Warner Bros. Discovery reaches 128 million subscribers in Q3 2025

Warner Bros. Discovery reported third quarter 2025 results on November 6, 2025, demonstrating continued momentum in streaming subscriber growth and studio performance while facing advertising revenue headwinds across its traditional television networks. The media company added 2.3 million net subscribers during the quarter to reach 128 million global streaming subscribers, marking 16% growth year-over-year as the company advances toward its target of 150 million subscribers by the end of 2026.

Total revenues declined 6% on an ex-foreign exchange basis to $9.0 billion compared to the prior year quarter, according to the company's earnings announcement. Excluding the impact of the 2024 Olympics sublicensing in Europe, revenues were flat year-over-year. The company's net loss available to shareholders was $148 million, which included $1.3 billion of pre-tax acquisition-related amortization of intangibles, content fair value step-up, and restructuring expenses.

Adjusted EBITDA reached $2.5 billion in the third quarter, representing a 2% increase ex-foreign exchange compared to the prior year quarter. This growth was primarily driven by the Streaming and Studios segments, which together form the Streaming & Studios division that delivered 7% revenue growth and 59% adjusted EBITDA growth ex-foreign exchange year-over-year. The company expects Studios to meaningfully exceed its prior guidance of at least $2.4 billion in adjusted EBITDA for 2025, while Streaming will contribute over $1.3 billion in adjusted EBITDA for the year.

Distribution revenues decreased 4% ex-foreign exchange during the quarter. This decline reflects the first full quarter impact of an HBO Max domestic distribution deal renewal with a former related party, which had been disclosed in the second quarter. Dynamic growth in global streaming subscribers was more than offset by continued domestic linear pay-TV subscriber declines. The company also recognized a negative adjustment for prior period revenues related to an international legal matter, which equated to roughly a 200 basis point adjustment.

Advertising revenues fell 17% ex-foreign exchange as ad-lite streaming subscriber growth failed to offset domestic linear audience declines. Excluding the impact of the 2024 Olympics, which provided comparison difficulties, advertising revenues still declined significantly. The third quarter is typically the company's smallest advertising quarter. The absence of the NBA, which was simulcast on HBO Max throughout the 2024-25 season, is expected to create a negative 300 basis point impact on streaming advertising revenues during the fourth quarter, with greater headwinds during the first half of 2026.

Content revenues decreased 3% ex-foreign exchange, primarily driven by the sublicensing of Olympic sports rights to broadcast networks throughout Europe in the prior year. This decline was partially offset by stronger theatrical releases in the current quarter. Excluding the Olympics impact, content revenues increased 23% ex-foreign exchange.

Warner Bros. Motion Picture Group delivered strong performance during the quarter, becoming the first studio to surpass $4 billion in 2025 global box office revenue despite releasing only 11 films. Nine Warner Bros. films opened at number one at the global box office with 15 total weekends at number one, leading all studios on both metrics. Year-to-date, Warner Bros. has produced and distributed three of the top five domestic films and four of the top 10 internationally based on box office gross, according to CFO Gunnar Wiedenfels.

The company's theatrical slate during the third quarter included several notable releases. Superman marked a new era for DC Studios in its first theatrical release. The horror genre continued to demonstrate strength with Weapons and The Conjuring: Last Rites, which together grossed more than $750 million in ticket sales. Weapons debuted as the largest August horror film opening of all time domestically. The company also released Paul Thomas Anderson's One Battle After Another, reinforcing its commitment to producing original works by top filmmakers.

Warner Bros. Television was recognized with 14 Emmy Awards, including Outstanding Drama Series for The Pitt and nine Emmy wins for The Penguin. WBTV remains one of the most prolific suppliers of episodic television in the industry with over 70 active series being delivered across 20 platforms. The company expects that 2026 will mark the first time that WBTV will deliver more scripted episodes to streaming platforms than broadcast and cable networks.

