Yahoo Finance·2026-01-08 21:33Core Viewpoint - Netflix's stock has experienced a significant decline, dropping 12.9% in December 2025 and trading 30% below its all-time high from June 2025, primarily due to the ongoing buyout situation involving Warner Bros. Discovery [2][5]. Group 1: Buyout Bid Details - On December 5, 2025, Netflix proposed a negotiated buyout bid involving an $82.7 billion cash-and-stock deal for Warner Bros.' movie studio and streaming service assets, contingent on Warner Bros. separating from its Discovery-branded cable TV stations [3]. - The Netflix offer received unanimous support from Warner Bros. Discovery's board, which also rejected a competing bid from Paramount Skydance valued at $108.4 billion [4]. Group 2: Investor Sentiment and Market Reaction - Investors are apprehensive about three potential outcomes: a successful deal with Netflix, a hostile takeover by Paramount Skydance, or failure in regulatory approval, contributing to the decline in Netflix's stock price [5]. - The stock's current trading price of $91.18 per share reflects a significant drop from its June 2025 high, potentially presenting a buying opportunity for long-term investors [5]. Group 3: Financial Implications - The proposed deal would add $50 billion in new debt to Netflix's balance sheet, including $10.7 billion of Warner Bros. Discovery's debt and $11.7 billion in stock dilution, in exchange for acquiring a valuable content library [6]. - If the deal fails due to regulatory issues, Netflix would incur a $5.8 billion breakup fee to Warner Bros. Discovery, impacting the media industry's landscape [6].