[2024 Group Prediction] Does Warner Bros. Discovery make a big comeback this year?  Shares just dropped 12% in Q4 as the company reported a net loss of $400M, but they ended 2023 with $6.16B in free cash flow, an 86% rise from the year before, after generating $3.31B in free cash flow.  Remember, they own Max (HBO), CNN, and more….

Nate

Recent signals from WBD suggest a spinoff of the cable channels may just be a matter of time. After the Financial Times reported last summer that management was contemplating such a step, executives didn’t exactly shoot the idea down when asked about it later. WBD has introduced a new corporate structure that separates the cable channels from streaming and the studio, seeming to make a split-up along those lines more likely. On Thursday, CEO David Zaslav said the new structure would “enhance our strategic flexibility and also create potential opportunities to unlock additional shareholder value.” That translates from corporate gibberish into plain English as: “Yes, we might dump these slowly dying channels the first chance we get.” 

https://www.ft.com/content/be716ec2-1c02-467c-94af-7c8ef9ae1963?utm_campaign=article_email&utm_content=article-14575&utm_medium=email&utm_source=sg

Recent signals from WBD suggest a spinoff of the cable channels may just be a matter of time. After the Financial Times reported last summer that management was contemplating such a step, executives didn’t exactly shoot the idea down when asked about it later. WBD has introduced a new corporate structure that separates the cable channels from streaming and the studio, seeming to make a split-up along those lines more likely. On Thursday, CEO David Zaslav said the new structure would “enhance our strategic flexibility and also create potential opportunities to unlock additional shareholder value.” That translates from corporate gibberish into plain English as: “Yes, we might dump these slowly dying channels the first chance we get.”   https://www.ft.com/content/be716ec2-1c02-467c-94af-7c8ef9ae1963?utm_campaign=article_email&utm_content=article-14575&utm_medium=email&utm_source=sg

Group behind CNN and HBO has discussed options including spin-off of its streaming service and movie studio

Warner Bros Discovery drafts break-up plan

Bobby

If you’re watching the latest season of the HBO drama “The White Lotus,” you’ll know that the aging cable channel (represented on streaming through Max) can still capture the zeitgeist. That’s not so true of HBO’s owner, Warner Bros. Discovery, whose fourth-quarter results on Thursday—showing revenue fell 2% for the quarter and 5% for the year—demonstrated the sorry state of the traditional TV business that makes up much of WBD. 

The company’s streaming operations are doing fine, expanding its subscriber base 20% in 2024, mostly overseas where Max is moving into new markets. But as the slowly shrinking cable channels account for half of WBD’s revenue, streaming’s growth can only do so much. Things would be much easier if WBD spun off the cable channels, as Comcast’s NBCUniversal is already doing. WBD’s streaming business is profitable, and a new company composed just of streaming, HBO and the Warner film studio should prosper—drawing a much better valuation than the company does now.

Consider that WBD’s stock price has been bobbing around the $10 level for the past 17 months, giving the company an enterprise value now of just $61 billion. That’s roughly one-seventh the value Netflix enjoys, even though the two companies had the same revenue last year. Netflix deserves a good premium, no question. Apart from anything else, it’s much more profitable: Netflix generated free cash flow of $6.9 billion last year compared with WBD’s $4.4 billion. But the valuation difference is mostly owing to the fact that half of WBD is steadily shrinking.

https://www.forbes.com/sites/joecornell/2024/11/26/comcast-plans-to-spin-off-its-cable-networks-and-digital-assets/

If you’re watching the latest season of the HBO drama “The White Lotus,” you’ll know that the aging cable channel (represented on streaming through Max) can still capture the zeitgeist. That’s not so true of HBO’s owner, Warner Bros. Discovery, whose fourth-quarter results on Thursday—showing revenue fell 2% for the quarter and 5% for the year—demonstrated the sorry state of the traditional TV business that makes up much of WBD.   The company’s streaming operations are doing fine, expanding its subscriber base 20% in 2024, mostly overseas where Max is moving into new markets. But as the slowly shrinking cable channels account for half of WBD’s revenue, streaming’s growth can only do so much. Things would be much easier if WBD spun off the cable channels, as Comcast’s NBCUniversal is already doing. WBD’s streaming business is profitable, and a new company composed just of streaming, HBO and the Warner film studio should prosper—drawing a much better valuation than the company does now.  Consider that WBD’s stock price has been bobbing around the $10 level for the past 17 months, giving the company an enterprise value now of just $61 billion. That’s roughly one-seventh the value Netflix enjoys, even though the two companies had the same revenue last year. Netflix deserves a good premium, no question. Apart from anything else, it’s much more profitable: Netflix generated free cash flow of $6.9 billion last year compared with WBD’s $4.4 billion. But the valuation difference is mostly owing to the fact that half of WBD is steadily shrinking.  https://www.forbes.com/sites/joecornell/2024/11/26/comcast-plans-to-spin-off-its-cable-networks-and-digital-assets/

