Warner Bros. Discovery Sees Streaming Subs Rocket To 110 Million As International Rollout Gathers Pace, But Q3 Revenues Dip With Box Office Down

Core Insights - Warner Bros Discovery (WBD) added over 7 million net subscribers in Q3 2024, driven by the international rollout of Max, despite a decline in total revenues and earnings compared to 2023 [1][2] Financial Performance - Total revenues for WBD were $9.62 billion, reflecting a 3$2.41 billion [3] - Net income was reported at $135 million, significantly impacted by a$1.6 billion pre-tax cost related to acquisition-related amortization and restructuring expenses [3] - Studio revenues decreased by 17% to $2.68 billion, with adjusted EBITDA down 58$308 million, attributed to the absence of major hits like "Barbie" [4] Subscriber Growth - The global direct-to-consumer (DTC) subscriber count reached 110.5 million by the end of the quarter, with the 7.2 million increase marking the largest quarterly growth since Max's launch [2] Market Challenges - The theatrical revenue saw a 40% decline, influenced by lower box office performances of films like "Bettlejuice Bettlejuice" and "Twisters" compared to "Barbie" [4] - Upcoming challenges include the release of "Joker: Folie à Deux," which is anticipated to be a significant box office disappointment, and the loss of NBA broadcasting rights in 2025, raising concerns about future carriage fees for TNT and other networks [5] Strategic Developments - WBD is involved in a joint venture, Venu Sports, with Disney and Fox, although its planned launch was halted due to legal issues related to antitrust violations [6] - Despite the challenges, WBD secured an early distribution renewal with Charter Communications, the leading U.S. pay-TV operator [5] Stock Performance - WBD shares have been trading between $7 and$8 since spring, reflecting investor concerns over the company's reliance on linear TV amid ongoing cord-cutting trends [7]