CNN has informed employees that layoffs are underway as parent company Warner Bros. Discovery (WBD) looks to slash $3 billion worth of costs over the next two years.
According to an internal memo obtained by Yahoo Finance, CNN CEO Chris Licht wrote to employees on Wednesday: "Our people are the heart and soul of this organization. It is incredibly hard to say goodbye to any one member of the CNN team, much less many."
"I recently described this process as a gut punch, because I know that is how it feels for all of us," he continued, adding: "It will be a difficult time for everyone."
Licht wrote in the memo that CNN would notify affected employees and paid contributors over the next two days. He said would follow up with more details on the layoffs and changes on Thursday afternoon.
Warner Bros. Discovery recently laid off around 70 staffers working in sports across brands including Turner Sports, Bleacher Report, and studio operations in Atlanta. It slashed 14% of its HBO Max workforce earlier this summer.
So far, the company has eliminated a reported 1,000-plus jobs across units.
'It looks messy, and it is messy'
Warner Bros. Discovery CEO David Zaslav has been aggressive when it comes to streamlining the debt-ridden business, which officially merged in April 2022.
Since that time, though, the stock has plummeted more than 50% amid increased restructuring charges, macroeconomic challenges, further subscriber losses in linear television, and a slowdown in advertising.
Zaslav recently commented on the future of the struggling media giant, comparing the company's merger challenges to painting a mural.
"We're painting a mural on the side of a building, and all kinds of stuff is falling off," Zaslav said in an interview with RBC Capital Markets analyst Kutgun Maral earlier this month. "It looks messy, and it is messy. It's really hard and it's really challenging."
The executive went on to describe the economy as "weak" and the advertising market as "very weak" while recognizing the uncertainty heading into 2023.
"I can't predict what will happen, but we're in the process of really restructuring how we go — the cost structure of our company, the efficiency of our company, how we operate in this new environment," he said, reiterating the company’s $12 billion earnings forecast for 2023.
While addressing recent headlines of slashed production budgets and shut-down projects, along with the removal of several titles from the HBO Max platform, Zaslav revealed HBO lost $3 billion last year after spending nearly $7 billion on content over that same time frame.
"We have the best IP in the world," he asserted. "We need the best structure and we've got to spend money where it's working."
Zaslav doubled down on opportunities within the brand's tentpole franchises, including the DC Universe.
"Part of our strategy is drive the hell out of DC," the executive revealed, adding: "It's one of the biggest opportunities at this company."
Warner Bros. Television Studios CEO Channing Dungey teased on Wednesday the studio is currently in talks to close a major animation deal with Amazon (AMZN) for DC-branded content, further emphasizing that strategy.
Layoffs have been seen across the media sector as the industry struggles to offset cable declines and navigate the ultra-competitive streaming market.
Most recently, AMC Networks (AMCX) revealed its plan to cut about 20% of its U.S. workforce following the quick departure of CEO Christina Spade.
"It was our belief that cord cutting losses would be offset by gains in streaming," AMC Chairman James Dolan reportedly told employees. "This has not been the case."
Alexandra is a Senior Entertainment and Media Reporter at Yahoo Finance. Follow her on Twitter @alliecanal8193 and email her at [email protected]
Click here for the latest trending stock tickers of the Yahoo Finance platform
Click here for the latest stock market news and in-depth analysis, including events that move stocks
Read the latest financial and business news from Yahoo Finance
Download the Yahoo Finance app for Apple or Android
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube