Business

Time Warner targets cost cuts after spurning Fox bid

Time Warner CEO Jeff Bewkes isn’t done shrinking the media giant.

The New York company, which spurned an $80 billion takeover offer from Rupert Mudoch’s 21st Century Fox, is planning layoffs and other cost-cutting measures in the coming months.

Time Warner plans “to undertake restructuring activities to streamline its operations and allocate resources to the company’s strategic priorities,” it said in a filing Wednesday.

Bewkes has been paring back the company since taking the reins in 2008, including spinning out AOL and Time Warner Cable. Most recently, the company split off its Time Inc. magazines.

Time Warner execs suggested Wednesday during a call with analysts to discuss second-quarter results that the its Turner cable-TV division would be subject to the latest round of belt-tightening.

A plan to overhaul Turner will “likely result in restructuring charges,” Chief Financial Officer Howard Averill said.

In June, Turner CEO John Martin sent an internal memo outlining his strategic vision, called Turner 2020, and alluding to “staff changes.”

Time Warner, which houses pay-TV channel HBO and the Warner Bros. film studio, reported better-than-expected quarterly results a day after Fox officially withdrew its $85-a-share offer, saying Time Warner refused to come to the bargaining table.

Profit from continuing operations rose to $843 million, or 94 cents a share, from $698 million, or 73 cents, a year earlier.

On an adjusted basis, it reported 98 cents a share, topping analysts’ expectations for 84 cents.

Revenue climbed to $6.79 billion from $6.61 billion.

Despite the strong results, Time Warner shares plunged a day after Fox withdrew its offer. The stock fell 12.9 percent, or $10.95, to close at $74.24 on Wednesday.

In the call with analysts, Bewkes refused to discuss the Fox bid but insisted the company is better on its own. He reiterated that scaling back the company and focusing on programming and other content was paying off.

Revenue from HBO — the company’s crown jewel — rose 17 percent to $1.42 billion in the quarter, boosted by hits such as “Game of Thrones.” The show’s fourth season was the highest original series in HBO’s history, averaging 19 million viewers.

Ears pricked up when Bewkes said that HBO was building a technology team to ramp up HBO GO and other online video streaming efforts, possibly by partnering with other programming providers.

“We’re trying to be best in class and have a platform that wouldn’t only deliver HBO but some Turner networks and, frankly, other networks,” he said. “It doesn’t have to be ones that we own.”

“Global growth and interconnected devices are increasing the value of high-quality video content,” he added.