TLDR
- Warner Bros. Discovery’s Q4 results showed a 10-cent per share loss, significantly underperforming the anticipated 3-cent loss.
- Total revenue decreased 6% to $9.46 billion, while linear networks adjusted EBITDA plunged 27% to $1.41 billion.
- The streaming platform HBO Max gained 3.5 million new subscribers, achieving 131.6 million overall, with revenue climbing 5% to $2.8 billion.
- The company faces competing acquisition proposals: Paramount Skydance’s $31 per share offer versus Netflix’s existing $27.75 per share agreement.
- Netflix’s CEO Ted Sarandos planned a White House meeting Thursday regarding the streaming company’s acquisition proposal.
Warner Bros. Discovery unveiled its fourth-quarter financial results on Thursday, falling short of analyst projections as its legacy television and cinema operations faced ongoing challenges.
The media conglomerate recorded a 10-cent per share deficit. Market analysts had projected a more modest 3-cent per share loss, based on FactSet analysis.
Total revenue reached $9.46 billion, representing a 6% year-over-year decline. This figure closely aligned with LSEG’s consensus projection of $9.35 billion.
Warner Bros. Discovery, Inc., WBD
WBD shares increased marginally by 0.1% to $28.91 during premarket hours, though the stock showed no definitive trend.
The traditional television operations experienced another challenging period. Discovery’s Linear Networks division reported revenue declining 12% to $4.2 billion. The segment’s adjusted EBITDA contracted 27% to $1.41 billion — meeting analyst expectations but representing a substantial downturn.
The entertainment production division faced similar headwinds. Adjusted earnings collapsed 23% to $728 million. The movie division lacked significant theatrical releases during the fourth quarter despite delivering nine chart-topping films throughout 2025.
The television production arm suffered from unfavorable content licensing timing, experiencing an 18% revenue reduction.
Streaming Held Up
However, not all divisions struggled. The HBO Max platform delivered encouraging performance, propelled by popular programming including “Heated Rivalry” and “It: Welcome to Derry.”
The streaming division attracted 3.5 million additional subscribers during the quarter, elevating its worldwide subscriber base to 131.6 million. Streaming revenue advanced 5% to approximately $2.8 billion.
Adjusted streaming segment earnings declined 4% to $393 million, attributed to the conclusion of an undisclosed distribution agreement.
The Takeover Fight
Financial performance has become almost a sideshow. The primary focus centers on the escalating acquisition competition for Warner Bros. Discovery.
Last December, WBD accepted Netflix’s proposal to acquire its streaming and studio operations for $27.75 per share. Under that arrangement, cable properties would be separated and distributed to current shareholders.
Subsequently, Paramount Skydance escalated the competition last week by suggesting a potentially higher all-cash proposal for the entire Warner Bros. Discovery entity. This Tuesday, WBD’s board announced it would evaluate whether Paramount’s offer “could reasonably be expected” to constitute a superior transaction.
Paramount has contended that Discovery’s traditional television assets hold negligible equity value, referencing Versant Media Group — CNBC’s parent company regarded as a comparable entity — and its trading performance following its recent market entrance.
Netflix’s chief executive Ted Sarandos had a scheduled White House appointment Thursday to address Netflix’s acquisition proposal, according to Politico, citing two informed sources. Netflix declined to provide immediate commentary.
WBD’s board has yet to conclude whether Paramount’s submission surpasses the Netflix agreement. Should that determination be made, Netflix would receive four business days to modify its proposal.
Thursday’s earnings announcement contained no reference to the Paramount negotiations.
