Warner Bros. Discovery leaders David Zaslav and JB Perrette talked up the potential of upcoming slates for Warner Bros. and HBO Max and the future of Discovery Global linear channels Thursday morning in an earnings conference call that awkwardly avoided the biggest question of hovering over the studio.
The status of WBD’s M&A tug-of-war between Netflix and Paramount Skydance was not addressed, given that the WBD board is in the thick of deciding what to do about the latest offer fielded by Paramount. Many of the questions from analysts on the 40-minute Q4 earnings call dealt with specifics around the planned spinoff of Discovery Global.
But the fate of CNN, TNT, Discovery Channel, HGTV, Food Network et al hinges on who wins the bidding skirmish. Netflix, which has a signed acquisition agreement with WBD, will not acquire the linear channels while Paramount Skydance does hope to buy the entirety of the company. Gunnar Wiedenfels, WBD’s chief financial officer who is tabbed to lead the Discovery Global spinoff as CEO, answered questions as if the spinoff is proceeding.
The valuation of the Discovery Global channels has become a sticking point in the consideration of Netflix vs. Paramount Skydance. The Discovery Global spinoff has been slated to take on a big chunk of the $33 billion in long-term debt that now sits on WBD’s balance sheet. Wiedenfels asserted that the spinoff would emerge with a 3.3 debt-to-earnings ratio, which he called “absolutely sustainable and supportable.” The focus from analysts on Discovery Global questions indicated that they are trying to crunch the numbers on the latest offer from Paramount while everyone watches to see if Netflix ups the ante on its $83 billion agreement to acquire Warner Bros. and HBO.
Zaslav, meanwhile, once again forcefully made the case for how the company has been transformed since AT&T’s WarnerMedia and Discovery Inc. merged in April 2022.
“It’s been a great creative renaissance at Warner Bros., and you see it across our entire company, and you’ll continue to see it,” Zaslav told analysts. “When you look at ’27 on the motion picture side, it’s stunning. It’s all coming together for Warner and for HBO as well. HBO has never been stronger.”
Zaslav pointed to the streak that Warner Bros. Pictures has enjoyed with nine movies in the past 14 months that have opened at No. 1 at the box office. 2025’s “A Minecraft Movie,” “Sinners,” “Weapons” and “One Battle After Another” are good examples of the range of franchise and prestige fare that the studio has balanced since Michael De Luca and Pam Abdy took over as film studio chiefs.
“I don’t think anybody is investing in original content and television and motion pictures the way we have,” Zaslav enthused.
Perrette, who oversees global streaming and gaming for WBD, noted that HBO is banking on some 10 years of Harry Potter-branded series starting next year. “We have great visibility to a strengthening content plate, which is at the core of everything we do,” Perrette said.
As for WBD’s gaming business, Perrette acknowledge that “2025 was a year of reset” after the division got “distracted going after too many IPs with too broad a set fo studios.” This year, WBD is slated to release a new “Lego Batman” game and a “Game of Thrones”-themed mobile game dubbed “Dragon Fire.”
Perrette hinted of bigger things to come next year.
“The real fruits will start coming in in ’27-’28 when we return to some of our biggest franchises,” he said. Perrette didn’t specify any titles but it’s likely he was referencing the push for the studio to release a “Hogwarts Legacy” game sequel that will coincide with the debut of HBO’s Harry Potter series.