AMC Is Losing A Ridiculous Amount Of Money After Layoffs
AMC restructuring costs after layoffs could cost the company upwards of $475 million.
AMC Networks expects restructuring charges of $350 million to $475 million, due to cord-cutting, economic factors, and related impacts across the media industry. Those figures include the previously announced layoffs, along with hundreds of millions of dollars in write-downs related to television programming. The company disclosed the information in a securities filing on December 1st, The Hollywood Reporter says.
The estimated loss includes organizational and severance costs of $50 million to $75 million, reflecting retrenchments at the company. The layoffs, which affect 20% (200 people) of AMC staff in the United States, include David Stefanou, Senior Vice President of Original Programming and Development for WE TV. He led the development team in creating shows like Love After Lockup.
Marco Bresaz, Senior Vice President of non-fiction and alternative programming for AMC and Sundance TV will also be axed. He helped oversee original non-fiction programming development across both networks, as well as their portfolio of current non-fiction programming. Other departures include Rafael Ruthchild, Vice President of Scripted Programming for AMC and Sundance.
Cassie Conaway, Director of Scripted Programming at AMC Studios at AMC Networks will also be let go, along with Laura Luckenbaugh, Director, of International Programming and Development for AMC Networks. Additionally, the restructuring will bring about strategic programming assessments leading to content charges of approximately $300 million to $400 million.
While it’s still unclear which titles are impacted by the write-down, the programming assessments pertain to a broad mix of owned and licensed content. This includes legacy television series and films that will no longer be in active rotation on the company’s linear or digital platforms. “The company may realize some future licensing and other revenue associated with some of the owned titles,” it added.
AMC explained that its restructuring plan is ongoing and may lead to more strategic assessments of programming that could result in additional costs. However, the current reshuffle is expected to be completed by the end of 2023. The network has had a rough week, with newly appointed CEO Christina Spade exiting the company after just three months
Chairman Jim Dolan also warned staffers that large-scale layoffs were imminent. “We are primarily a content company and the mechanisms for the monetization of content are in disarray,” he wrote. “We realize that this will cause significant concern and anxiety for our employees and those who rely on AMC for their livelihood.”
He also said that the company does not take the decision lightly and is planning steps to minimize the impact on the community. Following the various announcements from AMC, the company’s shares closed down 5.3% in trading, after being off as much as 10.6% earlier in the session. This is partly due to the lack of rationale given for the CEO’s exit.
As a result, investors were left to reach their own conclusions about Christina Spade leaving, which could be personal or operations-related. The AMC news comes amid a difficult time for the media industry. Several companies are currently navigating cord-cutting pressures on their traditional operations and the shift toward streaming.