Hollywood actors and studios reached a tentative deal Wednesday to end a months-long strike that has crippled the entertainment industry, delayed hundreds of popular shows and films, and cost billions to the US economy.

The Screen Actors Guild called off its 118-day strike from midnight (0800 GMT Thursday) after finally reaching an agreement with the likes of Disney and Netflix for a new contract including higher pay, and protections against the use of artificial intelligence. 

The announcement paves the way for actors to head back to movie sets, an end to picket lines outside studios, and a return to employment for thousands of other jobs linked to the entertainment industry.

"In a unanimous vote this afternoon, the SAG-AFTRA TV/Theatrical Committee approved a tentative agreement… bringing an end to the 118-day strike," a spokeswoman said in a statement to AFP.

In a message sent to union members, negotiators said the contract was valued at more than $1 billion and would enable members "to build sustainable careers."

The Alliance of Motion Picture and Television Producers, which represents the studios, said it was "pleased" to have reached a deal, and trumpeted a "brand new residual for streaming programs," without offering details. Residuals are long-term payments for shows after their initial release.

The deal still needs to be ratified by the union's board, and members. That process could take weeks, but the agreement is widely expected to pass.