WBD CEO Sees More Media Deals Under Trump

Warner Bros Discovery CEO David Zaslav anticipates a friendlier environment for deal-making under the incoming Trump administration, opening the door to industry consolidation, he said on Thursday.

"That would provide real positive and accelerated impact on this industry that's needed," Zaslav told investors on a conference call after the company released quarterly earnings. He was referring to the election of Donald Trump as U.S. president on Wednesday. The Republican defeated Democratic candidate Kamala Harris.

Reuters reports Strict antitrust policies under the Biden administration have weighed on deal-making across industries over the past few years, limiting the options for media companies.

Zaslav told investors the entertainment and broadcasting industry was ripe for consolidation, which would improve consumer experiences in streaming as various services are combined into more coherent offerings.

"In general, Trump favors deregulation," said eMarketer television and streaming analyst Ross Benes. "That will increase the odds of more M&A. But most large media M&A deals in recent history have turned out poorly for employees and investors."

David Zaslav

Warner Bros Discovery and its peers are navigating through what Zaslav described as a "generational disruption," confronting an erosion of its lucrative television business as millions of consumers migrate to streaming video services.

A new regulatory filing reveals Zaslav had engaged in merger discussions with Paramount Global last December, though a deal never materialized. The company also explored a plan to split its streaming and studio businesses from its television networks.

In August, Warner Bros Discovery wrote down the value of its television assets by $9 billion. Paramount Global followed suit, taking a $5.98 billion charge for its television networks that same month. As recently as last month, Comcast said it was weighing spinning off its cable networks into a separate company, a strategy the Walt Disney Co earlier this year evaluated and rejected.

Earlier on Thursday, Warner Bros Discovery reported a surprise quarterly profit, helped by cost controls and an Olympics-driven record jump in streaming subscribers that made up for a lack of major box-office hits from its studio.

The company's Max streaming platform expanded into Europe weeks before the Olympic Games in Paris with exclusive rights to stream the showcase sporting event, boosting subscribers.