Key Takeaways
- Warner Bros. Discovery’s Q4 results showed a 10-cent per share loss, significantly worse than the projected 3-cent loss.
- Quarterly revenue declined 6% to $9.46 billion, while linear networks adjusted EBITDA plunged 27% to $1.41 billion.
- The HBO Max platform gained 3.5 million new subscribers, pushing the total to 131.6 million, while revenue increased 5% to $2.8 billion.
- The company is evaluating a $31 per share offer from Paramount Skydance versus the existing $27.75 per share Netflix agreement.
- Netflix’s CEO Ted Sarandos planned a White House meeting Thursday to address the streaming company’s acquisition proposal.
Warner Bros. Discovery unveiled fourth-quarter financial results Thursday that fell short of analyst projections, highlighting ongoing challenges in its conventional television and motion picture operations.
The media conglomerate recorded a 10-cent per share deficit. Financial analysts had anticipated a more modest 3-cent per share loss, based on FactSet projections.
Quarterly sales totaled $9.46 billion, representing a 6% year-over-year decrease. This figure aligned closely with LSEG’s consensus projection of $9.35 billion.
Warner Bros. Discovery, Inc., WBD
WBD shares inched up 0.1% to $28.91 during premarket activity, though the stock showed no definitive momentum.
The company’s traditional cable and broadcast television operations experienced another difficult quarter. Revenue from the Discovery Linear Networks division contracted 12% to $4.2 billion. Segment-adjusted EBITDA decreased 27% to $1.41 billion — meeting analyst expectations but representing a substantial downturn.
The entertainment production and studio division also faced headwinds. Adjusted income collapsed 23% to $728 million. The theatrical division had zero major releases during the final quarter after delivering nine chart-topping films throughout 2025.
The television production arm suffered from content renewal timing issues, experiencing an 18% revenue decline.
Streaming Division Shows Resilience
Despite broader challenges, HBO Max delivered positive momentum, fueled by popular programming including “Heated Rivalry” and “It: Welcome to Derry.”
The digital platform secured 3.5 million additional subscribers during the period, elevating its worldwide subscriber base to 131.6 million. Streaming division revenue climbed 5% to approximately $2.8 billion.
Adjusted profits for the streaming operation fell 4% to $393 million, attributed to the conclusion of an undisclosed distribution partnership.
The Acquisition Battle
Financial performance has taken a backseat to the unfolding acquisition drama surrounding Warner Bros. Discovery.
In December, WBD reached an agreement to divest its streaming operations and studio assets to Netflix for $27.75 per share. Under that arrangement, the cable properties would be separated and distributed to current shareholders.
However, last week, Paramount Skydance escalated the competition by suggesting a potentially higher all-cash proposal for the entire Warner Bros. Discovery entity. On Tuesday, WBD’s board announced it would evaluate whether the Paramount offer “could reasonably be expected” to constitute a superior transaction.
Paramount has contended that Discovery’s linear television assets possess no shareholder value, referencing Versant Media Group — CNBC’s parent company and considered a comparable business — and its trading performance since going public last month.
Netflix CEO Ted Sarandos had a scheduled White House visit Thursday to address Netflix’s acquisition proposal, according to Politico, which cited two sources knowledgeable about the discussions. Netflix has not yet provided comment on the matter.
WBD’s board has not rendered a determination on whether Paramount’s proposal surpasses the Netflix transaction. Should the board reach that conclusion, Netflix would receive four business days to modify its offer.
Thursday’s earnings release contained no reference to the ongoing Paramount negotiations.
