David Zaslav, the chief executive of Warner Bros. Discovery, received $49.7 million in compensation last year, a 26 percent increase from the previous year, according to a proxy statement filed on Friday with the Securities and Exchange Commission.
It is common for chief executives in media to receive lavish pay packages. Mr. Zaslav’s compensation for 2023 is notable, however, because Warner Bros. Discovery is not exactly a portrait of health. Losses totaled $3 billion in 2023, which was actually an improvement from $7 billion in losses the year before. Revenue fell 4 percent, largely because of the company’s atrophying cable television business, which includes CNN.
In addition, Warner Bros. Discovery shareholders sent a clear message about Mr. Zaslav’s pay at the company’s most recent annual meeting: It’s too high.
In a nonbinding “say on pay” vote, only 50.8 percent of shareholders approved of the $39.3 million he was paid in 2022. Approval by less than 70 percent is considered “low support” by ISS, a leading corporate governance firm.
For 2023, the Warner Bros. Discovery board adjusted compensation formulas for its top executives. The adjustment involved certain bonuses — tying them more to the generation of free cash flow, which is helpful in paying down debt, and less to the company’s stock price. (Shares have lately traded at about $8, down from $24 two years ago.)
In terms of free cash flow, Warner Bros. Discovery had a spectacular 2023. Free cash flow totaled $6.2 billion, an 86 percent increase from the year before, vastly more than Wall Street had expected. That was partly a result of improved financials at the company’s streaming division, which became profitable.
