After a year of chaos, CNN bets on new CEO Thompson to focus on long-term viability
A person walks past the headquarters of the Cable News Network (CNN) on November 17, 2022 in Atlanta, Georgia.
Brandon Bell | Getty Images
When former CNN Chief Executive Officer Chris Licht started running the news organization last year, he had a mission from his boss, Warner Bros. Discovery CEO David Zaslav: change the network’s programming and tone to emphasize news rather than “advocacy” journalism.
With Licht now fired, CNN’s incoming CEO Mark Thompson has a new job: everything else.
Thompson, who starts at CNN on Oct. 9, has had preliminary discussions with Zaslav and other members of CNN’s leadership about strategic ideas and priorities, according to people familiar with the matter, who declined to speak on the record because the discussions were private. He has made no decisions about CNN’s operations and won’t until he has had a chance to meet with staffers and learn the business, said the people.
Still, some areas of emphasis are clear. Thompson will focus on building digital subscription businesses around CNN.com and creating programming for a younger audience on CNN Max, the network’s live news service on Warner Bros. Discovery’s “Max” streaming service, said two of the people.
Licht’s background was programming, as he launched “Morning Joe” on MSNBC and “CBS This Morning” with Charlie Rose, Norah O’Donnell, and Gayle King. Zaslav hired him as a TV programmer — and ultimately fired him after Licht lost the confidence of his employees and failed to deliver ratings winners.
Much of Licht’s short reign, which lasted a little over a year, centered around depoliticizing CNN. Zaslav and Licht agreed that CNN had gotten a reputation as left-leaning, and tried to refocus the network as a down-the-middle outlet that could appeal to both Democrats and Republicans. Licht and CNN’s leadership since his firing — a four-person team of Amy Entelis, Virginia Moseley, Eric Sherling and David Leavy — overhauled CNN’s linear shows, including a new morning show and a revamped primetime lineup.
Licht struggled to win over CNN employees by purposely taking a hands-off approach to differentiate his style from former CNN chief Jeff Zucker, who resigned in February 2022 after failing to disclose a consensual relationship with a coworker. Zaslav felt Licht moved too slowly to make decisions and didn’t appropriately relate to CNN’s talent, according to people familiar with the matter. Licht believed he couldn’t be his authentic self given Zaslav’s mandate to be a non-nonsense leader who had to reform CNN’s image and cut costs, the people said. Licht had to lay off hundreds of employees as part of a broader Warner Bros. Discovery headcount reduction.
Mark Thompson, CEO of CNN
AP
While Licht largely focused on linear programming, Thompson will concentrate on making CNN a sustainable business for the next five years — a timeline he’s already discussed with some members of CNN leadership, according to people familiar with the matter. The work to change CNN’s reputation is largely complete, according to people familiar with Warner Bros. Discovery executives’ thinking.
How to cover Donald Trump, an issue which defined Licht’s tenure, probably isn’t in Thompson’s top five priorities as he starts the job, according to a person familiar with the matter. Existing CNN executives believe they already have the infrastructure in place to appropriately handle the former president and current Republican primary candidate as the 2024 election ramps up, the person said.
Entelis, Moseley, Sherling and Leavy all plan to stay at CNN as Thompson takes over as CEO, according to people familiar with the matter. All will report to Thompson. A CNN spokesperson declined to comment on speculation about Thompson’s eventual moves and strategy.
Digital strategy
Thompson’s last job was CEO of the New York Times, which he held from 2012 to 2020. He grew the Times’ subscription digital business, which launched in 2011, from less than 1 million subscribers to about 7 million before he left the company in September 2020. During his time as the newspaper’s CEO, shares rose from $9 to about $43 — a gain of more than 375%.
CNN hasn’t had a clear digital strategy since Zaslav and Licht decided to kill off CNN+ after just a month in 2022. CNN+, at the time, was a little-watched streaming service that launched without much content. Former CNN chief Jeff Zucker and then-CNN digital chief Andrew Morse hoped it would eventually become CNN’s version of The New York Times — a subscription news product that could feature more than just video.
Thompson will still have to preside over CNN’s linear network, an entity that has declined along with the erosion of the pay-TV cable bundle. But Zaslav is counting on him to use CNN.com and its 149 million monthly unique visitors as a funnel to build digital subscription businesses, said people familiar with the matter.