HBO and HBO Max were recognized with 30 total Emmy Awards, tied for the most of any network or platform, with wins for 12 original programs spanning drama, comedy, documentaries, variety series, and specials. Recent HBO Original series Task averaged 12 million viewers per episode, growing its audience every week during its run. IT: Welcome to Derry, which premiered in late October, ranked as one of HBO Max's top all-time premieres with 15 million viewers in its first week.

HBO Max is now available in more than 100 global markets following its recent launch in several smaller markets in EMEA and APAC. The platform's strong performance in Australia following its launch earlier in 2025 has bolstered confidence in upcoming launches in Italy, Germany, the United Kingdom, and Ireland during the first quarter of 2026. Like Australia, these markets have previously licensed HBO and WB Studios content to distributors, creating familiarity with the HBO brand and key titles.

The company continues to refine its content offering, consisting of tentpole titles, pay-one films, and relevant local language content. In 2025, the company has seen record performance of local original productions across Latin America and Europe, including Chespirito from Mexico, The Eastern Gate from Poland, and When No One Sees Us in Spain. The company recently announced a content production and distribution partnership with CJ ENM, a leading entertainment company in Korea, making HBO Max the streaming home of new original K-dramas.

Streaming advertising revenue growth has become increasingly important across the industry. According to industry projections, streaming TV advertising is expected to surge by 19.3% in 2025, while linear TV faces a 3.4% decline. The transformation of the television advertising landscape reflects broader changes in viewer behavior and advertiser requirements as streaming platforms mature.

Global Linear Networks revenue and adjusted EBITDA declined 23% ex-foreign exchange and 20% ex-foreign exchange year-over-year, respectively. Excluding the Olympics impact, revenues decreased 12% ex-foreign exchange. As expected, the advertising revenue decline year-over-year worsened sequentially, partially due to a 300 basis point combined impact from the 2024 Olympics and difficult comparisons at CNN against last year's coverage of the presidential election. Underlying U.S. linear advertising trends remain largely consistent with prior quarters as demand for sports continues to be healthy and demand for general entertainment is steady.

The company recently launched CNN All Access, a new streaming subscription tier priced at $6.99 per month. This new tier provides one centralized destination for CNN's journalism, including live and on-demand video programming. Pay-TV subscribers can also access CNN All Access by authenticating their subscriptions. The company is also making progress on a TNT Sports streaming service in the U.S., which will provide consumers with access to all sports content available on TNT Sports linear networks, as well as select content from Bleacher Report and House of Highlights.

Warner Bros. Discovery generated $701 million of free cash flow during the third quarter, which included approximately $500 million in separation-related costs. The company repaid $1.2 billion of debt during the quarter, including $1 billion of the bridge loan facility, and ended the quarter with net leverage of 3.3x. The company had $4.3 billion of cash on hand and $34.5 billion of gross debt at quarter end.

The company's previously announced plan to separate into two publicly traded companies remains on track for completion by mid-2026. The separation will establish WBD Streaming & Studios and WBD Global Networks as independent public companies. David Zaslav will lead WBD Streaming & Studios following the separation, while Gunnar Wiedenfels will serve as President and CEO of WBD Global Networks.

On October 21, 2025, the Board of Directors announced its decision to initiate a review of strategic alternatives. According to the announcement, the Board is evaluating a broad range of strategic options, including proceeding with the planned separation, a potential transaction for the entire company, or separate transactions for the Warner Bros. and Discovery Global businesses. As part of the review, the company will also consider an alternative separation structure that would enable a merger transaction involving Warner Bros., while Discovery Global would be spun off to shareholders.

The company's operating segments demonstrated varying performance during the quarter. The Streaming segment once again delivered healthy subscriber growth, with 2.3 million net subscribers added to reach 128 million global streaming subscribers. Subscriber growth was attributable to penetration gains from existing markets and strong consumer uptake in newer markets such as Australia. Streaming adjusted EBITDA grew 24% ex-foreign exchange year-over-year in the third quarter.

