Warner Bros. Discovery earnings tumble amid film studio struggles

Warner Bros. Discovery stumbled successful the 2nd quarter, demonstrating the hazard of depending heavy connected blockbuster returns from its Burbank movie studio.

Disappointing performances by “Supergirl” and “The Bride,” drove down quarterly theatrical gross by 46%. The tepid showing illustrated however the Warner Bros. workplace has fallen since past twelvemonth erstwhile it was riding precocious astatine the container bureau with “Sinners,” and “A Minecraft Movie.”

Warner’s lackluster earnings, released Thursday, comes arsenic tech scion David Ellison’s Paramount Skydance remains anxious to implicit its $111-billion woody to bargain Warner Bros. Discovery to harvester streaming operations and the storied movie workplace with Melrose Avenue’s Paramount Pictures.

Overall, nett for Warner Bros. Discovery, which besides is the genitor of HBO, CNN, TLC and HGTV, plummeted 91% to $149 million, oregon 6 cents per share, compared to $1.6 cardinal successful the 2nd 4th of 2025 amid the movie studio’s blazing run.

The institution besides fell abbreviated of Wall Street expectations for revenue, which sank 11% to $8.7 billion, contempt noteworthy gains successful its HBO Max streaming business.

Warner missed having NBA games connected its TNT channel, which contributed to a 27% driblet successful advertizing to $1.4 billion. The NBA’s departure, and the lack of the NHL Stanley Cup finals, contributed to a 17% ratings diminution astatine Warner’s cablegram networks.

Chief Executive David Zaslav opted not to renew the pricey hoops declaration arsenic Warner has been straining to wage down indebtedness brought connected by its past merger successful 2022. Instead, NBCUniversal picked up the NBA arrangement.

Warner executives disclosed the institution inactive is carrying astir $30 cardinal successful debt.

The company’s net revealed continued weakness successful the cablegram tv part amid user cord-cutting, which has slowed down successful caller quarters.

Still, the channels stay a important portion of Warner’s wide gross and nett picture.

Revenue to the planetary linear networks, which includes TNT, Discovery and planetary channels, declined 17% to $4 billion. Adjusted net earlier interest, taxes, depreciation and amortization successful that part fell 4% to $1.4 billion.

Despite the gloomy results, Warner’s banal climbed much than 1% successful aboriginal Thursday trading to $26.25. Investors seemed heartened by quality that British authorities person cleared Ellison’s projected takeover.

Britain’s Competition and Markets Authority recovered the Paramount-Warner operation would not restrict media contention successful Britain.

Warner investors are expecting much than $31 a stock should Paramount win successful its projected Warner Bros. purchase. The blockbuster acquisition has stalled amid an antitrust situation filed past period by California Atty. Gen. Rob Bonta and 11 different authorities attorneys.

Bonta’s coalition, including prosecutors from New York, Colorado, Minnesota and Nevada, contends the woody violates U.S. antitrust law.

“We’re assured this transaction volition close,” Zaslav told analysts connected an aboriginal greeting league call.

Earlier this week, a national justice scheduled a March 2, 2027 proceedings — months aboriginal than Paramount had hoped — to find whether the woody should determination forward.

Paramount faces a June 4 deadline to wrapper up the acquisition — oregon wage a $7 cardinal breakup interest to Warner.

Warner’s net agleam spot came from its streaming segment, which includes HBO.

Streaming gross grew 10% to $3 cardinal arsenic the institution continued its planetary rollout of HBO Max. The work benefits from Warner films, cartoons and HBO’s critically acclaimed archetypal contented including “Euphoria,” “Hacks,” “The Gilded Age” and “A Knight of the Seven Kingdoms,” which debuted earlier this year.

Adjusted net earlier interest, taxes, depreciation and amortization successful the streaming part soared 75% to $512 million.

Streaming main JB Perrette said his part was bullish astir adjacent twelvemonth erstwhile HBO volition present caller seasons of “The White Lotus,” “The Last of Us” and “The Pitt.”

Warner executives acknowledged their movie studio’s struggles. The institution does not interruption retired theatrical gross figures, but said full gross for the movie and tv studios declined 39% to $2.3 billion.

The studios’ adjusted net earlier interest, taxes, depreciation and amortization dropped 89% to $96 million.

Zaslav conceded Warner Bros. would merchandise less films this twelvemonth than it had initially anticipated due to the fact that immoderate weren’t acceptable for audiences. The workplace should merchandise 14 movies this twelvemonth but plans to boost its output to 19 adjacent year.

“We’re precise assured that we’re going to beryllium capable to support that larger number,” Chief Financial Officer Gunnar Wiedenfels said connected the call.

The workplace volition rebound, Zaslav said.

“Next year, we’re going to person ‘Lord of the Rings,’ ‘Batman,’ ‘Superman,’ [and] ‘Minecraft’ too,” Zaslav said. “Our wide doctrine [is] making definite that we bring the question representation to the marketplace erstwhile the movie is ready.”

Ellison, successful his bid for Warner Bros., has promised regulators that the combined workplace would merchandise 30 films a twelvemonth — an magnitude that immoderate experts judge is overly ambitious.

Late Wednesday, Regal Global Entertainment Chief Executive Eduardo Acuna cited Ellison’s committedness to a beardown pipeline successful announcing his theatre chain’s enactment for the Paramount-Warner Bros. merger.

“We request a thriving workplace strategy to guarantee that the manufacture has a level from which to grow,” Acuna said successful a statement. “I judge David is sincere successful making these commitments, and helium has offered to execute a consent decree to the State AGs. These are tangible and important commitments that volition payment the industry.”

Staff writer Samantha Masunaga contributed to this report.