Warner Bros. Discovery streaming revenue climbs amid merger uncertainty

The streaming segment generated $500 million in adjusted EBITDA, bolstered by a content slate featuring House of the Dragon and Euphoria. Advertising revenue climbed 9% as the company expanded its ad-lite subscriber base globally. Yet, this progress faced a significant headwind: the loss of NBA broadcasting rights dragged down the year-over-year growth rate by 16%, underscoring the volatility inherent in the company’s sports-heavy portfolio.

Total company revenue reached $8.72 billion, missing Wall Street expectations of $9.29 billion and marking an 11% decline from the previous year. Net income plummeted to $149 million from $1.58 billion, a drop attributed to heavy restructuring costs and adjustments to intangible asset values. These financial pressures loom over the proposed combination with Paramount, where CEO David Ellison aims to merge HBO Max and Paramount+ into a single 200-million-subscriber powerhouse. While Ellison insists the HBO brand will remain untouched, the deal faces an uphill battle in court, with a trial scheduled for March to address antitrust concerns raised by state attorneys general.