Netflix Acquires Warner Bros. Studios and Streaming Assets for $72 Billion

Netflix emerges victorious in a fierce bidding war, securing Warner Bros. Discovery’s film studios and streaming division in a transformative $72 billion deal. The acquisition fuses the world’s leading paid streaming service with one of Hollywood’s most storied production houses, reshaping content distribution and theatrical release strategies. Paramount mounts a fierce antitrust challenge, warning regulators of Netflix’s potential to stifle competition in the SVOD market. This merger signals a seismic shift toward consolidated digital dominance, leaving traditional cinema and cable networks in precarious flux.

The agreement values Warner Bros. Discovery’s targeted assets at $72 billion in equity, with an enterprise value reaching $82.7 billion when factoring in assumed debts. Shareholders receive $27.75 per share through a mix of cash and Netflix stock, pending Warner Bros.’ planned separation of its streaming and studios unit from global networks like CNN and TNT in mid-2026. Netflix outmaneuvered rivals Comcast and a Paramount-Skydance consortium, sources close to the negotiations confirm, after Warner Bros. initiated a strategic review in October 2025 amid $9.2 billion in streaming losses over three years. The deal encompasses Warner Bros. Motion Picture Group, New Line Cinema, Warner Bros. Television, and HBO Max’s 95 million global subscribers.

Paramount Global, through a December 1 letter from law firms Latham & Watkins and Cravath, assails the transaction as a threat to market vitality. The missive argues that Netflix commands 43 percent of worldwide SVOD subscribers, rendering the merger presumptively unlawful under U.S. antitrust statutes like the Clayton Act. Paramount contends the combined entity would erode theatrical commitments, leveraging Warner Bros.’ intellectual property—spanning DC Comics, ‘Harry Potter’, and ‘The Lord of the Rings’—to prioritize streaming exclusivity over cinema windows. This approach, critics warn, could slash annual film output from Warner’s 18-20 titles to under 10, exacerbating theater chain consolidations post-2023 strikes.

Regulatory scrutiny looms large, with the U.S. Federal Trade Commission and Department of Justice poised to dissect the pact under Biden-era merger guidelines emphasizing vertical integration risks. European and UK authorities, including the CMA, may impose conditions on content licensing to protect independents, drawing parallels to blocked deals like Adobe-Figma in 2023. Unions like SAG-AFTRA express alarm over reduced bargaining leverage in a streaming-centric landscape, where residuals tied to views rather than box office have yielded 20 percent pay cuts for mid-tier actors since 2020. Netflix counters that the acquisition enhances subscriber choice, projecting $5 billion in annual synergies through shared production pipelines and data-driven greenlights.

Strategically, the infusion bolsters Netflix’s 300 million paid memberships with Warner’s $40 billion content library, including 100,000 hours of HBO originals like ‘Succession’ and ‘The White Lotus’. HBO Max integration promises rebranding under Netflix’s umbrella by Q3 2026, phasing out the standalone app while migrating 80 percent of its catalog. Warner Bros.’ Burbank lot, spanning 110 acres with 30 soundstages, falls under Netflix’s operational control, enabling hybrid shoots that blend virtual production tools like LED walls—used in 60 percent of recent DC films—with traditional backlots. This setup accelerates pipelines for franchises like ‘Dune’, grossing $1.1 billion across two entries.

The merger accelerates Hollywood’s pivot from linear TV, where Warner’s networks generated $11 billion in 2024 ad revenue, now divested to focus on digital. Analysts forecast Netflix’s content spend rising 15 percent to $19 billion in 2027, prioritizing prestige series over mid-budget features that comprised 40 percent of Warner’s slate. Physical media faces obsolescence, with Warner halting new DVD/Blu-ray releases post-closure of its Disc Group in 2024, pushing collectors toward secondary markets amid 25 percent annual declines in U.S. sales. Competitors like Disney, holding 180 million Disney+ users, brace for intensified IP battles, potentially spurring cross-licensing pacts.

Paramount’s bid, valuing Warner at $65 billion with preserved cable assets, positions itself as a “pro-competitive” alternative, promising smoother approvals and sustained theatrical investments. Ellison’s consortium, backed by $8 billion in commitments, vows to maintain 17 annual releases, contrasting Netflix’s history of day-and-date streaming that contributed to 2023’s 15 percent box office dip. As dealmakers navigate a 12-18 month review, stakeholders eye precedents like the approved 2022 Microsoft-Activision merger, which cleared despite monopoly fears. This consolidation underscores streaming’s maturation, where scale dictates survival in a $500 billion global entertainment economy.