WB Games cuts internal studio as response of Warner Bros. Discovery Q4 2024 performance

WarnerMedia, now part of Warner Bros. Discovery, recently released its earnings report for the fourth quarter of 2024. The report highlighted both achievements and challenges faced by the media giant. While the company saw growth in some areas, it also had to make tough decisions, particularly within its gaming division.

Warner Bros. Discovery reported a fiscal fourth-quarter revenue of $10.03 billion, a slight decline of 1% year-over-year. The company’s net loss widened to $494 million from $400 million the previous year. Despite these setbacks, the company’s studios segment saw a 16% increase in revenue, reaching $3.66 billion. This growth was driven by an increase in TV revenue, although it was offset by declines in theatrical and games revenue.

The direct-to-consumer (DTC) segment also showed positive results, with total DTC subscribers increasing to 116.9 million from 110.5 million a year ago. The company aims to reach 150 million subscribers by 2026.

WB Games: Studio Closures and Cancellations

One of the most significant and unfortunate developments in the earnings report was the announcement of multiple studio closures within WB Games. The company decided to shut down three studios: Monolith Productions, Player First Games, and WB San Diego. This decision was part of a strategic shift to focus on fewer but bigger franchises, such as Harry Potter, Mortal Kombat, DC, and Game of Thrones.

Monolith Productions, known for its critically acclaimed Middle-earth series, was working on a highly anticipated Wonder Woman game. Unfortunately, the game has been canceled as part of the studio’s closure. The Wonder Woman game was expected to be an open-world action-adventure title featuring the iconic DC character, but it faced numerous development challenges and was still years away from release.

Player First Games, the studio behind the platform fighter MultiVersus, and WB San Diego, which focused on mobile games, were also affected by the closures. The decision to shut down these studios was not a reflection of the talent within them but rather a strategic move to allocate resources more effectively.

Impact on the Gaming Industry

The closure of these studios and the cancellation of the Wonder Woman game have sent shockwaves through the gaming industry. Monolith Productions, in particular, had a storied history of delivering high-quality games, and its closure marks the end of an era. The decision to focus on fewer but bigger franchises may help Warner Bros. Discovery streamline its operations and improve profitability, but it also means that fans will miss out on potentially groundbreaking games.

Warner Bros. Discovery’s earnings report underscores the challenges and opportunities facing the company. While the financial performance showed some positive trends, the tough decisions within WB Games highlight the difficulties of navigating the competitive gaming industry. As the company moves forward, it will need to balance its strategic priorities with the expectations of its fans and stakeholders.