Comcast Corp is planning to spin off a large part of its NBCUniversal’s cable TV channels into a separate publicly traded
company (SpinCo).

Comcast Plans To Spin Off Its Cable Networks And Digital Assets

Tasia

Warner Bros. Discovery has appointed SoFi CEO Anthony Noto and IAC CEO Joey Levin to its board of directors, bringing the total to 13 members.

Disney, Warner Bros. Discovery, and Fox scrapped plans to create a joint sports-streaming service days after Disney said it would acquire sports streamer FuboTV.

https://sherwood.news/business/disney-fox-warner-bros-discovery-stop-joint-sports-streaming-plans/?utm_source=snacks&utm_medium=email&utm_campaign=snacks_20250113&utm_content=060b7b1d0a7c0ff6b85503d98153ebca

Disney, Warner Bros. Discovery, and Fox scrapped plans to create a joint sports-streaming service days after Disney said it would acquire sports streamer FuboTV.  https://sherwood.news/business/disney-fox-warner-bros-discovery-stop-joint-sports-streaming-plans/?utm_source=snacks&utm_medium=email&utm_campaign=snacks_20250113&utm_content=060b7b1d0a7c0ff6b85503d98153ebca

The deal, announced last February, would’ve brought channels like ESPN, ABC, Fox, TNT, and TBS all under a new service called Venu Sports....

Disney, Fox, and Warner Bros. Discovery pull the plug on joint sports-streaming service

Jerome Cody

Lately, many media companies have been looking a lot like corporate versions of retirement home residents in the final innings of their lives. But in recent weeks, a few have taken steps that suggest they’re looking for a way to extend their life expectancy. 

The latest is Warner Bros. Discovery, which on Thursday said it would put its slowly declining TV network operations in one corporate segment separate from its streaming and film businesses. The announcement was a not-so-subtle way of hinting that it was preparing for a possible breakup of the company. Having two distinct corporate segments could make it easier for WBD to spin off its profitable but shrinking TV networks as a new company distinct from its growing but not so profitable streaming and film operations.

If WBD ends up going down that path, it would be following the path of Comcast, which a few weeks ago announced a similar plan for its NBCUniversal entertainment arm. WBD stock jumped 15% in response to the news.

https://corporate.comcast.com/press/releases/spin-off-select-cable-television-networks?utm_campaign=article_email&utm_content=article-14156&utm_medium=email&utm_source=sg#:~:text=Comcast%20Corporation%20(NASDAQ%3A%20CMCSA),assets%20including%20Fandango%20and%20Rotten

Lately, many media companies have been looking a lot like corporate versions of retirement home residents in the final innings of their lives. But in recent weeks, a few have taken steps that suggest they’re looking for a way to extend their life expectancy.   The latest is Warner Bros. Discovery, which on Thursday said it would put its slowly declining TV network operations in one corporate segment separate from its streaming and film businesses. The announcement was a not-so-subtle way of hinting that it was preparing for a possible breakup of the company. Having two distinct corporate segments could make it easier for WBD to spin off its profitable but shrinking TV networks as a new company distinct from its growing but not so profitable streaming and film operations.  If WBD ends up going down that path, it would be following the path of Comcast, which a few weeks ago announced a similar plan for its NBCUniversal entertainment arm. WBD stock jumped 15% in response to the news.  https://corporate.comcast.com/press/releases/spin-off-select-cable-television-networks?utm_campaign=article_email&utm_content=article-14156&utm_medium=email&utm_source=sg#:~:text=Comcast%20Corporation%20(NASDAQ%3A%20CMCSA),assets%20including%20Fandango%20and%20Rotten

Nate

A group of likeminded people in The Most Important Thing are talking about this.