Yahoo Finance

Shares of Netflix, Warner Brothers Discovery and other media stocks moving lower today. That's after President Donald Trump called for a 100% tariff on all foreign produced films via Truth Social posts on Sunday. Trump speaking today said he expects to meet with some in the film industry.

Hollywood doesn't do very much of that business. They have the nice sign and everything's good, but they don't do very much. A lot of it's been taken to other countries, and a big proportion. And I'm actually going to meet with some because you know, there's some advantages, I guess. And I'm not looking to hurt the industry. I want to help the industry. Uh, but uh, they given financing by other countries. They've given a lot of things, and the industry was decimated. If you look at how little is done in this country now, you know, you think we were the ones. We used to do a hundred not long ago, 100%. Now we do uh, almost like very little. So we're going to meet with the industry. I want to make sure they're happy with it, uh, because we're all about jobs. That's all what I'm, you know, it's very important. It's a big industry, but it's an industry now that's uh, it's really left. It's abandoned the USA where it started. But and we'll get it we'll get it back.

Yahoo Finance's Alexandra Canal joins us now with more. Allie.

Hi Josh. Yeah, interesting to hear those comments from President Trump. Perhaps a suggestion that ultimately these tariffs, at least the tariffs that he had promised 100% on foreign made movies, they won't go into effect as he promised. But there's still a lot of unknowns about this. If we take a look at some of those media companies most exposed, you'll see names like Disney, Paramount, Warner Brothers Discovery. They were under pressure throughout the day. However, significantly off those session lows. But the news certainly sent shockwaves through the industry at large, which is still dealing with the after effects of the COVID-19 pandemic along with those recent strikes from the writer side and the actor side. I did have the chance to speak to a few Hollywood producers this morning who told me that tariffs would considerably slow down the industry. Worst case scenario, you could potentially see a complete shutdown. One veteran producer described the tariffs as quote insane and devastating. She warned that they could actually wipe out those lower to mid-budget films. So think those independent films that are susceptible to these higher budgets, because that's essentially what would happen. Tariffs would drive up costs. It would really disrupt the the global order of things because making movies now it's become a much more interconnected experience, from the editing process to the filming process, to the distribution process. And on top of that, US tax incentives, they are not enough to offset bringing those films here. There's a lot of really good incentives in places like the UK, Canada, the Czech Republic. And that's why you're seeing a lot of these upcoming blockbusters. They're all filmed in those locations. So this is something that could definitely impact the traditional studios like your Disney's and your Paramounts, but also the streaming companies as well. And Netflix, for example, produces more films than any other studio and derives up to 30% of its viewership from film content. We know a lot of their content is more localized content. So, you know, it's something to continue to track, but again, we don't know a lot about this. It was one post on Truth Social. We've already heard the president wants to help the industry, wants to talk to the industry to try and come to a resolution, but, you know, this is something that folks were not expecting, and it was a scramble.