Warner Bros. Discovery Inc (NASDAQ:WBD) reported a significant second-quarter loss on Wednesday, attributed to a hefty $9.1 billion charge in its networks unit following the loss of NBA media rights.
Shares of Warner Bros. Discovery dropped more than 9% intra-day today. The entertainment conglomerate reported a loss of $4.07 per share on revenue of $9.71 billion, missing Street expectations of a $0.19 loss per share on revenue of $10.07 billion.
The widened loss stemmed from a $9.1 billion hit in its networks segment, exacerbated by a sluggish U.S. linear advertising market and uncertainties related to affiliate and sports rights renewals, including the NBA. Content revenue saw a 6% decline, with a notable 27% drop in EV TV revenue, driven by lower licensing sales.
Global direct-to-consumer (DTC) subscribers reached 103.3 million by the end of Q2, marking an increase of 3.6 million from Q1. The average global DTC revenue per user was $8.00, reflecting a 4% sequential increase in constant currency.
Despite these challenges, the company remains committed to exploring new bundling opportunities to expand the reach of its streaming service, Max. Warner Bros. Discovery emphasized that these initiatives and other strategic actions are expected to drive segment profitability in the latter half of the year and into 2025 and beyond.