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Warner Bros. Discovery Studios’ Q4 Content Sales Revenue Dropped 19%

Warner Bros. Discovery Studios’ Q4 Content Sales Revenue Dropped 19%

Warner Bros. Discovery’s Studios business segment reported fourth-quarter content sales revenue of $2.9 billion, down 19% from revenue of $3.6 billion in the previous-year period.

Content sales, which include distribution across streaming, cable, satellite and broadcast networks, local television stations, and airlines, also encompass Warner Bros. Home Entertainment.

The latter oversees the global distribution of content through physical discs (Blu-ray Disc and DVD) and digital media in the form of electronic sell-through and video-on-demand via cable, satellite, online, and mobile distribution channels.

TV content revenue declined primarily due to the impact of last year’s WGA and SAG-AFTRA labor strikes, and comparisons with certain large content licensing deals in the prior year period. Theatrical revenue increased due to a larger release slate in the current year quarter (Wonka, Aquaman and the Lost Kingdom and The Color Purple). Games revenue increased due to the continued performance of Hogwarts Legacy, including the Q4 launch on the Nintendo Switch platform.

The top-selling Warner digital and packaged media release in 2023 was Barbie (released Oct. 17, 2023), followed by the disc release of the DC Comics anti-hero film Black Adam on Jan. 3, 2023.

Total studios revenue declined 17% to $3.17 billion from $3.84 billion. Operating income fell 29% to $543 million from $768 million.

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Studios operating expenses decreased 15% to $2.63 billion compared to $2.28 billion in the prior year quarter. Costs of revenue decreased 26%, primarily driven by lower TV content expense, including strike-related impacts, partially offset by higher games content expense. SG&A expenses increased 38%, primarily driven by higher theatrical marketing expense due to the larger release slate.

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