On April 8th the Warner Bros. studio completed a megadeal to acquire AT&T and Discovery.  Four and a half months later, the company is out 83 billion dollars (AT&T bought Time Warner in 2018 for $85 billion), but the stock is still sinking. And is now down around 45%. 

WBD is $55 billion in debt. But the debt isn’t going anywhere yet. And no matter what they cut it keeps the stock downward.

With the merger complete, Warner Bros. Discovery (WBD) has become a newly minted streaming service. And they have been frantically cutting costs ever since.

 According to Variety, all the moves are to make good on CEO David Zaslav’s promise to cut $3 billion in expenses. 

 Zaslav was paid $246 million before the merger. He is currently executing his plan to combine HBO Max and Discovery+ profitably. And many in the industry think this is a bad plan. In May, Fortune named him one of the 10 most overpaid CEOs in the Fortune 500.

The company has been upfront about finding $3 billion to cut. And Zaslav admits they are only a third of the way there. 

"We have implemented initiatives leading to $1 billion in run rate synergy over the next 12 months, with at least an additional $2 billion in the works as part of our cost synergy plan," Zaslav said in the August earnings call.

Warner Bros.-Discovery cutting content and costs

The process started on April 21st when CNN+ was pulled from the schedule. Since then, the company shelved a completed Batgirl movie. And pushed back the release of 2 other DC comic-inspired superhero films.

The "Shazam" sequel that was slated for a December premiere has been pushed to March 17, 2023. And the Aquaman sequel originally set to debut on March 17th that Shazam is premiering won’t appear until Christmas Day 2023.

Earlier this month the streaming platform removed hundreds of classic Sesame Street episodes. And they have been cutting dozens of upcoming projects. And a couple of days ago they pulled the plug on an animated Batman series from Matt Reeves and J.J. Abrams.

"We've been able to dig deeper into the financials and have gained a much better, more complete picture of where we are and the path forward, including identifying some additional and unexpected challenges that have and will continue to require our focus and attention," Zaslav added.

So far, the result has been a total of $20 billion in market cap. Which means WBD is worth about $20 billion less than when they started cutting costs. 

The company also reported an operating loss of $3.4 billion in the second quarter.