Sources claim that Warner Bros. is gearing up for significant layoffs at the company.
As reported by Puck, sources claim that Warner Bros. will be initiating layoffs on a rolling basis between the beginning of August and Labor Day, starting with smaller groups. Those layoffs will continue exponentially throughout September and October and are intended to finish before Oct. 31 as a way to deal with the "bloat" at Warner Bros., which has been noted by those coming from Discovery following the merger of the two companies. Layoffs will reportedly include marketing, PR, distribution, sales, legal and creative, though one source states that most departments at Warner Bros. will be affected. The intention seems to be to reduce costs overall, with one business leader calling the reductions "painful" and "to the bone."
Warner Bros. Discovery recently revealed the details of its second financial quarter, revealing that the company had taken a net loss of $3.4 billion, with $1 billion attributed to the restructuring costs of the merger. It was also detailed that the studio had lost $825 million on content and $208 million on employee termination.
This news comes after reports that Warner Bros. movies would no longer be guaranteed to hit streaming after a strict 45-day theatrical release window. While it was initially the plan for Warner Bros. to send all of its films to HBO Max in 2022 after 45 days in theaters, sources state that the company will now decide when these films will be sent to streaming on a "case-by-case basis." Despite the rumored layoffs, this report came after Warner Bros. Discovery President and CEO David Zaslav, who stepped into the role in April, revealed that the company would be increasing its budget for HBO Max in order to produce new series and content.
"Quality is what matters," Zaslav said. "Quality is what [Chief Content Officer] Casey [Bloys] and that team is delivering. It’s the best team in the business. We’re doubling down on that HBO team. They’re all committed under contract and we’re going to spend dramatically more this year and next year than we spent last year in the year before." It was also revealed during Warner Bros. Discovery's Q2 earnings call on Aug 4. that the company would be merging HBO Max and discovery+ into a combined streaming service by summer 2023.
Warner Bros. sent shockwaves through the entertainment industry when the company opted to shelve both Scoob! Holiday Haunt and its upcoming DC film Batgirl, which would have premiered exclusively on HBO Max. At the time of its cancellation, Batgirl was estimated to have cost between $70 and $100 million.
According to inside sources at the studio, the decision to scrap Batgirl was "not driven by the quality of the film or the commitment of the filmmakers, but by the desire for the studio’s slate of DC features to be at a blockbuster scale." Zaslav indicated that part of the reasoning behind Batgirl's cancellation was to "protect the DC brand."
Source: Puck