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After a series of scandals and the resounding failure of its streaming service, CNN has seen its profits plunge almost as much as its audience, falling below $1 billion for the first time in years.
According to a New York Times (NYT) report, financial analyst firm S&P Global Market Intelligence estimates that CNN would reach about $956.8 million in 2022, marking the first drop below $1 billion since 2016.
SCOOP — CNN is on pace to dip below $1 billion in profit for the first time since 2016 amid crashing ratings, sources say:https://t.co/10Fw7iofrp
— Ben Mullin (@BenMullin) August 2, 2022
Sources close to the Times said that Chris Licht, who took over as the channel’s executive director in May following Jeff Zucker’s departure, had set a goal of reaching $1.1 billion by the end of the year. However, a 27% drop in viewership appears to have dashed his expectations.
When Licht took over, CNN had just invested millions of dollars in launching CNN+, a streaming platform that barely reached an audience of close to 10,000 subscribers. Seeking to reverse the damage, the new CEO decided to shut down the failed service, but it seems that the network is still paying the costs.
As a result, the company even had to cut its budget in multiple areas, including travel expenses, according to the NYT report. Licht further hired his personal friend and Florida real estate executive, Chris Marlin, to look for ways to increase profits.
Although he has no experience in television channels or media, Marlin heads the area of strategy and business operations and, since he was hired by CNN in May, weeks after Licht’s arrival, he began investing in advertising with large companies and is looking to expand the channel’s operations to China.
Scandals, criticism, and ratings at CNN
CNN has seen its audience fall after scandals involving its star anchor, Chris Cuomo, as well as its former CEO. Its markedly left-leaning editorial line also alienated a large part of its audience. So much so that Warner Bros. Discovery parent company CEO David Zaslav himself has said he hopes the network will return to being unbiased.
Despite the efforts Licht has put into straightening CNN’s editorial path and changing the direction of its news programming, some of its former producers think the damage Zucker did to the network could be “deep and permanent.”
A CNN spokesman said Licht also focused on expanding the network’s traditional television audience and described his recommendations to producers as “editorial guidance” rather than “business strategy,” the NYT reported.
The spokesman added that Licht has not yet weighed in on programming, although he projects the network’s profits will increase in 2023.
Meanwhile, CNN’s flagship programming, led by leftist anchor Brian Stelter and his show, ironically titled Reliable Sources, has barely reached an audience of 639,000 viewers.
However, neither layoffs nor major budget cuts would be among the plans of Licht, who is confident that moderation and a “return to real journalism” would be enough of a stimulus to bring CNN back to its golden days.
Tomás Lugo, journalist and writer. Born in Venezuela and graduated in Social Communication. Has written for international media outlets. Currently living in Colombia // Tomás Lugo, periodista y articulista. Nacido en Venezuela y graduado en Comunicación Social. Ha escrito para medios internacionales. Actualmente reside en Colombia.