Warner Bros. Discovery is celebrating another quarter of “profitability” in streaming, so go ahead and pop the champagne—just make sure CEO David Zaslav’s glass is filled first. After all, he’s got a $50 million salary to toast, even as his company scrambles to keep investors happy.
Let’s break it down: WBD ended 2024 with 116.9 million streaming subscribers, a number they generously bucket under the Direct-to-Consumer (DTC) label. But let’s not kid ourselves—this total includes folks who get HBO through their cable bundle, whether they actually use Max or even realize they’re counted. We’ve harped on this misleading metric before, and at this point, we’re exhausted. So, here it is: 116.9M*. There’s your asterisk.
To their credit, the DTC unit did post a quarterly profit of $409 million, a major improvement from last year’s $55 million loss. For the full year, they hit $677 million in streaming profits.
Meanwhile, linear networks (the division still bringing in real cash) saw a 5% revenue drop to $4.8 billion. Advertising revenue fell a painful 17%, thanks to audience declines and a continued collapse in the domestic TV ad market. But hey, WBD executives assure us there’s a “clear path” to 150 million global streaming subs by 2026. And if there’s one thing WBD excels at, it’s mapping out ‘clear paths’—even if the destination tends to shift along the way.
But let’s get to the real reason Wall Street didn’t seem to care that WBD missed revenue expectations and posted a $640 million quarterly loss: streaming growth. Investors saw the words “Max” and “profit” in the same sentence and decided that was good enough, pushing WBD shares up nearly 7%.
And to keep the magic going, WBD is doubling down on content bundling (because everything old is new again). CEO JB Perrette admitted that the industry spent the last decade overspending on content, and now WBD sees bundling as the key to a more sustainable strategy.
As for Zaslav, he remains the ultimate financial survivor. Despite WBD’s ongoing restructuring, layoffs, and write-downs, the man still pulls in $50 million a year. If that’s not a case study in corporate resilience, I don’t know what is.
But hey, as long as the stock keeps bouncing on the illusion of streaming profitability, does it really matter?
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