Warner Bros. set to report earnings Thursday amid layoffs and 'Batgirl' cancellation

Yahoo Finance reporter Allie Canal previews what to expect from Warner Bros. Discovery's upcoming earnings results.

Video Transcript

SEANA SMITH: All right, well, HBO Max is reportedly expected to lay off around 70% of its development staff. Now, The Wrap reporting the announcement is expected to come from Warner Brothers Discovery CEO David Zaslav tomorrow when the company reports its quarterly earnings. Alexandra Canal is following this story for us. Allie, what can you tell us?

ALEXANDRA CANAL: Hi, Seana. Yeah, you're right, that report from The Wrap, it's fueling speculation about the future of HBO Max. There are rumors that it could be merging with Discovery+. And certainly, with the job cuts-- the reported job cuts, I should say-- being on the development side on that content creation side, could that mean the end of original programming on HBO Max?

On top of that, earlier today, we got word that the "Batgirl" film will no longer be released by Warner Brothers. That film was expected to debut on HBO Max. The studio saying in a statement that the decision reflects, quote, "our leadership's strategic shift as it relates to the DC Universe and HBO Max." In addition to the "Batgirl," Warner Brothers also pulling another film, "Scoob! Holiday Haunt."

So it's clear that Warner Bros Discovery, they're trying to cut costs every which way they can. At the time of that merger in April, the two companies did come together and said that they expect to cut $3 billion worth of costs. Maybe what we're seeing now is the start of that cost-cutting procedure playing out. Warner Bros Discovery is reporting earnings tomorrow after the bell. So hopefully, we get a little more clarity on some of this commentary, on some of these reports. In after hours trading, the stock is relatively flat. But it did close higher today above 4%.