10-KPeriod: FY2025

Warner Bros. Discovery, Inc. Annual Report, Year Ended Dec 31, 2025

Filed February 27, 2026For Securities:WBD

Summary

Warner Bros. Discovery, Inc. (WBD) has experienced a transformative year ending December 31, 2025, marked by significant strategic decisions and ongoing operational adjustments. The company's financial performance reflects continued pressures on its linear networks segment, with declining distribution and advertising revenues. However, the Streaming segment demonstrated robust growth, with a 13% increase in total subscribers, primarily driven by the global expansion of HBO Max. The Studios segment also saw a notable increase in revenue and Adjusted EBITDA, buoyed by strong theatrical product performance. A pivotal development during the year was the company's proactive financial management, including substantial debt repurchases and a refinancing strategy, evidenced by the significant gain on extinguishment of debt. Despite these efforts, the company's leverage ratio remains a key focus for investors. The most significant event disclosed is the termination of the Netflix Merger Agreement in favor of the acquisition agreement with Paramount Skydance Corporation (PSKY) on February 27, 2026, which is set to acquire WBD for $31.00 per share in cash, plus potential ticking consideration. This transaction, pending regulatory and shareholder approval, signifies a major strategic shift for the company.

Financial Highlights

50 data points
Beta

Revenue

$37.30B

Net Income

$727.00M

1.9% Net Margin

EPS (Diluted)

$0.29

Total Assets

$100.08B

Cash & Equivalents

$4.57B

Free Cash Flow

$3.09B

Financial Statements
Beta
Revenue$37.30B
SG&A Expenses$9.42B
Operating Expenses$36.56B
Operating Income$738.00M
Net Income$727.00M
EPS (Basic)$0.29
EPS (Diluted)$0.29
Shares Outstanding (Basic)2.48B
Shares Outstanding (Diluted)2.53B

Key Highlights

  • 1The company is subject to a pending acquisition by Paramount Skydance Corporation (PSKY) for $31.00 per share in cash, plus ticking consideration, announced on February 27, 2026.
  • 2Streaming segment revenue grew 5% and subscriber base increased by 13% to 131.6 million, driven by global expansion of HBO Max.
  • 3Studios segment revenue increased 9%, with theatrical product revenue up 15% due to strong film performance.
  • 4Global Linear Networks segment revenue declined 12%, reflecting an 8% decrease in distribution revenue and a 13% decrease in advertising revenue, largely due to declining linear subscribers.
  • 5WBD recorded a gain on extinguishment of debt of $2.96 billion in 2025 due to substantial senior note repurchases.
  • 6Despite a significant goodwill impairment of $9.15 billion in the Global Linear Networks segment in 2024, the company's goodwill remained largely stable in 2025.
  • 7The company terminated its merger agreement with Netflix in connection with entering into the PSKY Merger Agreement, incurring a $2.8 billion termination fee paid by PSKY on behalf of WBD.

Frequently Asked Questions

On February 27, 2026, Warner Bros. Discovery, Inc. entered into an agreement to be acquired by Paramount Skydance Corporation (PSKY). The transaction is valued at $31.00 per share in cash, plus potential ticking consideration if the closing occurs after September 30, 2026. The completion of the PSKY Merger is subject to customary closing conditions, including regulatory approvals and shareholder approval.

The Streaming segment saw a 5% increase in revenue and a 13% rise in subscribers. The Studios segment experienced a 9% revenue increase, driven by strong theatrical performance. The Global Linear Networks segment continued to face challenges, with a 12% decline in revenue due to lower distribution and advertising revenues.

Warner Bros. Discovery, Inc. has a significant amount of debt, totaling $32.57 billion as of December 31, 2025. In 2025, the company actively managed its debt by repurchasing senior notes, resulting in a gain on extinguishment of debt of $2.96 billion. However, restrictive covenants in its debt facilities could limit operational flexibility.

The substantial improvement in net income from a loss of $11.31 billion in 2024 to a net income of $727 million in 2025 was primarily due to a large gain on the extinguishment of debt ($2.96 billion) and the absence of a significant goodwill impairment charge ($9.15 billion) that occurred in 2024. Increased profitability in the Studios and Streaming segments also contributed positively, while the Global Linear Networks segment's operating income declined.