Warner Bros. Discovery (WBD) Q4 2024 earnings

Warner Bros. Discovery said Thursday it added 6.4 million global streaming subscribers in the fourth quarter for a total of 116.9 million subscribers.

Fourth-quarter revenue for the streaming segment, which is anchored by flagship service Max, totaled $2.65 billion, up 5% from $2.53 billion in the same quarter last year. Adjusted earnings before interest, taxes, depreciation and amortization for the unit came in at $409 million, compared with an adjusted EBITDA loss of $55 million in the fourth quarter of 2023.

In a shareholder letter, the media and entertainment company forecast adjusted EBITDA of $1.3 billion for its streaming business for the year — roughly double the $677 million adjusted EBITDA it reported for 2024 — and said it has a “clear path” to hit 150 million global subscribers by the end of 2026. Max is set to launch on television service Sky in the United Kingdom and Ireland by the second quarter of 2026, and will debut in Germany and Italy in the first quarter of that year.

“In this generational media disruption, only the global streamers will survive and prosper, and Max is just that,” CEO David Zaslav said on the company’s earnings call Thursday.

WBD announced Wednesday that Max would keep its B/R Sports and CNN content available at no additional cost to subscribers in its standard and premium tiers. Initially WBD planned to charge an additional cost for sports.

However, it will pull both verticals from its basic, ad-supported tier beginning March 30.

On the earnings call, JB Perrette, CEO and president of global streaming and games, said the company would continue to experiment with its news and sports business models.

While sports have increased their presence on streaming services recently, with platforms like Netflix adding to their live sports portfolios, Zaslav said the company is more focused on maximizing its returns than acquiring more sports content.

Warner Bros. Discovery is losing U.S. distribution rights to National Basketball Association games starting next season. It still has a U.S. sports portfolio that includes the French Open, Major League Baseball, college football and the National Hockey League.

“We don’t need any more sports anywhere in the world in order to support our business,” Zaslav said, adding that he expects it will become more difficult to obtain sports rights with increasing prices and competition.

On the news front, Zaslav said Warner Bros. Discovery expected CNN to see more benefit from the 2024 presidential election that ultimately did not materialize. CNN, along with MSNBC, saw its ratings fall drastically after the election, while Fox News enjoyed strong ratings in that period.

Shares of WBD rose nearly 5% Thursday.

Here’s how Warner Bros. Discovery performed in the fourth quarter of 2024 compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

• Loss per share: 20 cents vs. earnings per share of 1 cent expected
• Revenue: $10.03 billion vs. $10.19 billion expected

WBD’s overall fourth-quarter revenue fell 2% to $10.03 billion from $10.28 billion during the same quarter in 2023. Full-year 2024 revenue came in at $39.32 billion, down 5% from $41.32 billion in 2023.

Warner Bros. Discovery reported a net loss of $494 million for the fourth quarter of 2024, or a loss of 20 cents per share, compared with a net loss of $400 million, or a loss of 16 cents per share, during the fourth quarter of 2023.

TV networks revenue came in at $4.77 billion, compared with $5.04 billion in the year-earlier period. The company previously wrote down $9.1 billion for its networks business in its 2024 second-quarter earnings report. In its shareholder letter, Warner Bros. Discovery noted that it expects further declines in cable subscribers and that the advertising market for U.S. linear television is shrinking faster than expected.

For the studios business, fourth-quarter revenue totaled $3.66 billion, an increase of 15% from $3.17 billion in the fourth quarter of 2023.

“We are laser-focused on getting our studios back to a place of industry leadership,” Zaslav said.

Disclosure: MSNBC and CNBC are divisions of NBCUniversal.