Warner Bros. Discovery (WBD) reported a fourth-quarter net loss of $640 million, with revenue totaling $10 billion. Advertising revenue in the company’s networks segment fell 17%, impacted by audience declines and continued weakness in the domestic advertising market.
Max added 6.4 million subscribers during the quarter, bringing its total to 116.9 million. The direct-to-consumer division, which includes Max, posted a $409 million profit, a shift from the $55 million loss in the same period the previous year. Revenue in this segment increased 5% to $2.7 billion, with advertising revenue rising 27%.
Networks, WBD’s largest segment, saw revenue decline 5% to $4.8 billion, with operating profits down 13% to $1.9 billion. The company secured renewal agreements with five of its six largest distribution partners.
The studios division reported a revenue increase of 16% to $3.7 billion. Television-related revenue rose 64%, driven by internal licensing agreements and a higher number of initial telecast deliveries following delays caused by the WGA and SAG-AFTRA strikes. Adjusted EBITDA for the studios unit increased 78% to $950 million.
Theatrical revenue decreased 9%, reflecting a lower number of releases. The gaming division saw a 29% decline in revenue and is undergoing restructuring.
Free cash flow for the quarter totaled $2.43 billion. Adjusted EBITDA across all divisions was reported at $2.72 billion, slightly exceeding the $2.65 billion forecast by analysts.
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Shares of WBD rose 6% in early trading before stabilizing. CEO David Zaslav addressed investors in a call, highlighting growth in streaming and the company’s ongoing restructuring. Analysts have speculated that WBD’s strategy could lead to a separation of its cable networks, following a trend seen in other media companies.
