Yahoo Finance Candle Media Restructures, Folding Animation Into Moonbug As Hello Sunshine Chief Sarah Harden Takes Over Rebranded Studio – Update
UPDATED with official details and exec comment. Candle Media, which launched in 2021 with backing from private-equity giant Blackstone, is restructuring its operations in response to broader changes in the streaming sector.
The company has issued a press release confirming some of what had been reported by Semafor on Tuesday morning. (See earlier details below.)
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“We are excited to announce that in order to continue to drive and enhance the collaboration and synergies that are core to Candle’s vision, mission and culture we have organized our live action, premium content capabilities into a newly formed Candle Studios division, which will be led by the incomparable Sarah Harden, who will serve as its CEO,” said Candle Media Co-CEOs Kevin Mayer and Tom Staggs. “This will bring all of our live action properties into one division, with each benefiting from a go-to-market strategy and shared resources, while retaining their unique brand identity, audience profiles and day-to-day creative and business leadership.”
The new studios division will utilize shared resources including, but not limited to business affairs, legal affairs, production services, facilities and equipment, including a coordinated sales and distribution process, targeting both domestic and international buyers, the company added.
“I’m thrilled to take on an expanded role within Candle Media, supporting the growth of these incredible business units and identifying new avenues for growth,” said Harden, who is now CEO of Candle Studios and Hello Sunshine. “I am so proud of what we have built at Hello Sunshine and excited to continue in my role as CEO.”
In 2024, Candle Studios will be in production on more than 30 premium originals. The slate includes The Last Thing He Told Me (Season 2), The Morning Show (Season 4), Surface, Extreme Home Makeover and F1 Academy from Hello Sunshine, Vgly Season 2 for Max Mexico from Exile Content Studio, and Crime Nation Season 2 for The CW from Candle True Stories. Faraway Road is in development on Season 5 of Fauda as well as a feature film stemming from the property, in addition to other projects.
PREVIOUSLY:
Candle Media, which launched in 2021 with backing from private-equity giant Blackstone, is restructuring its operations to reflect broader changes in the streaming sector.
The company, led by former senior Disney execs Kevin Mayer and Tom Staggs, will split into two divisions and make other related changes. Candle’s formation was premised on the opportunity for streaming content fueled by social media. At the time, streamers were chasing Netflix and adding subscribers as they piled up losses; in the intervening years, Wall Street insisted on profitability instead of subscriber growth, punishing a number of players and casting a wary eye on the go-go spending it once admired.
The broader economy also grew turbulent in the years since Candle’s launch, with interest rates surging and inflation spiking. Rising rates cast Candle’s $1.4 billion of debt into a different light. During an early spree, Candle made a number of high-profile acquisitions, including those of Reese Witherspoon’s Hello Sunshine and CoComelon producer Moonbug Entertainment.
Citing dramatic changes in the overall entertainment landscape, especially streaming, the company said it would fold its animation operation into Moonbug. Most other production will move to a new live-action division called Candle Studios, to be run by Hello Sunshine chief Sarah Harden. The new studio will encompass production companies Exile, True Stories, and Fauda creator Faraway Road. Hello Sunshine is the anchor tenant, having produced Hulu’s Little Fires Everywhere and Apple’s The Morning Show.
Mayer detailed the company’s updated strategic plan in an interview with Semafor published Tuesday. The article did not detail the impact on the company’s workforce of the restructuring, including the potential for layoffs.
In addition to the restructuring, Mayer said Candle is also undertaking a number of cost-efficiency initiatives in addition to the restructuring, including combining certain back-office functions. “We paid at the top of the market,” Mayer told the outlet. “Have the financials borne out the way we would like, to have to support the prices that we paid? Probably not.” But he said: “Talk to us in two or three years.”
The dual Hollywood strikes of 2023 also dealt a serious blow to Candle.
Mayer, who experienced a number of peaks and valleys (though mostly the former) during his run at Disney, is not sounding any alarms. “There’s cycles in any company where you’re in a growth phase, you accumulate a little bit of extra cost but it doesn’t matter,” Mayer said. “And then you hit a plateau that causes you to look again at the bottom line and cut costs. It’s a very healthy thing to do.”
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