Three hits in three months buoyed Warner Bros. film studio as advertising tanked at media networks in a mixed third quarter that reinforces the logic of a sale or split.
WBD reported consolidated revenue down 16% to $1.4 billion — missing Wall Street forecasts — and swung to a net loss of $148 million. Adjusted earnings of $2.5 billion rose 2%. The quarter saw $1.3 billion in restructuring expenses and other one-time charges. Shares are down 2% in premarket trading.
Theatrical revenue surged 74%, fueling a 23% jump at Studios to $3.3 billion. DC’s Superman by James Gunn released July 11 has grossed $615 million worldwide with a sequel in the works; Weapons has grossed north of $267 million since its release in August; and The Conjuring: Last Rites, out Sept. 5, passed $490 million. The company also cited F1, a holdover from the previous quarter. That’s a studio overdelivering amid an 11% domestic box office slump referenced multiple times by exhibitors this earnings season.
Ad revenue fell 16% to $1.4 billion with networks hit by tough comps with 2024 when Warner Bros. Discovery had European streaming and pay TV rights to the Summer Olympic Games in Paris but also an ongoing slump in domestic pay TV subscribers.
HBO Max added 2.3 million subscribers to 128 million as HBO Max continues its global expansion. It will launch in Germany and Italy in the first quarter of 2026.
Streaming revenue was flat at $2.6 billion and profit rose 19% to $345 million.
WBD announced plans early this year to split its businesses in two but took a detour to put itself on the auction block last month after receiving three bids from Paramount’ new owner, David Ellison – the latest for $23.50. WBD rebuffed all three and formally opened the door to other suitors, hiring an investment bank and setting up a data room. Netflix, Comcast and Amazon-MGM have been circling. Talks continue with Ellison. He’s look to buy the whole company, although WBD is also entertaining offers for parts.
Deadline hears that if there is to be a transaction, WBD would hope to declare that by year end. If none materializes, it will move forward with a split of its studio and streaming (Warner Bros.) from linear television (Discovery Global) by mid-2026.
WBD paid down $1.2 billion of debt in the quarter.
CEO David Zaslav will host a call at 8 am ET.
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