Netflix updates Warner Bros bid to all-cash offer, posts Q4 2025 results
Revenue at Netflix climbed almost 18% in the fourth quarter of 2025 to just over US$12bn, with the global streamer claiming over 325 million paying members as it updates its Warner Bros and HBO Max bid to an all-cash offer.
Netflix reported its fourth-quarter earnings yesterday, which came slightly above analyst expectations.
Despite the positive results, shares in Netflix were down around 5% in after-hours trading, with investors cool on its forward-looking guidance on revenue as its move for Warner Bros Discovery’s (WBD) studio and streaming assets hangs in the balance.
The global streamer said its ambitions for 2026 include increasing the variety and quality of series and films on its service, pushing further into live events and video podcasts and working to close its acquisition of Warner Bros and HBO Max.
It’s been a hectic three months for the streamer, after its third-quarter earnings call in October last year saw co-CEOs Greg Peters and Ted Sarandos play down rumours tying it to a potential bid to acquire WBD’s studio and streaming assets.
However, since then, things have moved quickly and the streamer yesterday updated its surprise bid for the rival entertainment giant to an all-cash offer.
This came after a week of speculation Netflix would make the switch, with Paramount Skydance escalating its attempts to derail its existing definitive agreement.
The amended deal will see the streaming giant putting forth an amended all-cash bid, though this does increase the total value of the offer, worth US$27.75 per share.
Under the previous pact, WBD shareholders were set to receive US$23.25 in cash and US$4.50 in Netflix common stock.
The all-cash transaction continues to be valued at US$27.75 per WBD share, while WBD stockholders will also receive the additional value of shares of Discovery Global following its separation from WBD. Netflix said the transaction will be financed through a combination of cash on hand, available credit facilities and committed financing.
WBD is set to split Warner Bros and Discovery Global into two separate publicly traded companies. This separation is expected to be completed in six to nine months, prior to the closing of the proposed Netflix and Warner Bros transaction.
The amended, all-cash transaction was unanimously approved by the boards of directors of both Netflix and WBD.
Closing remains subject to completion of the Discovery Global separation, receipt of required regulatory approvals, approval of WBD stockholders and other customary closing conditions. The financing structure is not subject to review by the Committee on Foreign Investment in the United States.
It comes after David Ellison’s Paramount Skydance proposed an all-cash offer to acquire all of WBD for US$30 per share and filed a lawsuit against WBD as it seeks to force WBD’s board to engage with its $30-per-share offer.
For its part, WBD has repeatedly said that Paramount’s offer is not better than Netflix’s. It has also gone several steps further, stating that it sees red flags in Paramount’s financing plan. It has also pointed to Paramount’s “junk” credit rating, versus Netflix’s “investment-grade balance sheet” and US$400bn market cap as rationale for its decision.
Earlier this month Netflix said that it is already “engaging” with the US Department of Justice and the European Commission as it begins regulatory processes that could take between 12 and 18 months.
US president Donald Trump has also said he will be “involved” in whether the deal gets approved in the US. Trump praised Sarandos in December while also saying the deal “could be a problem” due to the combined market share of Netflix and Warner Bros.
Most recently, Trump reposted a story from conservative news outlet One America News titled ‘Stop the Netflix Cultural Takeover’ on his social media platform Truth Social.
David Zaslav, president and CEO of WBD, said: “Today’s revised merger agreement brings us even closer to combining two of the greatest storytelling companies in the world and with it even more people enjoying the entertainment they love to watch the most.
“By coming together with Netflix, we will combine the stories Warner Bros. has told that have captured the world’s attention for more than a century and ensure audiences continue to enjoy them for generations to come.”
Sarandos, co-CEO of Netflix, added: “The WBD Board continues to support and unanimously recommend our transaction, and we are confident that it will deliver the best outcome for stockholders, consumers, creators and the broader entertainment community.
“Our revised all-cash agreement will enable an expedited timeline to a stockholder vote and provide greater financial certainty at $27.75 per share in cash, plus the value from the planned separation of Discovery Global.
“Together, Netflix and Warner Bros. will deliver broader choice and greater value to audiences worldwide, enhancing access to world-class television and film both at home and in theaters. The acquisition will also significantly expand US production capacity and investment in original programming, driving job creation and long-term industry growth.”
Peters, co-CEO of Netflix, said: “Over the last decade, when much of the entertainment industry has contracted, Netflix has grown and invested tremendously in the business of film and television in the U.S. and abroad. This transaction will further fuel that growth and investment.
“By amending our agreement today, we are underscoring what we have believed all along: not only does our transaction provide superior stockholder value, it is also fundamentally pro-consumer, pro-innovation, pro-creator and pro-growth.
“Our revised all-cash agreement demonstrates our commitment to the transaction with Warner Bros. and provides WBD stockholders with an accelerated process and the financial certainty of cash consideration, while maintaining our commitment to a healthy balance sheet and our solid investment grade ratings. We will continue to work closely with WBD to successfully complete the transaction as we remain focused on our mission to entertain the world and, together, define the next century of storytelling.”
Samuel A Di Piazza Jr, chair of the WBD board of directors, said: “Our amended agreement with Netflix is a testament to the Board’s unrelenting focus on representing and advancing our stockholders’ interests.
“By transitioning to all-cash consideration, we can now deliver the incredible value of our combination with Netflix at even greater levels of certainty, while providing our stockholders the opportunity to participate in management’s strategic plans to realize the value of Discovery Global’s iconic brands and global reach. We look forward to continuing to engage with our investors about the compelling benefits of the transaction as we progress toward our stockholder vote on an accelerated timeline.”
