Warner Bros. Discovery Misses Big on Q4 Revenue

Warner Bros. Discovery’s revenue fell short of expectations in Q4 as the company lost more than $2 billion on linear, streaming, & studio.

Warner Bros. Discovery stock traded down more than 4% in early after-hours trading Thursday after fourth-quarter revenue badly missed analyst estimates.

Fourth-quarter revenue came in at $11.1 billion — well short of the $11.36 billion estimates — while quarterly losses came in at a total of $2.1 billion, or 86 cents per share. In a cool and reduced advertising market, flagship channels within WBD’s TV network such as TNT, TBS, and Discovery dipped 6% in revenue to roughly $5.5 billion.

Last year’s Warner Brothers-Discovery merger led to a mountain of debt, $45.5 billion of it compared to an estimated $3.9 billion of cash on hand. Reducing debt, cutting down costs, and further emphasizing streaming will be major company priorities in the coming fiscal year.

“With the major restructuring decisions behind us, this year we are focused on building and growing our businesses for the future, and we’re off to a great start,” WBD CEO David Zaslav said in the company’s earnings release.

Streaming revenue was up 6% in Q4, with an add of 1.1 million subscribers on its HBO Max and Discovery+ platforms. While streaming lost the company $217 million in the quarter, that’s $511 million less than in the previous year-over-year period. Lower TV licensing deals and fewer theatrical releases, including the box office bomb Black Adam, which lost a reported $50-100 million, contributed to a 23% decrease in its studio revenue.