Netflix has agreed to pay for Warner Bros. Discovery’s streaming and studio division entirely in cash to outmaneuver Paramount in the ongoing battle. This development is part of a larger story that could potentially reshape the global entertainment landscape. The announcement coincided with Netflix’s fourth-quarter earnings report, revealing a $72 billion US equity value deal, equating to $27.75 US per share. Netflix highlighted that this move accelerates the process towards a WBD shareholder vote and ensures clarity on the value to be delivered at closure.
The rivalry between Netflix and Paramount has been intensifying, with Netflix eyeing WBD’s studio operations and streaming library while Paramount aims to secure the entire company, including renowned assets like CNN and the Discovery+ streaming platform. Geetha Ranganathan, a senior media analyst at Bloomberg Intelligence, pondered whether this deal is a necessity or a desirable addition for Netflix. While the acquisition is deemed crucial for Paramount Skydance under new CEO David Ellison, it holds less significance for Netflix, whose subscriber growth has plateaued, prompting concerns among investors. Netflix is now banking on increased engagement to enhance its market position.
The extensive content library of Warner Bros., spanning iconic franchises such as “Harry Potter,” beloved TV series like “Friends” and “The Sopranos,” and timeless films like “Citizen Kane” and “Casablanca,” is expected to significantly elevate Netflix’s business potential, according to Ranganathan.
The narrative traces back to October 2025 when WBD announced plans to explore a sale following its decision to split into two entities, with Warner Bros. managing the studio and media library and Discovery Global overseeing properties like CNN and Discovery+. Subsequently, Paramount’s initial bid to acquire WBD in its entirety was reportedly rebuffed. Around the same time, Netflix faced challenges, missing its third-quarter earnings targets due to a tax dispute in Brazil, leading to investor apprehensions about its growth trajectory.
In November 2025, Netflix enhanced its bid for Warner Bros. by committing to continue releasing the studio’s films in theaters, a departure from its traditional streaming-centric approach. This move aimed to appease filmmakers and meet eligibility requirements for prestigious awards like the Oscars.
Fast forward to December 2025, Paramount escalated the bidding war by raising its proposed breakup fee and launching a hostile bid against WBD’s board and CEO David Zaslav. However, WBD eventually rejected Paramount’s bid in January 2026, urging shareholders to endorse the Netflix deal, emphasizing the risks associated with Paramount’s leveraged offer.
Looking ahead, with Netflix opting for an all-cash transaction, a shareholder vote on the deal is imminent, setting a crucial deadline for Paramount. The analyst, Ranganathan, pointed out uncertainties surrounding regulatory approvals and potential antitrust dilemmas for Netflix post-acquisition, raising questions about the fate of Warner Bros.’ film studio and HBO within the conglomerate.
