Warner Bros. Discovery’s Wall Street nightmare is still in effect as its stock price continues to roll downhill after Thursday’s quarterly earnings, in which it reported a $9.1 billion write-down stemming from the loss of value of its linear TV networks.
As of Monday afternoon, WBD’s price on NASDAQ stands at $6.72/share, down 4.5% for the day — approximately 15% since the quarterly report was released and 42% from the start of 2024. The conglomerate’s market cap lost another $750 million since the close of trading this past Thursday and now stands at $16.45 billion, roughly a third of the $50 billion estimate the company had after WarnerMedia and Discovery completed their merger in April 2022.
Warner Bros.’ motion picture group had given CEO David Zaslav and his team a lot to smile about with hits like “Barbie,” “Wonka” and “Dune: Part Two,” but that has been erased by WBD’s continued struggles with the decline of linear TV, a problem exacerbated by Turner Sports’ loss of NBA TV rights following the 2024-25 season.
CFO Gunnar Wiedenfels told shareholders last week that losing the NBA was a “triggering event” for the company to take a one-time impairment charge that severely lowered the value of the TV assets on its books; but the industry-wide decline of linear TV, along with the advertising from that platform that media companies relied on for decades, was also a major factor.
The sinking stock price, fueled by Wall Street investors who were blindsided by the quarterly reports that fell well below projections, puts more pressure on Zaslav and his team to right the ship. WBD is focused on getting its streaming service, Max, to turn a profit. Upcoming seasons of hit HBO shows like “The Last of Us” and “The White Lotus” will be turned to for increases in subscriber counts, along with franchise spin-offs like “The Penguin” and “Dune: Prophecy.”
On the film division side, Warner Bros.’ presence at the summer box office has been virtually nonexistent with “Furiosa,” “Trap” and “Horizon: An American Saga” leaving little mark on theaters, but the upcoming one-two punch of the “Beetlejuice” and “Joker” sequels could change that this fall. Longer term, Warner Bros. is hoping that 2025 will bring a revival of its crown jewel IP, DC, with the reboot of the DC Cinematic Universe through James Gunn’s “Superman.”
