Josh Mackenzie Lucas Shaw Someone just needs to put Paramount+ out of its misery altogether.

Josh Mackenzie Good points - DTC being profitable this q probably is a stretch for those reasons; hoping March Madness helped funnel decent subs domestically and an even stronger uptick in CTV ad rev in relation.

Josh Mackenzie Puck Jon Kelly Peter Hamby Right, I do agree that the sentiment will be much less dramatic if they can continue doing the NBA deal.

It's likely a much simpler time to negotiate terms with the NBA with the cable company.

NBA needs WBD too, if they kill WBD, no more competition for their content.

Josh Mackenzie Puck Jon Kelly Peter Hamby Agree the Netflix route is nice, and making tons more of $200M+ series is the way forward.

It is under apprecaited that the cable companies' customers do care about sports, and JV w/ Disney + Fox + WBD can incrementally offset cost.

Either way, not a big deal to get the NBA.

Rich Greenfield, LightShed 🔦 Three CEOs? The new strategy is off to a great start 😂

Josh Mackenzie Also targeting that $9-10b fcf. I really want to see closer to $11b adjst. EBITDA so they can get that net leverage to 3.5x end of FY24, but obviously really really need DTC profitability to accelerate in q3 and q4 to do it, as I am same with you on network/linear decline. Going…

Masa Capital What does Paramount do differently if they remain a standalone company?

Ryan🔋 I’ve got $10B FCF between 2024/2025 (including asset sales).

Josh Mackenzie Yes, I re-read the q4'23 transcript last night, I kind of agree as to why why Gunnar is not giving guidance... for instance, what is happening with NBA rights. Was really hoping Studio's other segments pulled a bit more weight so we didn't get hit with misses. But at least me saw…

Josh Mackenzie Yes, sorry, meant the NBA rights is kind of an example although not the reason for wanting dodging guidance, probably not a good example, but I get what Gunnar is saying here: 'We have deliberately not given a more specific target here because we will not be in a situation where…

Ryan🔋 NBA won’t impact WBD until 2026. Personally I think they should let it go at the rumored prices. On DTC I’m looking for 10mm net subs a year and global ARPU at $10 by 2026. If they can get there and turn a 20% margin they can ride networks to zero with studios at $2.75B EBITDA

Lucas Shaw These are businesses not charities. If Hollywood was making money this wouldn’t be an issue. No matter who owns Paramount there is going to be a massive restructuring of operations

Matthew Belloni Of course they won’t put their money where their mouth is 😂 If Ellison wants Paramount so badly just match the Sony/Apollo offer, this isn’t that difficult.

Lucas Shaw Very good. Paramount+ needs to hike pricing as well.

Ryan🔋 Very strong DTC, with growth in domestic subs! DTC is going to need to contribute more on the revenue/ebitdax side with networks declining 10% annually. Need sub growth + rising ARPU (international in particular). FCF is great but still no 2024 guidance which is concerning.

Will Sun Puck Jon Kelly Peter Hamby They should exit 2025 with $1B+ DTC EBITDAX and growing quickly. Sub $30B net debt. At this point the linear networks business could be cut 70%+ and they will be fine.

Ryan🔋 Hopeful for ~2mm net adds on DTC. Remember that there is usually some slippage with rolling out Max in new territories. They also need to offset linear HBO losses. Still, I think DTC has a strong quarter but I wouldn’t expect profitability due to costs with LATAM and EU prep.

Callum 🏴󠁧󠁢󠁥󠁮󠁧󠁿 🇺🇦 Alex Sherman Proposed pricing would be a disaster for WBD. There is still no evidence that sports are a primary driver of streaming success. If linear bundle collapses (which it very well could) it would bankrupt the company. Can’t take that risk.

Will Sun Puck Jon Kelly Peter Hamby It’s all about the opportunity cost. DTC gets capitalized at 20x EBITDAX. Networks at 3x-4x. There is lots of data that shows sports simply are not a large driver of DTC adoption. WBD can make 12! $200mm series a year for the cost of NBA. GOT, Harry Potter, DC, new IP etc.