One idea being discussed is to build several subscription products on specific topics within CNN.com, which would remain without a paywall, said the people. For customers who want all access, CNN could offer a bundle for a discount. Paying a monthly fee could unlock on-demand or live CNN programming on certain subjects, give users access to particular pieces of in-depth or focused journalism and provide other benefits.
Thompson may also explore ways to integrate Bleacher Report with CNN.com, just as The New York Times has done with The Athletic, the online sports media company it acquired last year for $550 million, according to a person familiar with the matter.
Programming CNN Max
Before joining The New York Times, Thompson was director-general (a combination of chief executive and editor-in-chief) of the British Broadcasting Corporation. He’ll have a chance to develop new shows at CNN Max, a tab in Warner Bros. Discovery’s larger Max streaming service.
With CNN Max, Thompson will try to program for a younger audience. CNN’s linear network largely appeals to older, 60-and-up adults who still subscribe to traditional pay-TV.
Thompson will have some runway to invest in CNN Max. CNN’s earnings before interest, taxes, depreciation, and amortization is expected to be closer to $1 billion in 2023 after dipping to $750 million in 2022 when it had about $200 million in losses tied to CNN+, according to people familiar with the matter. Attention from the U.S. presidential election should also improve advertising revenue in 2024.
To keep CNN relevant, Thompson will need to figure out news programming that millennials and younger viewers will watch. Former CNN leadership feared news content would get swallowed up by a larger streaming service, believing it would be difficult to convince viewers to eschew entertainment programming when both are on the same platform. That led Zucker and former WarnerMedia CEO Jason Kilar to push for CNN+, a standalone streaming service.
CNN has already begun considering ideas to solve that problem, including potentially alerting Max viewers who are watching on-demand entertainment to CNN breaking news.
“This is a game that is still very much to be played,” JB Perrette, president and CEO of Warner Bros. Discovery’s streaming operations, said of the streaming-news business last month in an interview with Variety. “Nobody has figured it out yet.”
That will be Thompson’s job.
WATCH: WBD might be a better streaming bet than Disney, says Gabelli’s Kevin Dreyer
Anne Wojcicki attends the WSJ Magazine Style & Tech Dinner in Atherton, California, on March 15, 2023.
Kelly Sullivan | Getty Images Entertainment | Getty Images
23andMe CEO Anne Wojcicki and New Mountain Capital have submitted a proposal to take the embattled genetic testing company private, according to a Friday filing with the U.S. Securities and Exchange Commission.
Wojcicki and New Mountain have offered to acquire all of 23andMe’s outstanding shares in cash for $2.53 per share, or an equity value of approximately $74.7 million. The company’s stock closed at $2.42 on Friday with a market cap of about $65 million.
The offer comes after a turbulent year for 23andMe, with the stock losing more than 80% of its value in 2024. In January, the company announced plans to explore strategic alternatives, which could include a sale of the company or its assets, a restructuring or a business combination.
23andMe has a special committee of independent directors in place to evaluate potential paths forward. The company appointed three new independent directors to its board in October after all seven of its previous directors abruptly resigned the prior month. The special committee has to approve Wojcicki and New Mountain’s proposal.
“We believe that our Proposal provides compelling value and immediate liquidity to the Company’s public stockholders,” Wojcicki and Matthew Holt, managing director and president of private equity at New Mountain, wrote in a letter to the special committee on Thursday.
Wojcicki previously submitted a proposal to take the company private for 40 cents per share in July, but it was rejected by the special committee, in part because the members said it lacked committed financing and did not provide a premium to the closing price at the time.
Wojcicki and New Mountain are willing to provide secured debt financing to fund 23andMe’s operations through the transaction’s closing, the filing said. New Mountain is based in New York and has $55 billion of assets under management, according to its website.
23andMe declined to comment.
WATCH: The rise and fall of 23andMe
Hims & Hers
Shares of Hims & Hers Health tumbled more than 23% on Friday after the U.S. Food and Drug Administration announced that the shortage of semaglutide injection products has been resolved.
