Warner Bros. Discovery Inc - Class A
Q1 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +6.73%.
Did WBD Beat Earnings? Q1 2025 Results
Warner Bros. Discovery delivered a disappointing first quarter, missing on both the top and bottom lines as the ongoing collapse of its linear TV business and a thin theatrical slate weighed heavily on results. Revenue fell 9.8% year-over-year to $8.98 billion, coming in 6.49% below the $9.60 billion consensus, while the adjusted loss per share of $0.18 missed estimates of $0.13 by 39.00%, with the shortfall driven largely by a 27% ex-FX plunge in content revenues tied to the absence of marquee theatrical releases that had boosted the year-ago period. Yet the streaming narrative offered genuine encouragement, with Max adding 5.3 million subscribers to reach 122.3 million globally and streaming Adjusted EBITDA surging to $339.00 million from $86.00 million a year ago, reinforcing management's confidence in delivering at least $1.30 billion in streaming Adjusted EBITDA for full-year 2025. Post-quarter box office momentum, including A Minecraft Movie approaching $900.00 million globally, and the Superman release slated for July 11, underpin the case for a meaningful Studios recovery, even as S&P's recent downgrade of WBD's debt to junk status serves as a pointed reminder of the structural pressures still confronting the business.
- Streaming subscriber growth of 5.3 million sequentially to 122.3 million globally
- Streaming advertising revenue up 35% ex-FX driven by ad-lite subscriber growth
- Streaming Adjusted EBITDA increased to $339M from $86M YoY
- Studios Adjusted EBITDA up 63% ex-FX despite lighter theatrical slate
- Games content expense decreased 66% ex-FX due to prior year Suicide Squad impairment
- Corporate costs improved by $113M driven by release of non-income tax reserves, lower facility costs, and lower securitization expense
- Content hits including The White Lotus Season 3 (25M+ global viewers per episode), The Pitt (12M+ worldwide viewers per episode)
- Distribution revenue growth from 2% increase in domestic affiliate rates
Forward Guidance & Outlook
WBD reiterated confidence in delivering at least $1.3 billion of Streaming Adjusted EBITDA in 2025 and surpassing 150 million streaming subscribers by end of 2026. Management expressed greater conviction in a strong year-over-year improvement in full-year Studios Adjusted EBITDA, with a long-term target of at least $3 billion. Post-quarter film momentum is strong with A Minecraft Movie (~$900M global box office), Sinners (~$250M), and Superman arriving July 11. In Q2, a large licensing renewal with the Streaming segment will benefit Studios. For Global Linear Networks, the absence of the Final Four partially offset by Stanley Cup Finals carriage is expected to create a net 2% YoY headwind to Q2 advertising revenues. Q2 Global Linear Networks cost of revenues expected to increase YoY due to new sports rights (French Open, NASCAR) and production expenses. The company continues to target 2.5-3x gross leverage. Max is expected to be available in over 85 markets by year-end 2025, with launches in the U.K., Ireland, Italy, and Germany planned for early 2026. Management acknowledged macroeconomic uncertainty, particularly around advertising sensitivity, but noted no material impact to date.
WBD YoY Financials
WBD Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.