Warner Bros. Discovery U.S. Networks chairman and CEO Kathleen Finch will retire after 25 years with the company. Following her departure at the end of the year, the division will be led by Warner Bros. Television Group chairman and CEO Channing Dungey.
“There is no one better at developing captivating content, compelling talent, and meaningful lifestyle brands than Kathleen, who has been my partner as we built our premier entertainment networks at Discovery and created Warner Bros. Discovery as an unscripted powerhouse,” WBD CEO David Zaslav said in a statement. “While I understand her long-standing decision to retire, I will certainly miss her, as will the entire company, which has benefitted from her unmatched collaboration and unique understanding of what our audiences crave.”
Zaslav added that Dungey is an “unparalleled creative executive who has shepherded countless award-winning hit shows.”
“She has the ideal expertise and experience – as a content developer, platform programmer, and network executive – to lead the US Networks,” he said.
Finch joined Scripps Networks in 1999 as a programmer at Food Network following a 12-year stint as a journalist at CBS News. She would help turn the network into a television mainstay, developing talent including Bobby Flay and Guy Fieri. Under her leadership, the Property Brothers, Drew and Jonathan Scott, would also be introduced on HGTV.
Following Discovery’s acquisition of Scripps in 2018, Finch served as the company’s Chief Lifestyle Brands Officer, where she led HGTV, Food Network, TLC, Investigation Discovery and Travel Channel.
In 2022, following the creation of Warner Bros. Discovery, Finch assumed oversight of animation juggernauts Adult Swim and Cartoon Network, as well as entertainment cable networks TNT and TBS. Notable projects under her tenure leading the U.S. Networks division include ID’s “Quiet on Set” and TLC’s “90 Day Fiance” franchise, which is available in 216 territories and 44 languages.
“The greatest joy, and the part I will miss the most, is the incredible people with whom I get to work every day. Starting with David and throughout the organization and of course all the amazing on-air talent, this is one of the smartest and most creative groups imaginable,” Finch said in a statement. ” I am so proud of what the US Networks group has accomplished together, and I know under Channing’s leadership there are many successes to come.”
The announcement of Finch’s retirement comes as Warner Bros. Discovery recently recorded a $9.1 billion write-down on its networks segment during its second quarter earnings for 2024.
The impairment charge was triggered in response to the difference between WBD’s market capitalization and the book value of the networks segment, continued softness in the U.S. linear advertising market, and uncertainty related to affiliate and sports rights renewals, including the company’s recent loss of the NBA media rights. Warner Bros. Discovery has filed a lawsuit against the basketball league after its proposal to match Amazon’s $1.8 billion per year package of games was rejected.
“It’s fair to say that even two years ago, market valuations and prevailing conditions for legacy media companies were quite different than they are today, and this impairment acknowledges this and better aligns our carrying values with our future outlook,” Zaslav told analysts during last week’s earnings call.
Chief financial officer Gunnar Wiedenfels added that the outcome from the impairment charge is “consistent with where the market is” as it pertains to the linear television market and what the investment community reflects in the company’s stock price, which has fallen over 69% since the April 2022 merger between WarnerMedia and Discovery.
“There is a transition in the industry. There is a transformation of the company,” Wiedenfels continued. “We are actively driving that to some extent and the goodwill impairment at the end of the day is the accounting reflection of that state of the industry and our strategy.”
During the second quarter, Networks revenue fell 8% year over year to $5.27 billion, while adjusted EBITDA fell 8% year over year to $1.998 billion.The revenue decline included a 9% decrease in distribution revenue to $2.68 billion, primarily driven by a 9% decrease in domestic linear pay-TV subscribers and the impact of the company’s exit from AT&T SportsNet, partially offset by a 5% increase in domestic affiliate rates, and a 10% decline in advertising revenue to $2.2 billion, primarily driven by domestic networks audience declines of 13% and the soft advertising market in the U.S.
Warner isn’t the only one to write-down the value of its linear networks. Paramount took a $5.98 billion impairment charge for its cable networks in its latest quarter, while AMC Networks took $97 million in impairment charges related to the devaluation of its international business and BBC America.
Shares of Warner Bros. Discovery are down 44% in the past year, 36.7% year to date and 24.9% in the past six months.
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