Semaglutide is the active ingredient in Novo Nordisk‘s blockbuster weight loss drug Wegovy and diabetes treatment Ozempic. Those medications are part of a class of drugs called GLP-1s, and demand for the treatments has exploded in recent years. As a result, digital health companies such as Hims & Hers have been prescribing compounded semaglutide as an alternative for patients who are navigating volatile supply hurdles and insurance obstacles.
Compounded drugs are custom-made alternatives to brand-name drugs designed to meet a specific patient’s needs, and compounders are allowed to produce them when brand-name treatments are in shortage. The FDA doesn’t review the safety and efficacy of compounded products.
Hims & Hers began offering compounded semaglutide to patients in May, and it owns compounding pharmacies that produce the medications.
Compounded medications are typically much cheaper than their branded counterparts. Hims & Hers sells compounded semaglutide for less than $200 per month, while Ozempic and Wegovy both cost around $1,000 per month without insurance.
The FDA said Friday that it will start taking action against compounders for violations in the next 60 to 90 days, depending on the type of facility, in order to “avoid unnecessary disruption to patient treatment.”
“Now that the FDA has determined the drug shortage for semaglutide has been resolved, we will continue to offer access to personalized treatments as allowed by law to meet patient needs,” Hims & Hers CEO Andrew Dudum posted Friday on X. “We’re also closely monitoring potential future shortages, as Novo Nordisk stated two weeks ago that it would continue to have ‘capacity limitations’ and ‘expected continued periodic supply constraints and related drug shortage notifications.'”
Him & Hers’ weight loss offerings have been a massive hit with investors. Shares of the company climbed more than 200% last year, and the stock is already up more than 100% this year despite Friday’s move.
Even before it added compounded GLP-1s to its portfolio, the company said in its 2023 fourth-quarter earnings call that it expects its weight loss program to bring in more than $100 million in revenue by the end of 2025.
Despite the turbulent regulatory landscape, Hims & Hers has showed no signs of slowing down.
On Friday, the company announced it has acquired a U.S.-based peptide facility that will “further verticalize the company’s long-term ability to deliver personalized medications.” Hims & Hers will explore advances across metabolic optimization, recovery science, biological resistances, cognitive performance and preventative health through the acquisition, the company said.
That move comes just days after Hims & Hers also bought Trybe Labs, the New Jersey-based at-home lab testing facility. Trybe Labs will allow Hims & Hers to perform at-home blood draws and more comprehensive pretreatment testing.
Hims & Hers did not disclose the terms of either deal.
Technology
Tesla recalls more than 375,000 vehicles in U.S. due to failing power-assisted steering systems
Tesla models Y and 3 are displayed at a Tesla dealership in Corte Madera, California, on Dec. 20, 2024.
Justin Sullivan | Getty Images
Tesla is voluntarily recalling 376,241vehicles in the U.S. to correct an issue with failing power-assisted steering systems, according to records posted to the website of the U.S. National Highway Traffic Safety Administration.
In a safety recall report posted on the NHTSA website, Tesla said the recall includes Model 3 and Model Y vehicles that were manufactured for sale in the U.S. from Feb. 28, 2023, to October 11, 2023, and that were equipped with a certain older software release.
The records said printed circuit boards in the steering systems in affected vehicles could become overstressed, causing the power-assist steering to fail in some cases when a Tesla vehicle rolled to a stop and then accelerated.
When electronic power-assist steering systems fail in a Tesla, drivers need to exert more force to steer their cars, which can increase the risk of a collision.
Tesla told the vehicle safety regulator that it was not aware of any crashes, injuries or deaths related to the power steering failures, and that it was offering an over-the-air software update as a remedy.
The recall follows an earlier related probe and voluntary recall in China concerning the same systems.
President Donald Trump has appointed Tesla CEO Elon Musk to lead a team that is slashing the federal government workforce, and in some cases, regulations and entire agencies. Those cuts already affected the NHTSA, an agency Musk has long seen as standing in the way of some of his ambitions at Tesla.
The regulator has been engaged in a yearslong investigation into safety defects in the systems that Tesla markets currently as its Autopilot and Full Self-Driving (Supervised) options. The features do not make Tesla cars into robotaxis. They require a human driver ready to steer or brake at any time.
The Washington Post reported on Thursday that Musk’s team has led mass firings at the NHTSA, reducing the agency’s workforce and capacity to investigate companies including Tesla by about 10%.
Tesla didn’t respond to a request for comment.
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