Netflix to Acquire Warner Bros. Film and Streaming Businesses in Landmark $72 Billion Deal

Streaming giant Netflix has reportedly struck a monumental deal with Warner Bros. Discovery to acquire its extensive film and streaming operations for an equity value of $72 billion, with a total enterprise value reaching approximately $82.7 billion, according to reports from CBS News on Friday. This acquisition is poised to dramatically reshape the global entertainment industry landscape.

The agreement, announced on Friday, December 5, 2025, will see Netflix gain control of Warner Bros. studio, HBO, HBO Max, and DC Studios, along with their vast film and television libraries. This move consolidates a significant portion of Hollywood's production and distribution under Netflix, creating an unparalleled content powerhouse.

The complex transaction is contingent upon Warner Bros. Discovery first spinning off its linear cable networks, including CNN, TBS, and TNT, into a separate publicly traded entity called Discovery Global. This separation is anticipated to be completed by the third quarter of 2026, with the full acquisition expected to close within 12 to 18 months.

Netflix's co-CEO, Ted Sarandos, stated that the combination of Netflix and Warner Bros. will create "a better Netflix for the long run," emphasizing the need to evolve in a world of abundant consumer choices, as reported by The Guardian. This strategic move aims to enhance Netflix's studio capabilities and expand its U.S. production capacity.

For Warner Bros. Discovery, the deal addresses its substantial debt burden, which stood at over $33 billion, and aims to improve its financial health. CEO David Zaslav expressed that uniting with Netflix will ensure audiences continue to enjoy Warner Bros.' resonant stories for generations to come, according to pbs News.

The acquisition, which saw Netflix outbid rivals like Paramount Skydance and Comcast, is expected to face intense regulatory scrutiny due to its potential impact on market competition, forbes reported. Netflix has committed to a $5.8 billion breakup fee if the deal fails to secure regulatory clearance, as noted by The Guardian.

Despite the significant financial undertaking, including a $59 billion unsecured bridge loan, Netflix anticipates realizing $2-3 billion in annual cost savings by the third year post-acquisition. The company also pledged to maintain theatrical releases for Warner Bros. films, a key concession aimed at easing industry concerns, according to ainvest.

• Background and Industry Consolidation: The streaming industry has been undergoing a significant shift from rapid expansion to strategic consolidation, as highlighted by TechFinitive. The merger of WarnerMedia and Discovery Inc. to form Warner Bros. Discovery in 2022 was a notable example, aiming to create a diversified content powerhouse. This latest acquisition by Netflix signifies a new phase in the "streaming wars," moving towards fewer, larger players.

• Key Stakeholders and Motivations: Netflix, led by Ted Sarandos, seeks to solidify its market dominance by acquiring a vast library of iconic intellectual property, including franchises like Harry Potter, Game of Thrones, and the DC Universe. Warner Bros. Discovery, under CEO David Zaslav, aims to deleverage its balance sheet and secure the future of its studio and streaming assets amidst a challenging financial landscape. Shareholders of WBD will receive a mix of cash and Netflix stock, allowing them to participate in the combined entity's future upside, forbes reported.

• Economic and Financial Implications: The $82.7 billion enterprise value deal represents a massive financial commitment for Netflix, which will utilize a substantial $59 billion unsecured bridge loan, as detailed by AInvest. This level of debt introduces significant financial pressure and potential shareholder dilution for Netflix, as noted by Seeking Alpha. However, Netflix projects annual cost savings of $2-3 billion by the third year, aiming for the acquisition to be accretive to GAAP earnings per share by year two.

• Regulatory and Legal Context: The proposed merger is expected to face rigorous antitrust scrutiny from regulators concerned about market concentration, according to forbes. Combining the world's largest streaming platform with one of Hollywood's most influential studios could raise significant competition concerns, potentially leading to delays or conditions for approval. Netflix's offer includes a substantial breakup fee if regulatory hurdles prove insurmountable.

• Impact on Content and Consumers: The acquisition will bring HBO Max's premium content, including HBO and HBO Max originals, under the Netflix umbrella, offering subscribers an even wider selection of high-quality titles. Netflix has also committed to continuing theatrical releases for Warner Bros. films, which could impact traditional distribution windows and consumer access to new movies. This consolidation could lead to a more streamlined, but potentially less diverse, streaming landscape for consumers.

• Competitive Landscape and Future Developments: This mega-merger will undoubtedly intensify competition for other major streaming players like Disney+, Amazon Prime Video, and Apple TV+. Analysts suggest that the deal could prompt further consolidation within the industry as rivals seek to strengthen their own content libraries and market positions. The long-term impact on content creation, talent deals, and subscription models across the industry remains a key area of speculation.