AMC Networks to cut content spend by 20% in 2023

Fear The Walking Dead

AMC Networks is planning to cut its content spending by around 20% this year, down to $1.1bn from $1.35bn in 2022.

The reduction, of around $250m, brings content spend back down to pre-pandemic levels, with AMC having averaged around $1bn per years between 2017 and 2019.

Speaking on the company’s Q4 earnings call, CFO Patrick O’Connell told investors that AMC was still left with “plenty of firepower” to continue producing “an amazing set of shows” despite the cutback.

“I think the punchline here is that, we’re trying to strike the right balance between continued investment in the business and generating sufficient sort of profits and cash flow in the near-term,” said O’Connell.

Earlier in the call, the CFO said that 2023 will be a “key year” for AMC Networks as it seeks to be “everything to someone, rather than offering something for everyone” and pointed to its expanding franchises, the Anne Rice Immortal Universe and The Walking Dead Universe, as part of this strategy.

AMC’s net revenues increased 20% from the prior year to $965m, up from $804m in the same quarter in 2021, while net revenues for the full year increased 1% from the prior year up to $3.1bn. Meanwhile, streaming revenues increased 35% over the full year to $502m, with the company reporting 11.8 million subscribers as of the close of 2022.

The decision to reduce content spend comes ahead of Kristin Dolan, board member and wife of company owner James Dolan, taking over as CEO at AMC Networks on 27 February.

She takes the reins during a challenging time for AMC Networks, which announced plans to cut around a fifth of its US workforce and implement “significant cutbacks in operations, at the end of last year.

The company, which operates flagship AMC network and Sundance TV, as well as platforms AMC+, Acorn TV, Shudder, Sundance Now, ALLBLK and HIDIVE, has struggled to make the move into streaming and is facing pressure from stalling subscriber growth.

Shows such as Demascus, Moonhaven and Pantheon have been dropped, with Dan McDermott, AMC Networks’ president of entertainment and AMC Studios, recently calling the content cuts a “difficult but important process” and said that the US firm must “take stock and recalibrate”.