNN+ just a month after its launch. Zaslav acknowledged that these layoffs were difficult, but necessary due to the changing nature of the industry. He emphasized that the media industry needed to reshape itself to keep up with the generational disruption brought on by streaming.
Zaslav also stressed the need for a “healthy company” that no longer loses money on streaming content. He highlighted the company’s focus on increasing cash flows to pay down the $56 billion in debt taken on to pull off the merger. The company has paid down $12 billion of its debt so far and successfully generated $5 billion in free cash flow over the last 12 months.
Additionally, the board overhauled executive compensation, linking performance bonuses to the company’s cash flow numbers rather than its stock price. This decision reflects the company’s dedication to creating a healthy, profitable, and sustainable business model, prioritizing financial stability and profitability over excessive spending.
Zaslav has made it clear that the company’s goal is to compete with leading streaming services without getting caught up in reckless spending wars. The strategic focus is on a leaner and more judicious approach to content production and streaming, ultimately paving the way for a profitable and sustainable future for Warner Bros. Discovery.