By many measures, Warner Bros. Discovery had a bad 2024. Revenue dropped 4.8% to $39.3 billion. The company posted a staggering $11.5 billion net loss, largely because of a $9.1 billion goodwill impairment charge that reflected the lower valuation of its linear TV networks. WBD’s stock fell around 7% for the year.
But Warner Bros. Discovery rewarded president and CEO David Zaslav with a 4.4% pay bump, to total compensation of $51.9 million last year, including a cash bonus of $23.9 million and $23.1 million in performance-based restricted stock grants. According to WBD, Zaslav was deemed eligible for a 108.6% payout of his 2024 cash bonus target — and 200% of the target for his stock grants.
How exactly did Zaslav get a pay hike amid Warner Bros. Discovery’s financial decline?
As noted, WBD’s revenue declined in 2024 and came in below the “100% payout” threshold of $40.4 billion set by the compensation committee for Zaslav to be eligible for that portion of the cash bonus. But a larger component in calculating his bonus was adjusted EBITDA, which was $9.032 billion for 2024 — down 11% year over year, but still over the $9 billion threshold for 100% payout used in determining the CEO’s bonus. In addition, WBD ended the year with 116.9 million streaming subs, beating the 112.9 million target for a 125% bonus payout.
Meanwhile, the strategic goals that factored into Zaslav’s bonus were more qualitative. For example, one of those goals for Zaslav was to “Complete integration pipeline; Implement cost controls to adjust cost to serve in declining linear [TV] revenue environment.” On this front, Zaslav “Achieved incremental cost savings of $1.8B in 2024, significantly overdelivering against internal goal,” according to the WBD compensation committee. (Those savings were achieved in part through major layoffs.) The committee determined Zaslav had met the outlined strategic goals at 115% of his target.
Zaslav’s 2024 stock grants, valued at $23.1 million, were part of WBD’s long-term incentive compensation program. “We believe that delivering a substantial portion of an executive’s total direct compensation in equity awards helps to align our executives’ interests with those of our stockholders,” the board’s comp committee explained.
The stock grants Zaslav received last year were not based on total stockholder return (i.e., change in stock price over time). Instead, those were based based 75% on “individual strategic goals” similar to the ones used to calculate his cash bonus; one example there was that Zaslav “Led successful rebound of WBTV from strike, delivering increased episodes in 2024 (as compared to 2023).”