Warner Strikes New All-Cash Deal With Netflix

The media company also released financial details on its soon-to-be spun-off cable networks

By Joe Flint

Updated Jan. 20, 2026 7:56 am ET

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Netflix offices in Los Angeles Mario Tama/Getty Images

Quick Summary

• Warner Bros. Discovery and Netflix struck a new all-cash deal worth $72 billion. View more

Warner Bros. Discovery WBD -1.19%decrease; red down pointing triangle and Netflix NFLX -0.84%decrease; red down pointing triangle said Tuesday that they struck a new all-cash deal for Netflix to buy Warner’s studios and HBO Max streaming business. Warner also released financial details on the cable-networks business it plans to spin off.

The all-cash deal of $27.75 per share replaces Netflix’s previous cash-and-stock deal. The sweetened offer comes as rival bidder Paramount continues pushing its own all-cash offer for all of Warner Discovery. The value of Netflix’s offer remains $72 billion.

Warner and Netflix said they expect the new structure to enable Warner shareholders to vote on the deal by April. The change could also help sway some shareholders who might be weighing its bid against Paramount’s.

Netflix co-CEO Greg Peters said in a statement the revised agreement “demonstrates our commitment to the transaction” and accelerates the process for Warner shareholders.

The new Netflix agreement reduces by $260 million the amount of Warner debt being placed on Discovery Global, the company that will house cable channels including CNN, TNT and Food Network. Warner said the reduction was because of the better-than-expected cash-flow performance of the business last year.

Warner made the disclosures in a preliminary proxy statement that the Securities and Exchange Commission will now review.

Paramount has continued to push its $77.9 billion hostile offer for all of Warner, including its cable networks. Earlier this month, Paramount said it plans to launch a proxy fight for Warner board seats.

Part of Warner’s reasoning for favoring Netflix’s deal has been the fact that its stockholders would retain shares in the portion of the company that the streamer doesn’t buy, giving them access to potential upside. Paramount, on the other hand, has said it believes that part of the business isn’t worth anything. 

In its Tuesday filing, Warner projected $17 billion in revenue in 2026 and adjusted earnings before interest, taxes, depreciation and amortization of $5.4 billion. Those figures are expected to decline to $15.6 billion and $3.8 billion, respectively, in 2030.

The only individual network projections were for CNN, which Warner said is forecast to generate $1.8 billion in revenue this year, increasing to $2.2 billion in 2030. Adjusted Ebitda for CNN is expected to be about $600 million in 2030, roughly flat with this year. 

Paramount last week filed a lawsuit seeking to force Warner to immediately release more information about its Netflix deal, but a judge denied the motion to expedite the proceeding. Paramount didn’t prove it would suffer irreparable harm from any alleged omissions of information by Warner, the judge ruled. 

The new Netflix deal structure does away with a so-called collar, a mechanism meant to protect shareholders from large swings in an acquirer’s share price between the time when a deal is announced and when it closes.

If Netflix shares dipped below $97.91, Warner shareholders were to get a larger portion of Netflix shares as part of the deal. If they rose above $119.67, shareholders would have received a smaller portion. 

Netflix shares have been trading below that collar since Netflix and Warner unveiled their deal in December. Shares fell further after Paramount made its hostile tender offer days later, with investors fearing that Netflix would be forced to pay more money to compete with the Paramount offer.

Netflix stock has dropped about 15% since its deal with Warner was announced. Netflix shares rose on the recent news that it was considering making its deal all-cash.

Write to Joe Flint at Joe.Flint@wsj.com

Corrections & Amplifications
Paramount has continued to push its $77.9 billion hostile offer for all of Warner, including its cable networks. An earlier version of this article incorrectly said that the offer was for Paramount. (Corrected on Jan. 20)

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