Netflix is to acquire the filming and streaming business of Warner Bros for $72bn (£54bn).
The transaction will include franchises such as Harry Potter, The Big Bang Theory, The Sopranos, Game of Thrones, DC Universe and more.
Netflix said it had entered into a “definitive agreement” which will see it buy the company’s film and television studios, HBO Max and HBO.
The cash and stock transaction is valued at $27.75 per WBD share and is expected to close after the separation of WBD’s Global Networks division, Discovery Global, into a new publicly-traded company, which is now expected to be completed in Q3 2026.
“Our mission has always been to entertain the world,” said Ted Sarandos, co-CEO of Netflix.
“By combining Warner Bros.’ incredible library of shows and movies—from timeless classics like Casablanca and Citizen Kane to modern favourites like Harry Potter and Friends—with our culture-defining titles like Stranger Things, KPop Demon Hunters and Squid Game, we’ll be able to do that even better. Together, we can give audiences more of what they love and help define the next century of storytelling.”
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Greg Peters, co-CEO of Netflix continued:
“This acquisition will improve our offering and accelerate our business for decades to come.
“Warner Bros. has helped define entertainment for more than a century and continues to do so with phenomenal creative executives and production capabilities. With our global reach and proven business model, we can introduce a broader audience to the worlds they create—giving our members more options, attracting more fans to our best-in-class streaming service, strengthening the entire entertainment industry and creating more value for shareholders.”
The streaming giant says the merger would create “more choice, more opportunities and more value.”
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However, some believe that it is likely to lead to subscription rises.
“There will be resistance from parts of Hollywood and various unions,” said Tom Harrington, Head of Television at Enders Analysis.
“For consumers, this would likely result in rising costs: Netflix would get more expensive and even though HBO Max would be shuttered/become non-essential, the greater penetration of Netflix households would likely mean an increase in total overall subscription revenues.”
David Zaslav, President and CEO of Warner Bros. Discovery said:
“Today’s announcement combines two of the greatest storytelling companies in the world to bring to even more people the entertainment they love to watch the most.
“For more than a century, Warner Bros. has thrilled audiences, captured the world’s attention, and shaped our culture. By coming together with Netflix, we will ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come.”
Netflix also said that the deal would enhance its studio capabilities – “allowing the Company to significantly expand U.S. production capacity and continue to grow investment in original content over the long term which will create jobs and strengthen the entertainment industry.”
Netflix stated that it expected to realise “at least $2-3 billion of cost savings per year” by the third year and expects the transaction to be accretive to GAAP earnings per share by year two.
In June 2025, WBD announced plans to separate its Streaming & Studios and Global Networks divisions into two separate publicly traded companies.
Discovery Global, will include entertainment, sports and news television brands such as CNN, TNT Sports in the U.S., and Discovery, free-to-air channels across Europe, and digital products such as Discovery+ and Bleacher Report.
Completion is subject to regulatory approvals and approval of WBD shareholders.
Before the deal was confirmed, former WarnerMedia CEO, Jason Kilar wrote on social media:
“If I was tasked with doing so, I could not think of a more effective way to reduce competition in Hollywood than selling WBD to Netflix.”
Since the news was announced, Netflix’s share price has fallen slightly by 0.31%.
Cinema United said of the move:
“The negative impact of this acquisition will impact theatres from the biggest circuits to one-screen independents in small towns in the United States and around the world,” said Cinema United President and CEO Michael O’Leary.
“Cinema United stands ready to support industry changes that lead to increased movie production and give consumers more opportunities to enjoy a day at the local theatre. But Netflix’s stated business model does not support theatrical exhibition. In fact, it is the opposite. Regulators must look closely at the specifics of this proposed transaction and understand the negative impact it will have on consumers, exhibition and the entertainment industry.”
