Although The Hollywood Actors' Strike Is Resolved, Several Large Firms Will Still Be Affected

The impact of the strike on the company has, thus far, “been negligible,” Disney CEO Bob Iger told CNBC’s Julia Boorstin prior to the actors’ union and studios reaching a labor agreement on Wednesday night.

Additionally, he stated that a settlement as quickly as possible will assist maintain the summer box office schedule for the following year, which is exactly what the tentative deal accomplishes.

However, the effects on media and entertainment companies are different.

Sony reduced its projected operating profit for the movie division’s fiscal year to 115 billion yen ($762 million) from 120 billion yen due to the actors’ strike.

During Thursday morning’s results call, Sony officials stated, “We are seeing negative impact such as a delay in the release of certain motion pictures and a delay in the delivery of television productions due to delays in production and constraints in promotion activities.” “We have factored the impact that is currently foreseeable into our fiscal year projection.”

Sony delayed the premiere of its upcoming “Spider-Verse” film and its Marvel Studios collaboration “Kraven the Hunter,” two potentially huge blockbusters, to next year while Hollywood actors and writers were on strike in July.

Executives from Sony also issued a warning regarding possible repercussions from the work stoppages.

“We anticipate this to have a negative impact on the results of the next fiscal year, even after the strike ends, as business activities will take time to normalize due to the concentration of productions and theatrical releases,” they stated. “But in order to try to lessen the impact, we plan to engage in cost control and other measures.”

AMC Entertainment pleaded with the parties to come to an agreement earlier in the day, before the arrangement was revealed on Wednesday night.

On August 9, 2023, Writers Guild of America (WGA) and Screen Actors Guild members in Los Angeles, California, walk the picket line outside Fox Studios. Actors joined writers on the picket lines in mid-July, after authors stopped writing 100 days ago, bringing film and television production to a complete stop.

“Many collateral damages have resulted from and will continue to result from these extended work stoppages,” the company stated in its earnings release following the bell. Following the announcement of the results and the company’s intention to sell additional shares through a secondary offering, AMC’s stock dropped by almost 10% on Thursday morning.

CEO Adam Aron predicted that in 2024, “the short-term impacts of the Writer’s and Actor’s strikes will cause additional and unnecessary challenges for AMC.”

In the upcoming quarter, Taylor Swift and Beyoncé might prove to be AMC’s saviors. While Beyoncé’s concert video isn’t out until December, Swift’s has made a lot of money.

A few films were slated to come out of the fourth quarter due to the writers’ and actors’ strikes. During a conference call with analysts, Aron mentioned that there were some gaps in the calendar during the fourth quarter. “The unexpected addition of two concert films, one starring Beyoncé Knowles-Carter and the other featuring Taylor Swift, to the fourth quarter schedule was a welcome surprise for the theater owners who rolled over; they were added a mere month or two before the quarter started.”

Next up is Warner Bros. Discovery, a media behemoth whose shares plummeted on Wednesday subsequent to its results announcement.

During the results call, CFO Gunnar Wiedenfels stated that the Hollywood strikes had a negative impact on the studios’ business, especially in terms of television. He said that despite high box office and video game results, the strikes negatively impacted “TV content delivery and production as TV revenues declined significantly.”

Further, he issued a warning, stating that there is “a real risk that some negative financial impact of the strike will extend into 2024 to some extent at this point.”

Although The Hollywood Actors’ Strike Is Resolved, Several Large Firms Will Still Be Affected

The impact of the strike on the company has, thus far, “been negligible,” Disney CEO Bob Iger told CNBC’s Julia Boorstin prior to the actors’ union and studios reaching a labor agreement on Wednesday night.

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