Asked what aspects of Warner Bros. and HBO content/IP are now being appreciated and the difficulty of building new franchises.

David Zaslav explained that the company's focus on investing in original content and reviving great franchises, coupled with a strong creative leadership team, was previously overlooked. He highlighted the success of original films like 'Sinners' and 'Weapons' and the revival of IP like 'Minecraft,' which is returning with a sequel after making almost $1 billion. He emphasized the company's commitment to storytelling and the Motion Picture business. “What I think was missed was we hired a great leadership team, creative leadership team, and we invested enormously in this mission of this question that we ask ourselves all the time that what stories will we tell at this great company at Warner Bros, at HBO and Warner Bros. Television.”

Sought a breakdown of drivers for the internal forecast of Streaming profits tripling by 2030.

JB Perrette outlined five levers: strengthening content slate (e.g., 10 years of Harry Potter), volume and penetration growth (new market launches, password sharing enforcement starting 2026), product enhancements for engagement/retention, continued improvement in churn/retention, and monetization through subscription pricing and ad sales (low international fill rates, new ad-tier launches). “And the last is just monetization, which is obviously a combination of both price on the subscription side, and ad sales where we are very early in the ad sales growth trajectory based on the fact that our fill rates are still relatively low internationally, and we're still launching in new markets with our ad tiers, and we think there's further upside in the years to come.”

Asked about the profitability of international DTC expansion, the need for more programming dollars, and local content requirements.

JB Perrette stated that international businesses have outperformed profitability metrics, turning profitable within 1-2 years of launch in most markets. He noted that WBD's global IPs (DC, Game of Thrones) appeal broadly, reducing the need for extensive local content. While selective local content investment continues (e.g., Turkey, Korean content partnership with CJ), no major step change in programming dollars is needed for continued growth. “Our need to do a lot of local international content is a little bit different than other players, number one. Number two is we are doing and have been doing select international content in markets that either there is a particular need or where the content seems to travel better than in most places.”

WBD

Warner Bros. Discovery (WBD) Q4 FY25 earnings call: guidance and Q&A

Earnings call· Dec 2025 (Q4 FY25)· Communication Services· Feb 26, 2026

Source: earnings call transcript

Executive summary

Warner Bros. Discovery Q4 FY25 — Strong Creative Performance and Streaming Growth

Warner Bros. Discovery reported a quarter marked by a creative renaissance across its film and television studios, driving strong streaming subscriber growth and resilient linear network performance. The company is aggressively investing in original content and iconic IP, while strategically navigating the spin-off of Discovery Global and evaluating sales processes to maximize shareholder value. Management expressed confidence in the future profitability of its streaming business and the sustainability of Discovery Global's leverage profile.

Highlights

Warner Bros. Motion Picture Group delivered 9 films debuting #1 at the box office in 2025, with 7 consecutive films opening over $40 million.
HBO Max exceeded its 130 million subscriber target in Q4 FY25, with plans to reach over 140 million by end of Q1 2026 and over 150 million by end of 2026.
HBO series like IT: Welcome to Derry averaged 27 million viewers per episode, and A Knight of the Seven Kingdoms averaged over 24 million viewers per episode.
Global Linear Networks attracted 30% of all prime time cable viewing in the U.S. and saw sequential improvement in advertising trends in Q4 FY25, continuing into Q1 2026.
The 2026 Milano Cortina Olympic Winter Games saw over 50% growth in linear hours viewed and more than tripled the Streaming audience on HBO Max and Discovery+ throughout Europe.

Concerns

The games business experienced a 'reset' year in 2025, with 2026 expected to be similar, delaying significant growth until 2027-2028.
Domestic advertising faced a 400 basis points headwind from NBA in Q4 FY25, despite overall market consistency.
Global Linear Networks continue to face secular headwinds, though advertising trends showed sequential improvement.

Guidance & targets

Category	Target	Timeline	Confidence
Total Streaming Subscribers	over 140 million high materiality	Q1 · FY26	High
Total Streaming Subscribers	exceed 150 million high materiality	end of 2026 · FY26	High
International Ad Sales Growth	flat to slightly up medium materiality	this year · FY26	Medium
Discovery Global Net Leverage	roughly 3.3x high materiality	at spin-off	High
Streaming Profits	roughly triple high materiality	by 2030 · FY30	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Motion Picture Group Delivered a historic run of success in 2025 with strong box office performance and critical acclaim. Momentum continued into 2026 with 'Wuthering Heights' opening #1. Films debuting #1 at box office in 2025: 9Consecutive films opening with >$40M box office sales: 7Total weeks atop global box office in 2025: 16Golden Globe Awards won: 9Academy Award nominations: 30	—	—	—	—
HBO / HBO Max (Streaming) Continued to deliver hit series and strong viewership. HBO Max achieved significant subscriber growth globally, exceeding targets. IT: Welcome to Derry average viewers per episode: 27 millionHeated Rivalry average viewers per episode: 13 millionThe Pitt audience growth vs. prior season (Q1 2026): 30%Industry audience growth vs. prior season (Q1 2026): 50%A Knight of the Seven Kingdoms average viewers per episode: 24 million	—	—	—	—
Global Linear Networks Maintained strong viewership despite secular headwinds. Saw sequential improvement in advertising trends in Q4 FY25, continuing into Q1 2026. Olympics coverage drove significant linear and streaming audience growth in Europe. Share of prime time cable viewing in U.S.: 30%New cable TV series in top 25 (last year): 17	—	—	—	—
International Ad Sales Expected to outperform domestic ad sales trends in 2026, largely due to meaningful free-to-air presence in key markets.	—	flat to slightly up	—	—

