Netflix to Buy Warner Bros. for $72 Billion

Warner Bros. is to split its studios and HBO Max streaming business from its cable networks. Paramount and Comcast also made offers.

By Joe Flint and Lauren Thomas

Updated Dec. 5, 2025 at 11:25 am ET

Netflix NFLX -3.38%decrease; red down pointing triangle has agreed to buy Warner Bros. for $72 billion after the entertainment company splits its studios and HBO Max streaming business from its cable networks, a deal that would reshape the entertainment and media industry.

The cash-and-stock transaction was announced Friday after the two sides entered into exclusive negotiations for the media company known for Superman and the Harry Potter movies, as well as hit TV shows such as “Friends.”

The offer is valued at $27.75 per Warner Discovery share and has an enterprise value of roughly $82.7 billion. Rival Paramount, which sought to buy the entire company, including Warner’s cable networks, bid $30 per share all-cash for Warner Discovery, according to people familiar with the matter. Paramount is weighing its next move, people familiar with its plans said.

Paramount had argued that a deal with Netflix wouldn’t be blessed by antitrust regulators given it would further cement the streamer’s global dominance. President Trump’s advisers, including White House officials, are concerned about the deal, a senior administration official said Friday.

Netflix’s Sarandos said the company is “highly confident” about approval because it is “pro-consumer” and “pro-innovation.”

Netflix’s deal with Warner would combine the largest global streaming service with its smaller rival as entertainment companies seek ways to add new subscribers and boost revenue with price increases. It gives more heft to Netflix, which has ascended from a DVD-by-mail rental business into a powerful force in Hollywood.

Netflix shares were little changed Friday morning while Warner shares were up more than 3%. Paramount shares were down 7%, suggesting its shareholders had expected the company to land the deal, which would have helped it compete with larger rivals.

Ted Sarandos, co-chief executive of Netflix, said on an investor call that while over the years Netflix had typically been “builders, not buyers,” the opportunity to purchase Warner was a “rare opportunity” that sets it up for years to come. “We can’t stand still,” he said.

Netflix, the streaming giant home to “KPop Demon Hunters,” “Love Is Blind” and “Stranger Things,” said the deal would help it attract and retain more subscribers, giving it Warner’s vast TV and movie libraries as well as HBO and HBO Max shows. It expects the deal to “significantly expand U.S. production capacity.”

HBO and its streaming service HBO Max will continue to operate as a stand-alone, Sarandos said.

Netflix co-CEO Greg Peters said the HBO brand is powerful to consumers. “That gives us a lot of options to figure out how you package things in different ways,” he said.

The company, which typically releases films directly to its streaming service, said it expects to continue Warner’s business of releasing movies in theaters.

The deal, Netflix’s largest ever, is one of the biggest transactions announced so far this year, as mergers and acquisitions activity has picked back up under the Trump administration.

Warner Discovery CEO David Zaslav said the combination “will ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come.”

Warner Discovery is continuing with plans to split itself into two separate companies, one comprising the studio and streaming assets and the other containing its global cable network operations, before closing a potential deal with Netflix.

Paramount had sought to buy the entire company, including cable networks such as CNN, TNT and TBS.

Though Paramount offered Warner a higher price per share than Netflix did, Warner saw Netflix’s deal as the superior one given that Warner shareholders would continue to own shares in both companies following its planned split, people familiar with the matter said. By that measure, Warner concluded Netflix’s deal values the company at around $31 to $32 a share, versus Paramount’s $30, the people said.

Warner Discovery and Netflix said they expect the deal to close in 12 to 18 months.

A Netflix acquisition of Warner Discovery streaming and studio assets raises questions about how the streaming giant’s business model might change in the future, including how it releases films, analysts have said.

Michael O’Leary, CEO of theatrical exhibition trade body Cinema United, said before the deal was announced that such a transaction “poses an unprecedented threat to the global exhibition business.”

Warner’s TV studio sells shows to several networks and streaming services, including rivals of both HBO Max and Netflix. Netflix has historically kept its shows in-house.

The deal is a blow to Paramount CEO David Ellison’s ambitions of bringing together two famed entertainment brands. Ellison took control of Paramount earlier this year.

Paramount wrote in a Wednesday letter to Zaslav that the company had “embarked on a myopic process with a predetermined outcome that favors a single bidder.”

In a letter to Warner Discovery’s lawyers, Paramount earlier criticized Netflix’s bid, saying a sale to the streamer would likely “never close” because of potential regulatory challenges here and abroad, given its global dominance.

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