Viaplay is letting go of more than 25% of its staff as it pulls streaming out of the U.S. and UK and mulls a sale.
The embattled Nordic operation has unveiled a new strategy and plan alongside its Q2 results, which improved on last year but have been paired with a decision to “regrettably let go of more than 25% of our people,” according to new CEO Jørgen Madsen Lindemann, who replaced Anders Jensen last month with immediate effect.
Redundancies will impact around 450 people and the cost of restructuring will be approximately 45M Swedish Krona ($4M), according to today’s Q2 update, with Lindemann set to address investors and journalists in the next hour. The move comes in the same week that Germany’s ProSiebenSat.1 also said it would cut around 400 roles.
Going forwards, Viaplay will discontinue its low tier non-sports offering in the likes of the U.S. and UK and focus on the Nordic and Dutch markets, along with the sale of content internationally via Viaplay Select. It will continue focusing on Nordic originals, the likes of upcoming series Ronja the Robber’s Daughter (pictured), Lasse Hallström’s Hilma biopic and an incoming three-season English-language TV series of Camilla Läckberg and Henrik Fexeus’ bestselling crime novels.
Viaplay, which rebranded from NENT last year, had nascent operations in the UK, U.S. and other markets such as Germany under Jensen including a high-profile Rebus reboot, but is retrenching to focus on its heartlands and distribution. Jensen said “international expansion assumptions, including the timelines to profitability, have also been pushed materially into the future and we are moving quickly to address all of these challenges.”
Lindemann has therefore initiated an immediate strategic review of the entire business to consider all options including “equity injections or the sale of the whole Group.” An operating model restructure was put into action late last month, which has already seen a team of Nordic-based execs take on local segments and reviewing “their organisations to ensure full optimisation and focus.”
He said: “We are today announcing a new strategy and plan, which includes, but is not limited to, focusing on our core Nordic, Netherlands and Viaplay Select operations; implementing a new operational model; downsizing, partnering or exiting our other international markets; rightsizing and pricing our product offering in the Nordics and undertaking a major cost reduction programme.”
The redundancy decision was taken “for the sake of the future of our business,” he added, describing the move as “regrettable.”
Viaplay’s Q2 sales hit around 4.6BN Swedish Krona ($450M), a like-for-like boost of 16% on the prior year driven by 42% organic sales growth but offset by a 16% decline in advertising revenues. Operating income was down 6.5B Swedish Krona ($630M), however, with net income of minus 5.8B Swedish Krona ($560m) for the period.
Viaplay also lost around 1 million total subscribers over the quarter, returning to around 6.6 million – where it was in Q3 2022.
The outfit has already said it will revise financial targets and Viaplay today published a set of new financial goals for 2023 and 2024, which will see an expected circa-$90M EBIT loss this year before potentially returning to profitability next year.
Sales are expected to hit around $1.8B for the full year this year and next, while subscribers are slated to just top 7 million this year but haven’t been published for 2024.