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Warner Bros. Discovery Q2 Earnings Beat Estimates, Revenues Rise Y/Y
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Key Takeaways
Warner Bros. Discovery beat Q2 earnings estimates with 63 cents per share vs expected loss of 16 cents.
WBD's streaming segment turned profitable at $293 million, reversing from $107 million loss last year.
The company added 3.4 million subscribers sequentially, reaching 125.7 million total subscribers.
Warner Bros. Discovery (WBD - Free Report) reported second-quarter 2025 earnings of 63 cents per share, in contrast to the Zacks Consensus Estimate of a loss of 16 cents. The company had incurred a loss of $4.07 per share in the year-ago quarter.
Revenues increased 1% year over year to $9.81 billion, which missed the Zacks Consensus Estimate by 0.15%. Ex-forex revenues remained flat year over year.
Advertising revenues decreased 10% ex-forex, as ad-lite streaming subscriber growth was more than offset by domestic linear audience declines. Distribution revenues were relatively unchanged, as growth in global streaming subscribers was offset by continued domestic linear pay TV subscriber declines. Content revenues increased 16% ex-forex, primarily driven by higher box office revenues due to the stronger performance of the theatrical releases in the current year quarter. Other revenues declined 19% year over year and were impacted by separation-related costs during the quarter.
Warner Bros. Discovery, Inc. Price, Consensus and EPS Surprise
WBD ended the second quarter of 2025 with 125.7 million global Max, HBO Max, HBO, and Discovery+ subscribers, which increased 3.4 million sequentially. Domestic average revenue per user fell to $11.16, primarily driven by the broader wholesale distribution of HBO Max basic with ads, while international ARPU came in at $3.85.
Warner Bros. Discovery shares have gained 13.6% year to date (YTD). The company’s closest peers, Paramount Global , Disney (DIS - Free Report) and Netflix (NFLX - Free Report) have appreciated 5.5%, 3.5% and 33%, respectively, YTD.
Post second-quarter 2025 results, WBD's subscriber base of 125.7 million continues to trail Disney+'s subscriber base but shows strong momentum with consistent quarterly growth. WBD reported an increase of 3.4 million subscribers sequentially in the second quarter.
WBD’s Q2 Quarter Details
The company reported revenues of $2.8 billion for streaming, up 9% year over year, and $3.8 billion for studios, up 55% year over year. Global Linear Networks' revenues decreased 9% year over year to $4.8 billion.
Under the Streaming segment, subscriber revenues grew 10% year over year to $2.7 billion. Content revenues fell 17% year over year to $102 million due to lower third-party licensing. Streaming eked out a profit of $293 million against a loss of $107 million a year ago.
Under the Studios segment, profits came in at $863 million, up from a profit of $210 million a year ago, due to strong performance, including major releases. Distribution revenues decreased 67% year over year to $1 million. Content revenues increased 61% year over year to $3.59 billion, while other revenues remained flat year over year at $219 million.
Under the Global Linear Networks segment, Distribution revenues decreased 7% year over year to $2.47 billion, while Advertising revenues plunged 12% year over year to $1.95 billion. Content revenues declined 4% year over year to $287 million while other revenues inched up 2% year over year to $86 million.
In the second quarter of 2025, adjusted EBITDA was $2 billion, up 9% year over year.
WBD’s Balance Sheet & Cash Flow
In conjunction with the announcement of the separation of Streaming & Studios and Global Linear Networks, the company successfully completed a tender offer and consent solicitation, as well as repaid the $1.5 billion term loan due 2026, financed by a $17 billion bridge facility, resulting in a $2.2 billion reduction in gross debt.
Additionally, the company repaid $0.5 billion of debt due in the quarter, resulting in a $2.7 billion total reduction in gross debt during the second quarter. Warner Bros. Discovery ended second-quarter 2025 with $35.6 billion of gross debt and 3.3x net leverage.
As of June 30, 2025, cash & cash equivalents were $4.88 billion compared with $3.89 billion as of March 31, 2025.
During the second quarter, the company amended its revolving credit facility credit agreement to reduce the facility size from $6 billion to $4 billion and to provide early termination of the agreement upon completion of the separation of Streaming & Studios and Global Linear Networks. As of June 30, 2025, the company’s revolving credit facility was undrawn.
Guidance
WBD is targeting at least 150 million streaming subscribers by the end of 2026 and anticipates the streaming segment will deliver a profit of approximately $1.3 billion in 2025.
For the Studios segment, Warner Bros. Discovery has provided guidance toward returning to $3 billion in EBITDA, driven by successful content releases and a robust pipeline.
