Warner Bros. Discovery reported a steep first-quarter loss of $2.92 billion, significantly widening from the $453 million loss recorded during the same period last year. The decline was largely driven by restructuring expenses and a massive termination fee linked to a collapsed Netflix transaction.
The company disclosed that the quarter included nearly $1.3 billion in pre-tax charges related to restructuring, acquisition amortisation, and content valuation adjustments. In addition, it recorded a $2.8 billion fee tied to the cancellation of a planned deal involving Netflix
The deal reportedly fell through after a competing proposal from Paramount Global and Skydance emerged earlier this year. While Paramount is expected to absorb the termination fee as part of its merger arrangement, the liability currently remains on Warner Bros. Discovery’s books until the transaction officially closes.
Despite the losses, the company’s streaming business emerged as a bright spot. Streaming revenue rose 9% year-on-year to $2.89 billion, fueled by the international growth of HBO Max and stronger user engagement. The platform also crossed 140 million global subscribers during the quarter and expects to surpass 150 million by year-end.
However, challenges persist across its traditional television business. Revenue from networks including CNN and Discovery Channel declined, while advertising revenue was impacted by shrinking TV audiences and the absence of NBA media rights.
On the positive side, the studio division delivered strong momentum, with film revenue rising 35% year-on-year – offering some relief amid an otherwise financially turbulent quarter.
