Warner Bros. Discovery books $2.9B net loss tied to Paramount deal
CNBC • • general
Key Points:
- Warner Bros. Discovery (WBD) reported a first-quarter net loss of $2.9 billion, significantly higher than the $453 million loss from the previous year, largely due to $1.3 billion in acquisition-related expenses and a $2.8 billion termination fee owed to Netflix after a failed deal.
- The termination fee, part of the failed Netflix transaction, is currently on WBD's books but is refundable to Paramount Skydance, which is acquiring WBD; the acquisition is awaiting regulatory approval and expected to close in the third quarter.
- First-quarter revenue declined 1% year-over-year to $8.89 billion, while adjusted EBITDA rose 5% to $2.2 billion; WBD ended the quarter with $33.4 billion in gross debt.
- Streaming revenue grew 9% to $2.89 billion, driven by HBO Max’s international expansion and a 20% increase in advertising revenue from its ad-supported tier, with the company surpassing 140 million global streaming subscribers and targeting 150 million by year-end.
- Traditional pay TV networks saw an 8% revenue decline to $4.38 billion, impacted by an 11% drop in linear advertising revenue mainly due to the loss of NBA media rights, while the film studio division's revenue rose 35% to $3.13 billion.
