Warner Bros. Discovery on DC Films Course Correction: "These Are Difficult Decisions"

Warner Bros. Discovery has addressed the "difficult decision" to scrap straight-to-HBO Max movies Batgirl and Wonder Twins, two DC Comics adaptations canceled under CEO David Zaslav. During WBD's second-quarter earnings report Thursday, Zaslav spoke on the merged company's "strategic shift" away from expensive, direct-to-streaming movies, reaffirming a commitment to theatrical exhibition and the exclusive theatrical window. Under this focus on theatrical, Warner Bros. Discovery's ambition is to produce "great, high-quality" movies for theaters, Zaslav said, pivoting to big-budgeted DC movies with blockbuster potential, including The Flash and the upcoming Dwayne Johnson-starring Black Adam. 

Warner Bros. Discovery "did not find sufficient support" for what the company called "substantial investments in direct-to-HBO Max films," Andrew Slabin, Executive Vice President, Global Investor Strategy, said on the call. "This means adjusting the way we invest going forward and also evaluating both projects already completed or in progress."

Slabin added: "Wonder Twins, Batgirl, and Scoob! Holiday Haunt are examples of streaming films that do not fit this new strategic approach. These are difficult decisions. We are committed to being disciplined about a framework that guides our constant investment for maximum returns." 

This week, the company confirmed it shelved the nearly-finished live-action Batman spinoff, starring Leslie Grace as Barbara Gordon/Batgirl, and the animated straight-to-streaming Scoob! sequel. It was reported that the newly formed company would take a tax write-down, which would prohibit the scrapped films from ever being released on any platform. 

"The Warner Brothers Motion Picture Group has fantastic IP and great history... Between DC, the [Warner] Animation Group, together with the entire Warner library, our ambition is to bring Warner back and to produce great, high-quality films," Zaslav said during the call. "And as we look at the opportunities that we have broadly, DC is on the top of the list for us." 

Zaslav added that DC's new owners have "done a reset" and "restructured the business" as part of a 10-year plan akin to the Kevin Feige-led Marvel Studios at Disney.

"We think that we could build a long-term much stronger, sustainable growth business out of DC. And as part of that, we're going to focus on quality," Zaslav said. "We're not going to release any film before it's ready. We're not going to release a film to make a [financial] quarter, we're not going to release a film [until it's ready]. The focus is going to be, how do we make each of these films in general as good as possible?"

Zaslav added: "DC is something that we think we could make better, and we're focused on it now."