Credit: YouTube/Rotten Tomatoes TV

The CEO of Warner Bros. Discovery, David Zaslav, just revealed that HBO lost a massive amount of money caused by a blown-out content budget last year in 2021. The CEO and president of the recently merged Warner Bros. Discovery said that HBO lost $3 billion in 2021. He said the company failed to earn back a large sum spent on content, reported Deadline. The news comes after HBO decided to send some of its original content to the guillotine, with massive losses being attributed to the animation department.

Zaslav talked about the difficulties the company has been facing since the Warner Bros. Discovery merger that contributed to the HBO loss during a keynote presentation at the RBC Media conference. The difficulties mentioned included a need to rethink the streaming models. He said that HBO can get 30 million people with Euphoria, but they only watch for two months and split after finishing the show. So maybe HBO needs to incentivize viewers to stick around for longer to avoid further losses.

Credit: HBO via LA Times

HBO’s $3 Billion loss

Talking about HBO’s finances, he said that he has never seen anything like the $3 billion loss. He went on to explain that HBO spent $2.5 billion in 2019 and made a profit of the same amount. But in 2021, it spent a shocking $7 billion, which then resulted in a loss of $3 billion. While discussing the loss, Zaslav pointed out that all those movies that went directly to streaming were thrown “right on top of HBO Max.”

This massive loss has resulted in HBO opting for some cost-cutting measures, which have caused a huge amount of content to be removed from HBO Max. The leadership has apparently considered the possibility of selling some of the intellectual properties to other streaming services, as well as selling non-exclusive rights to original content that no one really watches or isn’t the reason for the subscription.