As Warner Bros. confirmed in its latest annual report, the commercial failure of “Suicide Squad: Kill the Justice League” led to a collapse in sales in the gaming division in the past quarter. At the same time, the company announced that it wanted to license well-known brands to external studios.
By now it should have gotten around that the “Batman: Arkham” makers at Rocksteady had a gaming and commercial failure with “Suicide Squad: Kill the Justice League”.
After the second season also failed to have a positive impact on player numbers, Warner Bros. Discovery officially called it a flop in its latest annual report. The disappointing performance of “Suicide Squad: Kill the Justice League” in the past quarter caused WB Games’ sales to fall by 41 percent compared to the same period last year.
A development that is not only due to the failure of “Suicide Squad”. In addition, WB Games continued to benefit from the success of “Hogwarts Legacy” in the same quarter last year.
Entire group records billions in losses
But it’s not just the gaming division that’s been in crisis recently. The last quarter also ended with an unpleasant result for the entire group. Warner Bros. Discovery reported sales of 9.7 billion US dollars. However, it recorded a total net loss of ten billion US dollars.
According to Warner Bros., $9.1 billion of the net loss is due to impairments. WB officially justified the write-down with “the difference between market capitalization and book value, the continued weakness of the U.S. linear advertising market and the uncertainty related to the renewal of partner and sports rights, including the NBA.”
Another topic that was discussed at a conference on the occasion of the business figures is the strategic use of video games. After all, Warner Bros. Discovery has various valuable brands such as “Batman,” “Justice League,” “Harry Potter,” “Looney Tunes” and “Game of Thrones,” but apart from “Hogwarts Legacy,” these have recently generated only modest sales.
A new licensing model for the most important brands
Despite WB Games’ disappointing performance last quarter, Warner Bros. Discovery CEO David Zaslav and JB Perrette, president of global streaming and gaming, continue to see video games as a core part of the portfolio. Both Zaslav and Perrette said they want to expand their gaming business.
This is especially true for the free-to-play market, which Perrette believes can help smooth out some of the ups and downs of the cyclical console industry. The media company recently took the first step in this direction with its acquisition of Player First Games.
It goes on to say that Warner Bros. Discovery will not rely solely on its internal studios for its games strategy. At the same time, the group is examining a licensing model to publish video games based on its own brands in collaboration with external studios. “We have eleven studios here and a lot of intellectual property,” so Zaslav.
“And there’s also a lot of interest from others to use some of that IP for gaming, which we’re looking at. Because like JB said. We need to get bigger and the IP that we own and the value that it has in the gaming space is something we want to leverage.”
Warner Bros. Discovery plans to provide further details on this strategy at a later date.
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