Warner Bros. Discovery Reports Full-Year Streaming Profit

Though Warner Bros. Discovery missed analyst targets for both profit and revenue in the fourth quarter it did have a silver lining with the company becoming the first Hollywood conglomerate to turn a profit for its streaming unit for a full year according to the Hollywood Reporter.

The company’s subscription streaming service, Max, ended 2023 profitable, with full-year adjusted EBITDA of $103 million. Its global streaming subscriber base, which was 95.1 million for the third quarter rose to 97.7 million streaming subscribers in the Q4.

Global DTC subscribers were 97.7 million at the end of Q4, which included 1.3 million subscribers from the acquisition of BluTV. Global DTC ARPU was $7.94, a 7% ex-FX increase vs. the prior year quarter, WBD said.


 

Max’s advertising tier, which is currently only available in the U.S., will be available in 40 international markets by the end of 2024 the company said during a conference call.

“We have an attack plan for 2024 that includes the roll-out of Max in key international markets, a more robust creative pipeline across our film and TV studios, and further progress against our long-range financial goals and are confident in our ability to drive sustained operating momentum and enhanced shareholder value,” said WBD CEO David Zaslav.

Q4 Financial Summary & Operational Highlights:

  • Q4 total revenues were $10,284 million. Revenues decreased 7% ex-FX compared to the prior year quarter.
  • Net loss available to Warner Bros. Discovery, Inc. was $(400) million, including $1,699 million of pre-tax amortization driven by acquisition-related intangibles and $75 million of pre-tax restructuring expenses.
  • Q4 total Adjusted EBITDA was $2,471 million. Adjusted EBITDA decreased 5% ex-FX compared to the prior year quarter.
  • Cash provided by operating activities increased to $3,578 million. Reported free cash flow increased to $3,310 million.
  • Repaid $1.2 billion of debt during Q4. Ended the quarter with $4.3 billion of cash on hand, $44.2 billion of gross debt, and 3.9x net leverage.
  • Global DTC subscribers were 97.7 million at the end of Q4, which included 1.3 million subscribers from our acquisition of BluTV. Global DTC ARPU was $7.94, a 7% ex-FX increase vs. the prior year quarter.
  • TNT Sports continued to strengthen its global sports portfolio with a four-year extension of its U.K. Premier League rights, as well as signing a seven-year agreement with NASCAR, in the U.S., beginning in 2025.
  • In Q4, Adult Swim had the largest year-over-year primetime delivery growth in cable among P18-49 and P25-54, led by Rick and Morty as cable’s #1 comedy.


 

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