Warner Bros. Discovery (WBD) -) shares moved firmly higher Monday, leading solid gains for rival media stocks, after Hollywood writers reached a tentative agreement on pay and profit sharing that could end their months-long strike on studios in the entertainment capital.
The deal, if ratified by the Writers Guild of America and its union members, would end a writers' strike that began in May and has crippled studio production heading into the final months of the year. The Guild called the deal "exceptional" and praised the enduring solidarity of WGA members and extraordinary support of our union siblings who joined us on the picket lines for over 146 days.'
The Screen Actors Guild, however, as well as the American Federation of Television and Radio Artists, collectively known as SAG-AFTRA, remain on strike after joining the Writers' picket line in early July.
"We can say, with great pride, that this deal is exceptional — with meaningful gains and protections for writers in every sector of the membership,” the Writers' Guild said in a statement.
Warner Bros trimmed its full year earnings forecast earlier this month, and now sees adjusted earnings of between $10.5 billion and $11 billion, as a result of the strikes, which which it had forecast to end in September, would likely rise to between $300 million and $500 million by the end of the year.
Late last month, the group's studio division said it would delay the release of its "Dune: Part Two" sequel, originally set for November, until at least March of next year following a warning from CEO David Zaslav that the industry is in "unchartered waters" as a result of the industrial action at the heart of the global movie industry.
Warner Bros. Discovery shares were marked 4% higher in pre-market trading to indicate an opening bell price of $11.10 each. Paramount Global (PARA) -) shares, meanwhile, were marked 3.2% higher at $12.64 each.
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