Investors in media stocks eagerly awaited news of a potential resolution to the ongoing Hollywood writers strike. The negotiating committee of the Writers Guild of America (WGA) announced that it had met with the Alliance of Motion Picture and Television Producers (AMPTP) for bargaining on Thursday, with talks set to continue on Friday. Reports on CNBC suggested that both sides were close to reaching an agreement.
Reacting to the news, shares of Paramount Global (PARA) initially rose but were down 0.6% at the market opening on Friday. Netflix (NFLX) also saw a 0.3% dip in its stock value, while Walt Disney (DIS) shares remained unchanged. On the other hand, Amazon (AMZN) stock experienced a 1.5% increase. Warner Bros. Discovery (WBD) and Comcast (CMCSA) were not as lucky, with their stocks down 1.6% and 0.4% respectively.
The strike, which began in early May by the WGA, significantly impacted the entertainment industry. While some filming continued without writers, the situation worsened in July when the union representing Hollywood screen actors joined the strike. There has been no comment from the Screen Actors Guild regarding progress in negotiations between writers and studios.
As the strike continues, Hollywood studios have managed to reduce costs but are now facing lower earnings expectations, especially for TV production-focused companies like Warner Bros. Discovery. In response to strike-related delays, studios have been forced to make adjustments to their film schedules.