Warner Bros. Discovery (WBD), embroiled in a high-stakes bidding war between Netflix and Paramount Skydance, reported a 6% drop in fourth-quarter revenue to $9.46 billion, in line with analyst expectations, as declines in its traditional TV and film businesses offset gains in streaming.
The company posted a net loss of $252 million for the quarter ended December 2025, though adjusted EBITDA came in at $2.22 billion. Investor focus centered on any hints about the ongoing deal talks, as Paramount Skydance recently raised its offer to $31 per share in cash (plus incentives), prompting WBD's board to determine it could reasonably lead to a superior proposal over the existing Netflix merger agreement.
The board continues to engage with Paramount while the Netflix deal remains in place; Netflix has a window (four business days under terms) to match or revise if a superior offer emerges.
Streaming revenue rose about 5% (or 4% in some reports) to nearly $2.8 billion, fueled by buzzy series including "Heated Rivalry" and "It: Welcome to Derry." However, adjusted earnings for the streaming group dipped 4% to $393 million, partly due to the end of a prior distribution deal.
Traditional segments struggled significantly. The studios group (film and TV) saw adjusted income fall 23% to $728 million, hampered by no major theatrical releases during the holiday period and an 18% revenue slide in television due to content renewal timing—despite the studio having nine No. 1 box-office openers earlier in 2025.The linear networks business (Discovery and TV networks) continued eroding amid broader pay-TV subscriber losses, with revenue down 12% to $4.2 billion and adjusted income plunging 27% to $1.4 billion.