Netflix will buy some of Warner Bros. Discovery’s most valuable media portfolio for nearly $83 billion in a cash-stock deal, the two companies said Friday, setting up one of the largest media mergers this decade.
The streaming giant will acquire some of WBD’s film and TV studio, as well as HBO and the streaming service HBO Max. WBD’s cable networks, including the news giant CNN, are to be spun off in advance of the merger. That plan was announced in June.
Combining the two companies’ vast media libraries will further Netflix’s ability to “entertain the world,” Ted Sarandos, the co-CEO of Netflix, wrote in a statement.
David Zaslav, WBD president and chief executive, said the deal will “ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come.”
Two other companies — Comcast and Paramount Skydance — were reportedly involved in a multi-round bidding war for the media conglomerate. Representatives for those companies did not respond to requests for comment on Netflix’s deal.
In a memo to WBD staff, Zaslav said the sale “reflects the realities of an industry undergoing generational change — in how stories are financed, produced, distributed, and discovered.”
“The proposed combination of Warner Bros. and Netflix reflects complementary strengths, more choice and value for consumers, a stronger entertainment industry, increased opportunity for creative talent, and long-term value creation for shareholders,” he wrote. Elements of WBD outside the deal, including the cable news channels CNN, TNT Sports and Discovery, will be part of a new stand-alone company called Discovery Global, Zaslav said, that he expected to be squared away by the third quarter of 2026.
The deal would require shareholder approval and regulatory approval from President Donald Trump’s administration. In its regulatory filing disclosing the terms of the deal, Netflix offered a $5.8 billion breakup fee should the deal fall apart as a result of antitrust or other legal challenges. The Justice Department did not respond to a request for comment about whether it would challenge the deal.
“Given what is happening in entertainment markets, the DOJ is very likely to take a close look,” said Diana Moss, director of competition policy at the Progressive Policy Institute, a center-left-leaning think tank. “There could be concerns over eliminating head-to-head competition and potential competition.”
Moss noted allegations that the Trump administration interfered in similar mergers, including the Paramount-Skydance deal, to advance the president’s personal agenda.
Paramount has said it “has no knowledge of any promises or commitments made to President Trump.”
Telecommunications giant AT&T bought Time Warner in 2018 in an $85 billion deal. The Trump administration sued to block the transaction on antitrust grounds but was unsuccessful in court. The union nevertheless proved short-lived, as AT&T spun off its news and entertainment assets in 2022 and merged them with Discovery to create Warner Bros. Discovery.
If the Netflix-Warner Bros. deal is approved by regulators, said Mike Proulx, research director for the business research firm Forrester, “Netflix will cement itself as the Goliath of streaming services now with the combined weight of HBO Max and the content studios behind it all. This deal changes the calculus of the streaming wars, representing a seismic shift in the entertainment industry.”
Netflix had an estimated 69 million paying subscribers in the U.S. — nearly triple the amount of HBO Max — and one of the lowest churn rates in the industry in October, according to metrics from the data analytics start-up Antenna.
Some critics have focused on the prospect of further concentration in the streaming market. Sen. Elizabeth Warren (D-Massachusetts) called the merger an “anti-monopoly nightmare.”
“A Netflix-Warner Bros. would create one massive media giant with control of close to half of the streaming market — threatening to force Americans into higher subscription prices and fewer choices over what and how they watch, while putting American workers at risk,” she wrote in a statement.
Hollywood unions came out in opposition, too.
“This merger must be blocked,” Writers Guild of America spokesman Bob Hopkinson said in a statement. The merger would “eliminate jobs, push down wages, worsen conditions for all entertainment workers, raise prices for consumers, and reduce the volume and diversity of content for all viewers.”
Mitchell Schwenz, a spokesman for the Directors Guild of America, said the group intends to outline its concerns about the deal to Netflix. “We believe that a vibrant, competitive industry — one that fosters creativity and encourages genuine competition for talent — is essential to safeguarding the careers and creative rights of directors and their teams,” he said.
Samantha Chery contributed to this report.
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