Merger, Restructuring Costs Hit WBD Q3 Results

Warner Bros. Discovery, which closed the third quarter with almost 95 million direct-to-consumer subscribers, reported a net loss of $2.4 billion in the period on revenues of $9.8 billion as a result of merger and impairment costs.

“At Warner Bros. Discovery, we have one of the strongest portfolio of assets and IP across sports, news, and entertainment, and the best leadership team in media executing against the right strategy and financial framework to drive profitability, generate meaningful shareholder value, and ultimately position us for long-term success,” said David Zaslav, president and CEO. “We are reimagining and transforming the organization for the future while driving synergy enterprise-wide, increasing our target to at least $3.5 billion, and making significant progress on our combined DTC product. While we have lots more work to do, and there are some difficult decisions still to be made, we have total conviction in the opportunity ahead.”

In the studios segment, revenues were down 5 percent ex-FX to $3.1 billion, with content revenues falling 6 percent ex-FX as a result of lower home entertainment and TV licensing revenues. In the networks segment, revenues were $5.2 billion, an 8 percent reduction ex-FX, with ad revenues falling by 11 percent to $1.9 billion, distribution revenues rising 2 percent to $2.9 billion and content revenues falling 37 percent to $277 million. Direct-to-consumer revenues were $2.3 billion, including $2 billion in distribution revenues, $145 million in content revenues and $106 million in ad revenues. Total DTC subscribers were 94.9 million, an increase of 2.8 million global subscribers since the end of Q2, with 53.5 million in the U.S. and 41.4 million internationally. Global DTC ARPU was $7.52.