Image: Bigstock
Warner Bros. Discovery Q2 Earnings Beat Estimates, Revenues Rise Y/Y
Key Takeaways
Warner Bros. Discovery (WBD - Free Report) reported second-quarter 2025 earnings of 63 cents per share, in contrast to the Zacks Consensus Estimate of a loss of 16 cents. The company had incurred a loss of $4.07 per share in the year-ago quarter.
Revenues increased 1% year over year to $9.81 billion, which missed the Zacks Consensus Estimate by 0.15%. Ex-forex revenues remained flat year over year.
Advertising revenues decreased 10% ex-forex, as ad-lite streaming subscriber growth was more than offset by domestic linear audience declines. Distribution revenues were relatively unchanged, as growth in global streaming subscribers was offset by continued domestic linear pay TV subscriber declines. Content revenues increased 16% ex-forex, primarily driven by higher box office revenues due to the stronger performance of the theatrical releases in the current year quarter. Other revenues declined 19% year over year and were impacted by separation-related costs during the quarter.
Warner Bros. Discovery, Inc. Price, Consensus and EPS Surprise
Warner Bros. Discovery, Inc. price-consensus-eps-surprise-chart | Warner Bros. Discovery, Inc. Quote
WBD’s Subscriber Base Increases in Q2
WBD ended the second quarter of 2025 with 125.7 million global Max, HBO Max, HBO, and Discovery+ subscribers, which increased 3.4 million sequentially. Domestic average revenue per user fell to $11.16, primarily driven by the broader wholesale distribution of HBO Max basic with ads, while international ARPU came in at $3.85.
Warner Bros. Discovery shares have gained 13.6% year to date (YTD). The company’s closest peers, Paramount Global , Disney (DIS - Free Report) and Netflix (NFLX - Free Report) have appreciated 5.5%, 3.5% and 33%, respectively, YTD.
Post second-quarter 2025 results, WBD's subscriber base of 125.7 million continues to trail Disney+'s subscriber base but shows strong momentum with consistent quarterly growth. WBD reported an increase of 3.4 million subscribers sequentially in the second quarter.
WBD’s Q2 Quarter Details
The company reported revenues of $2.8 billion for streaming, up 9% year over year, and $3.8 billion for studios, up 55% year over year. Global Linear Networks' revenues decreased 9% year over year to $4.8 billion.
Under the Streaming segment, subscriber revenues grew 10% year over year to $2.7 billion. Content revenues fell 17% year over year to $102 million due to lower third-party licensing. Streaming eked out a profit of $293 million against a loss of $107 million a year ago.
Under the Studios segment, profits came in at $863 million, up from a profit of $210 million a year ago, due to strong performance, including major releases. Distribution revenues decreased 67% year over year to $1 million. Content revenues increased 61% year over year to $3.59 billion, while other revenues remained flat year over year at $219 million.
Under the Global Linear Networks segment, Distribution revenues decreased 7% year over year to $2.47 billion, while Advertising revenues plunged 12% year over year to $1.95 billion. Content revenues declined 4% year over year to $287 million while other revenues inched up 2% year over year to $86 million.
In the second quarter of 2025, adjusted EBITDA was $2 billion, up 9% year over year.
WBD’s Balance Sheet & Cash Flow
In conjunction with the announcement of the separation of Streaming & Studios and Global Linear Networks, the company successfully completed a tender offer and consent solicitation, as well as repaid the $1.5 billion term loan due 2026, financed by a $17 billion bridge facility, resulting in a $2.2 billion reduction in gross debt.
Additionally, the company repaid $0.5 billion of debt due in the quarter, resulting in a $2.7 billion total reduction in gross debt during the second quarter. Warner Bros. Discovery ended second-quarter 2025 with $35.6 billion of gross debt and 3.3x net leverage.
As of June 30, 2025, cash & cash equivalents were $4.88 billion compared with $3.89 billion as of March 31, 2025.
During the second quarter, the company amended its revolving credit facility credit agreement to reduce the facility size from $6 billion to $4 billion and to provide early termination of the agreement upon completion of the separation of Streaming & Studios and Global Linear Networks. As of June 30, 2025, the company’s revolving credit facility was undrawn.
Guidance
WBD is targeting at least 150 million streaming subscribers by the end of 2026 and anticipates the streaming segment will deliver a profit of approximately $1.3 billion in 2025.
For the Studios segment, Warner Bros. Discovery has provided guidance toward returning to $3 billion in EBITDA, driven by successful content releases and a robust pipeline.
Zacks Rank & Earnings Estimate
Currently, Warner Bros. Discovery carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for third-quarter 2025 earnings is pegged at 17 cents per share, down by a penny over the past 30 days.