Monday’s news that Warner Bros Discovery is splitting into two companies – one consisting of studios and streaming, the other linear TV networks – has cued up Hollywood’s latest succession drama.
David Zaslav, having steered WBD as CEO since the 2022 close of the $43 billion merger of Discovery (which he formerly ran) and WarnerMedia, is slated to be CEO of the “S&S” (Studios & Streamers) entity. Gunnar Wiedenfels, Warner Bros Discovery‘s CFO, who held the same post at Discovery and has a pure finance background, has been installed as CEO of the Global Networks company.
The breakup is expected to formally close by the second half of 2026, and already a host of questions are swirling about the long-anticipated maneuver. Among them: Who will sit in the corner office when all is said and done?
For each of new company, M&A could provide that answer. During a call with Wall Street analysts about the transaction, Zaslav said the split “reflects our belief that each company can now go further and faster apart than they can together.” Wiedenfels said both companies will be “free and clear” for dealmaking as soon as the split is complete – with no waiting period, unlike when a two-year pause was mandated after WarnerMedia and Discovery combined.
While Wiedenfels is respected in finance circles, his new gig overseeing the networks company “would seem to suggest a focus on financial efficiency and potentially a strategic transaction at some point,” TD Cowen analyst Doug Creutz wrote in a note to clients. Guggenheim’s Michael Morris also highlighted the appointment, waggishly anointing Wiedenfels “Top Gunnar.”
Prior to Discovery, the German-born Wiedenfels held finance posts at ProSiebenSat and worked in Hamburg for McKinsey & Co. While he never became the pop-culture villain that Zaslav did, especially among genre fans, he nonetheless managed to provoke the creative community in 2022 by dismissing concerns about the scrapping of a Batgirl movie in order to realize a tax benefit. “Media likes to talk about media, I guess,” he shrugged at the time.
Bumping up the CFO to CEO is a different approach from the one taken by Comcast in assembling the management team for Versant, the NBCUniversal cable network holding company about to spin off from Comcast. Mark Lazarus, the prospective CEO, brings significant operational and programming experience to the role, having headed sports and entertainment across linear networks and streaming. Occasionally, CFOs do ascend to the top job in media companies (Chris Winfrey at Charter Communications is one current example), but it’s a tougher road in organizations entrenched in Hollywood.
The S&S company is even more of a house of intrigue, not surprisingly given that it has prestige assets like HBO, HBO Max and Warner Bros under its roof. While Zaslav has long coveted movie-mogul status, punctuating that ambition by moving into late Paramount boss Robert Evans’ former L.A. home, he has also committed a number of unforced errors. Along with authorize the killing of movies like the completed Coyote vs. Acme (which was recently sold after an outcry), he came close to torpedoing Turner Classic Movies. Steven Spielberg, Martin Scorsese and a coalition of other A-list filmmakers convinced him otherwise. And there was that bash he and Graydon Carter threw in Cannes during the 2023 Hollywood writers strike, complete with heavy security.
One senior exec who worked for Zaslav at Discovery and WarnerMedia told Deadline the split plan had a certain valedictory quality. “It feels like this is the start of his retirement, at least from this company,” the exec theorized. “Would he want to run something that’s so much smaller than what he had before?” At 65, Zaslav would appear to have another act in him, but some insiders point to his recalling of longtime lieutenant David Leavy last month from CNN to a senior post at the mother ship was a precursor.
If Zaslav were to ever step away (a big if for anyone tuning in to NBA or French Open telecasts over the past month, where Zaslav’s embrace of celebrities was on full display), who would be candidates to be No. 1? Two names on the short list would be Casey Bloys and Channing Dungey.
Both had prominent roles at the company’s upfront presentation to advertisers last month in New York. Bloys also earned unusually fulsome praise from Zaslav on WBD’s most recent quarterly earnings call. The top exec called the HBO and Max content chief “a generational talent” and said HBO’s current state is not only healthy but the equal to NBC programming during the fabled “Must-See TV” era.
Dungey, meanwhile, sought to pre-empt any speculation that she could leave the fold by sending an internal memo asserting the opposite. “I’m thrilled that I will continue to have the privilege of leading WBTVG,” the chairman and CEO of Warner Bros Television Group and U.S. Networks wrote.
For Wall Street, there are some bigger clouds on the horizon than the haze-covered org chart.
“The broader question is: Why now?” wondered MoffettNathanson analyst Robert Fishman in a note to clients. “While we are not shocked that the company chose to split up, the timing of the move is more surprising. The announcement raises questions about external pressures. We note the move follows closely on the heels of S&P’s recent downgrade of WBD’s debt to below investment grade. WBD’s depressed stock price likely also played a role, possibly creating urgency around re-rating the equity story through structural change. Regardless of the precise catalyst, we now must wait formal separation documents and more clarity on capital structure.”
Investors grew chilly on the deal as Monday’s trading day reached its end. After initially roaring up more than 9%, WBD’s already-battered stock fell another 2% to close at $9.77.