Looking to the fourth quarter, distribution revenue growth is expected to be in the low single digit range. The absence of the NBA, which was simulcast on HBO Max throughout the 2024-25 season, is expected to have a negative 300 basis point impact on streaming advertising revenues during the quarter. As the company prepares for the launch of HBO Max in Germany and Italy in the first quarter of 2026, it expects to incur modest upfront marketing and startup costs during the latter part of the fourth quarter.

For Global Linear Networks, even with an anticipated negative 400 basis point impact to global advertising revenue due to the absence of the NBA, the company expects the strength of the MLB playoffs and new sports rights to drive improved year-over-year advertising trends compared to the third quarter. Some of the NBA cost savings have been reinvested in new sports rights and related production expenses, primarily Big 12 football and basketball and Big East basketball, as well as in content and marketing for digital initiatives like CNN All Access.

The company's major sports rights deals are secure with no near-term renewals. Management indicated it intends to continue intelligently pursuing rights that may become available and are additive to the current offering. The team is making progress on the TNT Sports streaming service in the U.S., which will be made available as a standalone service while simultaneously looking for bundling opportunities.

International advertising continues to demonstrate greater resilience across key markets, particularly in EMEA, where the company has also benefited from a strong share of viewership in free-to-air markets. The free-to-air share has increased in each of the last three full years through 2024, while the third quarter of 2025 matched a best-ever quarterly performance to date.

Warner Bros. Discovery's measurement technology partnerships have also advanced during 2025. The company announced a multi-year agreement with VideoAmp on July 24, 2025, expanding their partnership to provide currency optionality and advanced data and measurement solutions across linear, digital, and cross-platform campaigns with demographic and audience guarantees. The partnership supports the company's StreamX platform, which unifies media planning, activation, and measurement across linear TV, digital, and streaming platforms.

The company expects further healthy free cash flow generation during the fourth quarter. Management plans to prioritize allocation of free cash flow to ensure that both Warner Bros. and Discovery Global have appropriate capital structures and operating cash on hand to fund post-separation operating plans.

Timeline

• June 9, 2025: Warner Bros. Discovery announces plan to separate into two publicly traded companies
• July 9, 2025: Company restores HBO Max brand name after two-year Max experiment
• July 24, 2025: VideoAmp and Warner Bros. Discovery sign multi-year measurement deal
• September 21, 2025: RTL Deutschland announces Warner Bros. Discovery volume deal and DFB-Pokal broadcasting rights
• October 21, 2025: Board of Directors announces review of strategic alternatives
• November 6, 2025: Company reports third quarter 2025 results

Summary

Who: Warner Bros. Discovery, a global media and entertainment company led by President and CEO David Zaslav, CFO Gunnar Wiedenfels, and CEO and President of Global Streaming and Games JB Perrette.

What: The company reported third quarter 2025 financial results including $9.0 billion in total revenues (down 6% ex-foreign exchange), 2.3 million net subscriber additions reaching 128 million global streaming subscribers, $2.5 billion in adjusted EBITDA (up 2% ex-foreign exchange), and $701 million in free cash flow. The company also announced strong studio performance with Warner Bros. becoming the first studio to surpass $4 billion in 2025 global box office revenue.

When: Third quarter results were for the period ended September 30, 2025, with the earnings announcement and shareholder letter released on November 6, 2025. The company expects to complete its planned separation into two entities by mid-2026.

Where: Results reflect the company's global operations across more than 100 countries where HBO Max is available, including the United States, Canada, Latin America, Europe, and Asia-Pacific. The company reaches 1.1 billion unique viewers across 200 countries and territories through its Global Linear Networks division.

Why: The results matter for marketing professionals as they demonstrate the continued shift from linear to streaming advertising, with Warner Bros. Discovery's streaming segment expected to contribute over $1.3 billion in adjusted EBITDA in 2025 versus losing $2.5 billion three years ago. The company's advertising revenue challenges in linear television offset by streaming growth reflect broader industry trends, while its strong studio performance and planned separation create important implications for content production and distribution. The Board's review of strategic alternatives could reshape the competitive landscape for streaming advertising and content partnerships.