Warner Bros. Discovery reportedly is slashing 1,000 jobs as the struggling media giant faces calls to sell off assets that include ratings-challenged CNN.
The layoffs, which began earlier this month, will hit the finance, business affairs and production departments and at streaming provider Max, according to entertainment news site Deadline.
The cuts come during a chaotic period for the David Zaslav-led entertainment company, which last week announced that CNN will chop 100 jobs under a major restructuring by new boss Mark Thompson.
Since the merger between Warner Bros. and Discovery in 2022 — which brought CNN, HBO, TNT, TBS, Food Network and movie studio Warner Bros. under one roof — that company’s stock has plunged 67%.
A leading analyst at Bank of America called on Zaslav to explore strategic options, including a potential sale of some of those assets
“In our view, the current composition as a consolidated public company is not working,” analyst Jessica Reif Ehrlich wrote in a note to clients Tuesday.
“At current levels, we argue that exploring strategic alternatives such as asset sales, restructuring and/or mergers would create more shareholder value vs. the status quo.”
WBD faces financial headwinds at its linear business, a soft advertising environment and from last year’s Hollywood strikes. It also is on the verge of losing its long-running NBA media rights to Amazon and NBC.
The analyst laid out a few scenarios, including spinning off linear channels — including CNN, which she estimated is worth about $6 billion.
That could allow its streaming service and studio assets to grow as a standalone company.
She also said another option would be a joint venture or merger with another streamer, such as Paramount+, or merging with a broadcast network.
The company is already teaming up with Fox and Disney on Venu Sports, a sports streaming joint venture slated to launch this fall.
“While several financial assumptions behind the combination of Warner Media and Discovery have not materialized, we still believe several of WBD’s assets are best in class with tremendous unrecognized value,” the analyst added.
Warner Bros. Discovery did not immediately respond to requests for comment.
Shares of Warner Bros. Discovery rallied over 3% in midday trading Wednesday.
Warner Bros. Discovery is not alone when it comes to layoffs. Paramount is expected to slash $500 million from its budget ahead of the close of its acquisition by David Ellison’s Skydance.
Disney is also expected to make more cuts in the coming months.
