David Zaslav takes on Netflix in its first earnings call for Warner Bros. Discovery

These include streaming; cable and satellite channels from around the world; theatrical film releases; and games.

“I think it’s a big advantage that we’re a fully diversified company,” Zaslav said, acknowledging a “moment of uncertainty” about Netflix and the wider streaming wars after Netflix announced its first loss. subscribers in nearly a decade last week, leading to a morning when its stock fell 35%.

Warner Bros. Discovery was officially launched on April 11, almost a year after AT&T (J) reached an agreement to separate WarnerMedia and merge it with Discovery. The new company includes CNN, HBO, the Warner Bros. studio, Discovery Channels and many other assets.

“Our mission is simple: to be the best storytellers in the world, with world-class products for consumers,” said Zaslav.

He said the “balanced monetization model” of Warner Bros. Discovery gives the company a “single hand” — a not-so-subtle contrast to Netflix, which has always been judged almost purely on total subscriber count.

“Zaslav is swinging out at Netflix,” Rich Greenfield, analyst at Lightshed Partners, tweeted during the conference call.

Zaslav assured investors that “we have no religion about one platform or window over another,” but would rather do what is best in each individual content circumstance. .

Zaslav also bluntly stated that “we won’t overspend to drive subscriber growth” and “we’re not trying to win the direct consumer spending war.”

The chief financial officer of Warner Bros. Discovery’s Gunnar Wiedenfels reiterated the combined company’s intention to find $3 billion in savings.

“That goal will ultimately be conservative,” Wiedenfels told investors on Tuesday’s earnings call.

Wiedenfels said his team was working to “analyze the return on investment (ROI) of every dollar spent” across the company and hinted he was already seeing inefficiencies at the former WarnerMedia.

Executives have warned that the integration of the new company will take time, and they said they will share a detailed financial outlook in the coming months.

But Zaslav also said the new management team will take “quick and decisive action” in some cases, citing the sudden shutdown of CNN+, the news streaming service launched last month in a bid to attract subscribers to an era of cord cutting.

Hundreds of CNN+ employees received layoff notices in what was seen as a prelude to further cuts. (Some staff will be transferred to other roles in the company.)

Conflicting Strategies Doomed CNN+ Amid Corporate Merger

Zaslav praised CNN at length during Tuesday’s call, calling it “the best journalism organization in the world” and saying “we’re fully committed to it.”

He didn’t elaborate on CNN+’s decision, but Warner Bros. executives. Discovery said last week that they determined the previous management team’s plan for CNN+ didn’t fit with the new company, which intends to roll out a single, large streaming service. .

Zaslav and Wiedenfels said on Tuesday that the rollout – combining HBO Max and Discovery+ – will take some time and did not commit to a specific launch date.

Zaslav said the streaming service will have “a range of tiers,” including ad-free and “ad light.”

Media companies are increasingly turning to ad-supported streaming offerings, at a lower monthly rate than ad-free, to attract subscribers.

The comments from the new management team came the morning of Warner Bros.’ first quarterly earnings release. Discovery. However, the earnings report only included Discovery’s business, as the merger only took effect in April.

Discovery reported strong profits for its cable channels and a 13% increase in overall revenue.

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