Licht stepped down this month after several missteps that culminated in an embarrassing profile of him in the Atlantic. He had focused his efforts mostly on reshaping TV coverage to counter the perception that CNN had swung too far left. The idea was that there was a big market for down-the-middle news in a sea of partisan media. It didn’t work. CNN’s ratings kept sinking.

The next leader of CNN will confront the reality that the TV business is simply in decay from sustained cable cord-cutting, media executives say—a trend that no tweak to editorial strategy is going to reverse.

The challenge will be to retool the company for the future. CNN’s digital properties, including its website and app, averaged 166 million global readers a month from January through October 2022—making it one of the most-trafficked destinations on the web. But the TV operation, which draws some 568,000 prime-time viewers, still generates the most of the profits.

In other words, the eyeballs are increasingly in digital but the money is still in TV.

“People tend to look for a leader first and a strategy second,” said Jonathan Miller, chief executive of Integrated Media, which specializes in digital media investments. “I actually think you have to do the reverse.” Miller is a former executive at Wall Street Journal parent News Corp.

The recipe for success at CNN used to be easy. Produce straight news on a tight budget, and steer clear of star anchors. Collect big subscriber fees from pay-TV distributors, and charge advertisers a premium. The results were billions in profits.

Now, the network is trying to grow while the larger cable universe shrinks. Some 68 million U.S. households subscribe to cable packages that include CNN, down from 72.5 million last year, according to the research firm S&P Global. Fewer cable households translates into lower ratings.

CNN charges pay-TV distributors a monthly fee of about $1.25 per subscriber, S&P Global said. Maintaining and increasing that subscription fee will be a challenge, as distributors are seeking to cut costs.

Domestic ad revenue has tumbled in the past few years. In 2020, CNN topped $900 million in ad revenue in the U.S., according to Vivvix Advertising Intelligence, an ad-tracking firm. In 2022, that figure fell to just under $600 million and through the first four months of this year it was about $160 million, per Vivvix.

A spokesman for CNN’s parent company, Warner Bros. Discovery, disputed the 2022 and 2023 figures as low.

Until recently, CNN routinely generated more than a billion dollars in profit annually, a person familiar with its finances said. This year that figure is expected to be closer to $800 million, the person said.

Maintaining that level of profit—or at least slowing the decline—is crucial for Warner Bros. Discovery, which took control of CNN in a merger last year, given that other parts of its empire are under financial pressure. Warner’s stock price has fallen more than 40% since April 2022. The company is focused on getting its Max streaming service, which is losing money, to profitability. The company has said Max’s U.S. operations will be profitable for 2023, a year ahead of schedule.

Warner Bros. Discovery CEO David Zaslav backed Licht’s strategy for CNN, saying last year that the network needs to “show both sides of every issue” and distinguish itself from “advocacy networks.” He hasn’t wavered from that belief, a person close to senior management said.

Zaslav’s first move at CNN was to undo the previous regime’s bet on a direct-to-consumer streaming service, CNN+, that carried a variety of original content. It was priced at $5.99 a month. Zaslav shut down CNN+ a month after its launch, with some $300 million already pumped into the effort. He and his lieutenants concluded the service faced long odds, partly because it didn’t carry live CNN TV programming.

Some Warner Bros. Discovery executives said it would be better to build around CNN’s existing, large-scale digital operation. In October 2022, the network hired Athan Stephanopoulos, the former president of NowThis, a news outlet focused on young audiences, to serve as its chief digital officer and help expand CNN’s digital products.

CNN has been trying to increase time spent with its audience on the mobile app, website and other direct-to-consumer platforms, hoping that will boost ad sales, a person familiar with the company’s plans said.

CNN also has been looking to create its presence on other platforms, from YouTube to TikTok to Instagram, and encourage talent to create content that will feel natural on those services, the person said. On some platforms, such as TikTok, the revenue opportunities are expected to be limited in the near term.

Some CNN programming, such as Chris Wallace’s interview show, is also being repurposed on Warner Bros. Discovery’s Max streaming service. The company is still exploring how other content from CNN can fit into the Max platform, a person familiar with the situation said.

In the short term, the TV business will remain critical. CNN has a chance to boost its ratings as the 2024 U.S. presidential-election cycle kicks into higher gear. Licht left the network in third place, far behind both Fox News and MSNBC. He also made some programming bets, putting Kaitlan Collins, the network’s 31-year-old rising star, into prime time as the anchor of the 9 p.m. hour., and lining up a weekly show for this fall from CBS’s Gayle King and NBA commentator Charles Barkley.

Media analyst Rich Greenfield of LightShed Partners thinks Warner Bros. Discovery should consider selling CNN, calling it a “trophy asset” and saying it has caused management headaches that are distracting the company. People close to Zaslav say there are no plans to sell CNN.

Greenfield acknowledged that finding an acquirer would be no small feat given the bleak outlook for the future of pay-television.

“Anybody who buys cable networks is signing their death certificate whether they know it or not,” Greenfield said.

Write to Joe Flint at [email protected] and Isabella Simonetti at [email protected]