Chief executives like to philosophize—it’s one of the ways that the art of corporate governance, strategic investment, and financial sponge-wringing ascends to a higher art form. David Zaslav, for instance, occasionally likens his leadership of Warner Bros. Discovery to the painting of an enormous fresco. In private conversations with friends, he uses this analogy to emphasize the massive time and effort required to combine two disparate legacy media assets, restructure the business, and generate cash flow, and also to dismiss what he sees as the myopia of his critics. In Zaz’s telling, his detractors in Hollywood, the press, and on Wall Street are too worried about the inevitable plaster falling on the floor—layoffs, Batgirl, the TCM cuts, etcetera—to recognize the efficient, cash-flow-positive economic masterpiece (in support of Barbie and White Lotus, among others) that he is creating above them.
A year and a half in, of course, the critics are now starting to wonder how well this so-called turnaround artist knows how to paint. WBD remains saddled with a colossal $43 billion net debt load, its stock is down nearly 57 percent since the merger, and, fairly or unfairly, Zaslav has become a convenient caricature for the various pitfalls of legacy media businesses. The New York Times Magazine’s new, triple-bylined opus on Zaslav, which arrived on Wednesday, portrays Zaz as a ruthless cost-cutter and “out-of-touch and overpaid corporate C.E.O.” who fundamentally misjudged the demands and sensitivities of modern Hollywood. In short, there’s a lot of plaster.
Undeniably, Zaslav has exhausted his goodwill with many in Hollywood, save for a close circle of well-heeled media veterans quoted in the Times piece, and even they—Barry Diller, Ken Lerer, etcetera—seem to recognize the scale of his public relations predicament. And of course, there is no one Zaz has alienated more than his shareholders. Last week’s earnings report, which sent WBD stock plummeting by 19 percent, showcased the utter lack of faith everyone seems to have in Zaz’s ability to turn economic efficiency into shareholder value. Or, put another way, Zaz has demonstrated proficiency and discipline with P&L maintenance, but he has yet to boost the EBITDA.