Observed Signal · Feb 26, 2026 · M&A · Source: Adweek · Impact: 4/5 · Sentiment: Negative
WBD CEO Highlights Competitive Landscape Amid Netflix Deal Uncertainty
Warner Bros. Discovery (WBD) reported Q4 revenue of $9.5 billion and fiscal 2025 revenue of $37.3 billion (a 5% decline). Ad revenues fell 9%, and content revenues fell 10%; WBD said loss of the NBA reduced growth by roughly 4%. The company reported 131.6 million streaming subscribers across HBO Max and Discovery+, up 3.5 million from the prior quarter, and said Q4 2025 would be the final quarter it would consistently report subscriber counts. During the Q4 earnings call and a shareholder letter, WBD said its merger agreement with Netflix “remains in effect” and the board continues to recommend the Netflix transaction, but an updated all-cash proposal from Paramount Skydance could qualify as a “Company Superior Proposal.” CEO David Zaslav said a highly competitive sale process has raised the company’s value; Netflix’s revised bid is about $72 billion ($27.75 per share) while Paramount Skydance recently raised a cash offer to $31 per share.
WBD is a major publisher/streamer; its earnings, ad-revenue declines, subscriber reporting change, and an active sale/M&A process involving Netflix and Paramount Skydance could materially affect CTV inventory, ad monetization, and market structure for advertisers and media buyers.
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Key Takeaways & Evidence Grounding
- Warner Bros. Discovery reported Q4 revenue of $9.5 billion.
- Fiscal 2025 total revenue was $37.3 billion, a 5% decrease year-over-year.
- Ad revenues declined 9%; content revenues decreased 10%; WBD said losing NBA rights reduced growth by ~4%.
- WBD reported 131.6 million streaming subscribers across HBO Max and Discovery+, up 3.5 million from Q3; Q4 2025 will be the last quarter it consistently reports subs.
- WBD board continues to recommend the Netflix merger (Netflix revised bid ~ $72 billion / $27.75 per share); Paramount Skydance submitted an updated all-cash proposal (recently $31 per share) that could be a 'Company Superior Proposal.'
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WBD CEO Defends Culture Amid Paramount Merger Turmoil
Warner Bros. Discovery (WBD) reported mixed second-quarter results — streaming revenue rose 10% driven by HBO Max international expansion and originals, while ad revenue fell 22% and studio revenue dropped 39% year-over-year. The near-$111 billion proposed merger involving Paramount, Skydance and WBD faces antitrust headwinds, but WBD CEO David Zaslav said during the company's Q2 earnings call that he is confident the transaction will close and dismissed questions about the company's future if the deal fails. The reporting highlights pressure on ad revenue linked to ad-lite streaming subscriber growth, the absence of NBA content, and declines in domestic linear audiences.
Warner Bros. Discovery Bidding War Intensifies
A competitive auction for Warner Bros. Discovery escalated as Netflix, Comcast and Paramount Skydance submitted revised bids that take different strategic approaches. Paramount, backed by private equity and sovereign wealth funds, is pursuing a purchase of the entire company and raised its breakup fee to $5 billion. Netflix and Comcast are targeting WBD’s studio and streaming businesses—specifically HBO, Max and the Warner Bros. film and TV library—while leaving legacy cable channels out of their offers. Netflix shifted toward a mostly cash offer with some stock after earlier stock-heavy proposals; Comcast proposed a cash-and-stock deal that would merge NBCUniversal with WBD assets. The bids are expected to face intense antitrust scrutiny, with reports suggesting the U.S. administration may view a Paramount acquisition more favorably than Comcast or Netflix deals. WBD’s board must decide between selling whole, splitting assets, or proceeding with its planned formal separation of studio/streaming from legacy cable.
WBD Leans on Streaming as Linear TV Declines
Warner Bros. Discovery (WBD) discussed its Q2 results and strategy during an earnings call, stressing confidence in a pending sale to Paramount Skydance while declining to elaborate on the merger amid antitrust challenges. WBD reported about $8.7 billion in Q2 revenue, citing softer ad sales and the decline of linear TV — including the loss of domestic NBA rights — for a 22% drop in overall ad revenue. Streaming was the bright spot: overall streaming revenue rose 9% year-over-year to over $3 billion, with roughly 40% of HBO Max subscribers on ad-supported plans (up 11% YOY) and streaming ad revenue up 8% YOY. WBD also reported a 73% increase in international ad revenue after HBO Max launches in new markets and emphasized growth levers including live sports, bundles and ad formats such as pause ads.
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