WBD operating KPIs by quarter

WBD operating KPIs stated on its earnings calls, by fiscal quarter
KPI	Dec 2024 Q4 FY24	Mar 2025 Q1 FY25	Change vs prior quarter
Paid subscriber net additions Direct-to-Consumer	~6.5M We added about 6.5 million subscribers in the fourth quarter and nearly 20 million subscribers in less than a year. Source: earnings call transcript	5M+ And in the first quarter, we gained over 5 million subscribers and delivered $339 million in EBITDA. Source: earnings call transcript	—

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Product announcements

Product	Type	Timeline
CNN All Access	launch	—
LEGO Batman series	launch	May 2026
Dragonfire	launch	Summer 2026

Deals & partnerships

Multiple bidders (4) Sales process for Warner Bros. and Discovery Global

The Board is leading a rigorous, highly competitive, and thorough sales process, engaging with 4 bidders. The objective is to maximize value and certainty for shareholders.

CJ Partnership

Partnership focused on Korean content, which has a strong track record of traveling well globally.

Risks & headwinds

Secular headwinds for Global Linear Networks Ongoing

Unquantified

Mitigation:Evolving brands, accelerating digital future, empowering teams to adapt and innovate, launch of CNN All Access.

NBA headwind on domestic ad sales Q4 FY25

400 bps

Mitigation:Strong underlying audience delivery across other sports (MLB, NHL), CNN, and general entertainment; new upfront and good scatter premiums.

Games business reset and delayed growth 2025-2026

2025 was a 'reset' year, 2026 will be similar to 2025

Mitigation:Strategy shift to proven studios and IPs, with significant growth expected in 2027-2028 from returning to major franchises.

Q&A highlights

Inquired about the sustainability of Discovery Global's leverage post-spin-off (3-4x) and why it shouldn't be compared to Versant.

Gunnar Wiedenfels stated that Discovery Global is expected to launch with roughly 3.3x net leverage, which is absolutely sustainable. He highlighted the company's international scale, iconic brands, sports portfolio, profitable D+ business, and CNN's global news brand as key strengths. He also mentioned that rating agencies are expected to assign single B or low BB ratings, and the company is well-equipped to leverage its capital structure.

“Again, if you do the math based on what was disclosed in our proxy, you would see that Discovery Global would come out of the gate with roughly, call it, a 3.3x net leverage number. That is absolutely sustainable and supportable.”

asked by Richard Greenfield · answered by Gunnar Wiedenfels

3 min read 6 chapters

Detailed narrative

Creative Renaissance and Content Strategy

Warner Bros. Discovery has focused on investing in original content and reviving key IP, leading to a creative renaissance. The Motion Picture Group achieved a historic run in 2025 with 9 films debuting #1 at the box office and 7 consecutive films opening over $40 million.

HBO continued its success with breakout hits like 'IT: Welcome to Derry' and 'A Knight of the Seven Kingdoms', demonstrating strong viewership. The company emphasizes its commitment to original storytelling and leveraging its extensive library, with a robust slate planned for 2026 and 2027 across film and television.

Global Streaming Expansion and Growth Drivers

HBO Max has successfully scaled globally, exceeding 130 million subscribers in Q4 FY25 and targeting over 150 million by the end of 2026. This growth is driven by a strengthening content slate, recent launches in new markets (including European expansion), and ongoing product enhancements.

The company is also in the early stages of password sharing enforcement, which is expected to contribute to volume and penetration growth globally starting in 2026. Monetization efforts include pricing strategies and ad sales, with significant upside expected from ad-supported tiers in new markets.

Linear Networks Resilience and Advertising Trends

Despite secular headwinds, Warner Bros. Discovery's Global Linear Networks demonstrated resilience, attracting 30% of all prime time cable viewing in the U.S. The company saw a sequential improvement in advertising trends during Q4 FY25, which has continued into Q1 2026, driven by the new upfront, good scatter premiums, and strong underlying audience delivery across its diverse portfolio of networks.

International ad sales are expected to be flat to slightly up in 2026, outperforming domestic trends due to a significant free-to-air presence in key markets.

Games Business Reset and Future Pipeline

The games business underwent a 'reset' in 2025, shifting focus back to proven studios and IPs after previous unsuccessful launches. While 2026 is expected to be a similar year, the company anticipates significant growth starting in 2027-2028 with the return of major franchises.

Key releases for 2026 include the LEGO Batman series from TT Studios in May and 'Dragonfire,' a new mobile game from the successful Game of Thrones Conquest franchise, launching this summer. The strategy aims to build a more robust and financially successful game library.

Discovery Global Spin-off and Capital Structure

Management expressed strong confidence in the upcoming spin-off of Discovery Global, highlighting its sustainable capital structure with an expected net leverage of roughly 3.3x at launch. The CFO emphasized Discovery Global's global leadership in international markets, iconic brands, trusted journalism (CNN), and a world-class sports portfolio.

The company sees significant opportunities for growth in international ad sales, the profitable Discovery+ business, and leveraging its long-dated, low-interest capital structure post-separation.

Strategic Review and Shareholder Value

The Board is conducting a rigorous and competitive sales process for Warner Bros. and Discovery Global, which has already resulted in a 63% increase in value compared to the initial offer received in September. The focus remains on maximizing value and certainty for shareholders while mitigating risks.

This strategic action, alongside significant investments in creative culture and original storytelling, aims to build on the meaningful shareholder value created since the company's formation in April 2022.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.