In what one may say is a exceptional instance of understatement, Warner Bros. Discovery mentioned in a letter to shareholders that 2024 was “a disappointing yr” for its video games enterprise, which suffered a 53% lower in income in comparison with 2023. Regardless of that large hit, Warner has excessive hopes for 2025 because of its current restructuring, which it says will allow it to “refocus our sources and capital on confirmed IP and video games from confirmed, world class studios.”
That restructuring, in fact, noticed the current closures of WB San Diego, Participant First Video games, and the legendary Monolith Productions, in addition to the cancellation of the Surprise Lady recreation that was introduced in 2021. All of that got here within the wake of the spectacular failure of Suicide Squad: Kill the Justice League and the fizzle-out of Multiversus, which was much less overtly cataclysmic than Suicide Squad’s bomb however nonetheless notable as a result of the sport had come out so strongly, earlier than Warner determined for causes unknown to take it offline for almost a yr and rework it. Between them, the 2 video games ended up shedding roughly $300 million.
Regardless of that, Warner continues to see videogames as “a strategic differentiator,” which “permits us to faucet into one of many quickest rising media segments and the over three billion international players.” However its focus sooner or later, because it mentioned when it confirmed the closures of Monolith and the remainder, shall be on “4 tentpole franchises which have every generated over $1 billion in client gross sales in previous years: Harry Potter, Recreation of Thrones, Mortal Kombat, and DC—significantly high tier characters like Batman.”
“Simply two years in the past, our Video games group broke by with Hogwarts Legacy and created a totally new gaming franchise that was the best-selling recreation of the yr—a outcome that solely three different franchises within the final 15 years have achieved. That offers us confidence that with our re-focused technique we will get again to producing high-quality video games constructed for long run client engagement, which we count on to propel our Video games division again to revenue in 2025 and emerge as a extra vital contributor to development within the years forward.”
Warner’s been banging this explicit drum for some time now, so it isn’t as if that is some shock strategic shift that is going to catch the world off guard. But it surely does body how the corporate views videogames extra starkly than I believe we have seen previously—not as a medium of expression or leisure in its personal proper, however merely a system of help for IP that folks like or acknowledge.
It is an fascinating takeaway given the ample proof {that a} large title will not carry the day by itself: Hogwarts Legacy was an enormous hit, however Harry Potter: Quidditch Champions goes nowhere and Harry Potter: Magic Woke up was closed in October 2024, simply over a yr after it launched. I am unable to even consider a Recreation of Thrones recreation that is made a lot of a splash, other than perhaps Telltale’s 2015 journey sequence. (The subsequent GoT recreation has a demo on Steam proper now, and perhaps it’s going to go someplace.) Folks do like superheroes, although, so perhaps that’ll work out. (Simply not, y’know, Surprise Lady.)
What could assist Warner’s video games division greater than tentpoles is a current change on the high: Longtime video games chief David Haddad introduced in January that he is stepping down from the function. A current Bloomberg report cited quite a few sources who laid the blame for Warner’s videogame woes at Haddad’s ft, saying his tenure was marked by indecision and an absence of coherent imaginative and prescient.
