The American flag flies at Warner Bros. Studios on September 12, 2025 in Burbank, California.
Tama Mario | Getty Images
warner bros discovery There’s a reason why it reported a staggering first-quarter net loss on Wednesday.
The company posted a net loss of $2.9 billion, far higher than the $453 million net loss it reported in the same period last year.
This figure includes $1.3 billion in “pre-tax amortization of acquisition-related intangible assets, content fair value enhancements and restructuring costs” and a $2.8 billion termination fee payable by Warner Bros. Discovery. Netflix After a pending deal failed in February.
Netflix has backed away from a proposal to acquire WBD’s assets. paramount skydance I came with a higher offer. Paramount agreed to pay a termination fee as part of the deal to acquire all of WBD, but that fee will remain on WBD’s books until the deal closes.
This amount would be refunded to Paramount under certain circumstances, such as if we exit the deal with Paramount for a higher offer, so the obligation would shift to WBD.
Paramount’s proposed acquisition received approval from WBD shareholders in April and is currently undergoing a regulatory review process. Paramount said in its earnings call Monday that it has made “significant progress” toward closing the transaction, which is expected to close in the third quarter.
WBD also reported Wednesday that first-quarter revenue was $8.89 billion, down 1% year over year. The company’s adjusted earnings before interest, taxes, depreciation and amortization rose 5% to $2.2 billion. WBD had total debt of $33.4 billion at quarter end.
Streaming continued to be a highlight for the company.
Total streaming revenue increased 9% to approximately $2.89 billion as subscriber revenue increased from the expansion of WBD’s flagship streaming platform, HBO Max, in international markets. The division’s advertising revenue increased 20% as more customers enrolled in ad-supported tiers.
In a letter to shareholders, the company said it exceeded its plan to have more than 140 million streaming customers worldwide at the end of the first quarter and is on track to have more than 150 million global subscribers by the end of the year.
WBD’s portfolio of pay TV networks, including CNN, TBS, and Discovery Channel, continued to weigh on the company. The linear TV network’s revenue was $4.38 billion, down 8% year over year. The company said linear ad revenue declined 11%, primarily due to the lack of NBA media rights in its portfolio.
Meanwhile, the movie studio division’s revenue rose 35% year over year to $3.13 billion.
