Prime Highlights:
- Warner Bros. Discovery will be split into two separate companies: one will be for streaming and studios, and the other for linear networks.
- The CEO of the company, David Zaslav, will be leading the streaming business, while the CFO, Gunnar Wiedenfels, will be running the networks business.
Key Facts:
- The company presently has approximately $37 billion in debt, which the restructuring seeks to manage.
- The streaming division will comprise HBO, Warner Bros. Film & TV, and DC Studios.
- The bifurcation would be completed by mid-2026 so that both the arms can function independently.
Key Background
The 2022 merger that created Warner Bros. Discovery put together AT&T’s WarnerMedia, featuring HBO and Warner Bros., with Discovery, whose cable channels include Discovery and TLC. The dream was to create a single content giant that could compete with the likes of Netflix and Amazon. The integration, though, was bumpy.
The firm was saddled with a $40 billion debt burden from the very beginning. CEO David Zaslav adopted belt-tightening policies such as scrapping big-budget projects such as Batgirl, cutting down on scripted content production, and laying off employees in multiple departments. The moves riled up both company insiders and fans, who criticized WBD for compromising creative value in pursuit of cost reduction.
In the meantime, WBD struggled to find purchase in the streaming wars. As rivals amassed hundreds of millions of worldwide subscribers, Max trailed, with 122 million subscribers in early 2025. Analysts wrote that the company was not doing a good job of delivering a unified brand voice or content strategy, notwithstanding its trove of intellectual property.
By late 2024, evidence of more profound organizational changes was beginning to surface. WBD quietly started dividing its internal divisions into content creation and distribution wings. That set the stage for the announced June 2025 decision to split into two separate companies.
This move also comes against the backdrop of wider trends in the media sector. Established cable TV is continuing to lose customers year on year, with American homes unplugging en masse. Media conglomerates are facing mounting pressure to sell or restructure to keep up with the digital-first reality.
For Zaslav, the move perhaps also has to do with defending his own legacy. His post-merger period leadership has been in the dock on account of WBD’s declining stock price, unpopular moves, and mutiny. The restructuring lets him concentrate on the streaming business, where he might attempt to craft a more nimble, future-facing media company.
In the meantime, the Global Networks business has a rough road to travel. Although still profitable, it is embedded in a shrinking business. The strategy might ultimately be to exit or sell out that business, enabling WBD to redirect its entire momentum into the digital future.
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