As the SAG-AFTRA strike enters its fifth month, Warner Bros. Discovery has cut its expected profits for the year, claiming its profits could drop by $300 million to $500 million below previous expectations.
It now expects its 2023 earnings – before taxes and other factors – to be between $10.5 billion to $11 billion, instead of $11 billion to $11.5 billion. In part due to the success of Greta Gerwig’s “Barbie,” it still anticipates a free cash flow of at least $5 billion.
The company stated that the change was “predominantly due to the impact of the strikes,” and that, “While (Warner Bros. Discovery) is hopeful that these strikes will be resolved soon, it cannot predict when the strikes will ultimately end.”
The company previously banked on the strikes ending by September, with CEO David Zaslav stating back in May that he expected the writers’ strike to end quickly due to the workers’ “love for the business and the love for working.”
Warner Bros. has been one of the harder-hit studios during the strikes. Last month, it announced that the highly anticipated “Dune: Part Two” would be moved from its November 2023 release to March 2024, and filming for “Beetlejuice 2” was suspended in July. In addition, “Blue Beetle” is believed to have failed to break even due in part to a lack of star powerpromoting the film.
While major studios represented by the Alliance of Motion Picture and Television Producers remain in a negotiations deadlock with SAG-AFTRA over issues such as residuals from shows released on streaming services and increased wages, indie projects continue to be greenlit due to their agreement with the union’s terms.
SAG-AFTRA also voted to authorize a separate strike against the video game industry – specifically the ten member companies of the Interactive Media Agreement – this month, with union leadership drawing similarities between the issues they are protesting in both film and gaming.
(Photo courtesy of ufcw770 on Wikimedia Commons | CC BY 2.0)
