Warner Bros reports sales slowdown as takeover battle stretches on
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The new: Warner Bros Discovery reported lower sales and earnings for the fourth quarter as the company weighs up competing takeover offers from Netflix and Paramount Skydance.
The numbers: Warner Bros fourth-quarter revenue fell 6% to USD9.46 billion, while adjusted EBITDA shrank to USD2.22 billion from USD2.72 billion the prior year quarter.
While revenue for the company’s television networks, its largest unit, fell 12% to USD4.2 billion and adjusted EBITDA plummeted 27% to USD1.41 billion, Warner Bros’ saw streaming subscribers reach almost 132 million amid its international HBO Max rollout. It anticipates reaching more than 150 million subscribers by year end, a letter to shareholders reads.
The context: The data comes as Warner Bros is in the thick of a tense bidding war between Netflix and Paramount Skydance. Earlier this week Paramount raised its bid for the entire company from USD30 to USD31 per share, as it hopes to undo Warner Bros’ agreed takeover with Netflix.
A letter to shareholders published alongside Warner Bros’ earnings said that the board “continues to engage” with Paramount to determine if a superior proposal can be reached. It added that the board recently determined that the latest proposal from Paramount Skydance could reasonably be expected to lead to a “Company Superior Proposal”.
Warner did not respond to questions on the transaction during its earnings call.
