Warner Bros. Discovery’s main studio in the U.K. is getting a major upgrade.
The company is expanding its operation at Warner Bros. Studios Leavesden. The studio has housed the production of hits such as Harry Potter, House of the Dragon, and this summer’s breakout hit, Barbie.
The expansion will add 10 new soundstages–amounting to an additional 400,000 square feet–and will increase production capacity by over 50%. The project may cost the company approximately $100 million, according to analyst estimates. Construction will begin in 2024, with expected completion by 2027.
The move is projected to create 4,000 jobs in the United Kingdom, said Simon Robinson, chief operating officer of Warner. Bros Discovery Studios.
Once finished, Leavesden will serve as the main production hub for DC Studios.
Expanding into the UK gives Warner Bros. Discovery the opportunity to widen its global reach, as newer media studios have done while being mindful of economic realities. Already leveraged following the high-profile merger of AT&T’s WarnerMedia and Discovery in 2022, the company has seen its stock value and earnings suffer as strikes by the Writers Guild of America and the Screen Actors Guild paralyzed domestic production schedules over the summer.
By expanding Leavesden, the company is attempting to follow in Netflix’s footsteps. The streaming giant has seen outsized success widening its reach outside of North America by producing popular global titles such as the South Korean series Squid Game.
The move allows Warner Bros. Discovery–whose other main studio is located in Burbank, California– to globally expand its production footprint using infrastructure that it already possesses, rather than falling further into debt by building a new production space from the ground up, as Netflix has been able to do, said David Heger, a senior equity analyst at Edward Jones.
Another motivation is insolation from expensive interruptions in content production.
“It’s good to have studio operations in both geographies,” Heger said. “That way, whatever issues [studios] may have–it may not be a strike, it could be macroeconomic issues or the ability to hire enough production talent, or any number of things–could benefit from having two geographic locations.”
Warner Bros. Discovery relies on a steady stream of content to fill its triumvirate of film and television studios, television networks, and streaming services. As the summer strikes have stalled domestic production, the company saw stock value fall by approximately 17% from May to September this year. In a September SEC filing, executives reduced earnings guidance between $300-$500 million for the year, which they attributed directly to the strikes.
The U.K. studio expansion doesn’t appear to be enough to have assuaged investors. Since the announcement was made last week, the company’s stock has fallen by 8.6%, as Wall Street grapples with financial implications from studio concessions made to resolve the WGA strike, and SAG-AFTRA performers continue their march on the picket line.