Summary
Discovery, Inc. (WBD) reported a decrease in total revenues for the three and six months ended June 30, 2020, compared to the prior year, largely impacted by a significant decline in advertising revenue due to the COVID-19 pandemic. Distribution revenue showed modest growth. The company experienced a notable decrease in net income available to Discovery, Inc., primarily driven by reduced revenues and increased expenses, including a $36 million goodwill impairment charge for its Asia-Pacific reporting unit. Despite these challenges, Discovery maintained a strong cash position and managed its debt effectively, including issuing new senior notes and repaying outstanding balances. The company is actively managing costs and exploring innovative strategies to navigate the ongoing economic uncertainties caused by the pandemic.
Financial Highlights
46 data points| Revenue | $2.54B |
| Cost of Revenue | $810.00M |
| Gross Profit | $1.73B |
| SG&A Expenses | $635.00M |
| Operating Expenses | $1.82B |
| Operating Income | $717.00M |
| Interest Expense | $161.00M |
| Net Income | $271.00M |
Key Highlights
- 1Total revenues for the three months ended June 30, 2020, decreased by 12% to $2.54 billion from $2.89 billion in the prior year, primarily due to a 21% drop in advertising revenue. For the six months ended June 30, 2020, total revenues decreased by 7% to $5.22 billion.
- 2Net income available to Discovery, Inc. declined significantly, falling 71% to $271 million for the three months ended June 30, 2020, and 51% to $648 million for the six months ended June 30, 2020, compared to the prior year periods.
- 3The company recorded a $36 million goodwill impairment charge related to its Asia-Pacific reporting unit due to the impact of COVID-19.
- 4Distribution revenue showed resilience, increasing by 2% for the three months and 1% for the six months ended June 30, 2020, driven by growth in U.S. Networks.
- 5Discovery proactively managed its liquidity, drawing $500 million from its revolving credit facility in March 2020 (later repaid), and issuing $2 billion in Senior Notes in May 2020 to fund tender offers and repay debt.
- 6Operating income decreased by 21% for the three months and 11% for the six months ended June 30, 2020, reflecting the revenue decline and certain expense increases.
- 7The company incurred a $71 million loss on extinguishment of debt related to the repurchase of senior notes in the second quarter of 2020.