Tax Write-Offs For Content Are Over At Warner Bros Discovery As CFO Once Again Scolds Entertainment Biz For “Spending Frenzy” – Deadline
The days of Warner Bros. Discovery cutting content for tax purposes is over, according to CFO Gunnar Wiedenfels.
Following a series of brutal axings in 2022, including shutting down big-budget tentpole Batgirl, killing J.J. Abrams’ HBO drama Demimonde, culling TBS series such as The Big D, Chad and Kill The Orange Bear as well as a raft of cancelations including Westworld, Wiedenfels said, “We’re done with that chapter”.
Speaking at a Citibank media conference, the exec also took the opportunity to once again chastise the entire industry for its spendthrift ways. Asked by moderator and veteran Citi analyst Jason Bazinet about where the company lies on the spectrum of direct-to-consumer and wholesale content production for others to distribute, Wiedenfels replied, “The truth is in the middle.”
Wiedenfels said that it “took a little bit of time to make sure that we do it properly”, which is why this process took up to seven months.
“That was very important to all of us to really use 2020 to leave the purchase accounting behind us leave those initial strategy changes behind us get it all, get it all out there in terms of our restructuring estimates, and then be able to turn the page and move forward,” he added.
WBD has gotten “a lot of public noise about the content writeoffs that we took,” the exec continued. That is “a reflection of an industry that went overboard and went on a spending frenzy. There was a lot of thinking of, ‘let’s do more, more, more,’ not necessarily ‘let’s do the exact right things, let’s do what works.’”
The company has projected it will achieve $3.5 billion in cost savings as a result of the merger.
Declines in WBD’s stock price in recent months have reflected widespread uncertainty about the merger. They slipped below $9 last year, from almost $25 when the deal closed last April, though this week has been a stronger start to the year. The stock was up about 6% today to around $11 in mid-day trading.
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