The ongoing WGA and SAG-AFTRA strikes in Hollywood are taking a toll on the financial health of major players in the industry.
Warner Bros. Discovery, led by David Zaslav, has revealed that the ongoing strikes in Hollywood are likely to harm the company’s earnings in 2023.
According to a recent SEC filing (as per Variety), WBD anticipates a negative impact ranging from $300 million to $500 million. This is expected to result in lower adjusted earnings for the full year, projected to be between $10.5 billion and $11 billion.
The cause of this financial hit is the ongoing work stoppages by the Writers Guild of America (WGA) and the Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA).
The Writers Guild of America, representing over 11,000 writers in the film and television industry, began their strike on May 2.
SAG-AFTRA, representing approximately 160,000 actors, joined the strike alongside the writers on July 14.
Unfortunately, there hasn’t been much progress in negotiations between the two sides since the strikes began.
Warner Bros. Discovery Hopeful WGA/SAG-AFTRA Strikes Will End Soon
Warner Bros. Discovery (WBD) has expressed optimism about the resolution of the strikes in the near future, although they have not specified a particular timeframe for when the strikes might come to an end.
In its SEC filing, the company said:
“While WBD is hopeful that these strikes will be resolved soon, it cannot predict when the strikes will ultimately end. With both guilds still on strike today, the company now assumes the financial impact to WBD of these strikes will persist through the end of 2023.”
The company has revised 2023 guidance which had previously assumed that the strikes would be resolved by early September, as mentioned during the second-quarter earnings conference call.
Zaslev-led company further said in its regulatory filing:
“WBD continues to prioritize and work diligently with other industry leadership to resolve the current WGA and SAG-AFTRA strikes in a manner that is fair and values the important work of, and partnership with, the writers and actors,”
Zaslav has been involved in talks with the striking Writers Guild of America union, which has been on strike for over 100 days. He’s also been in discussions with the actors’ union, which started its strike in July.
These strikes have halted Hollywood production, affecting companies like Warner Bros. Discovery, which owns TV and movie studios, as well as a significant number of pay TV networks.