Netflix has decided to pay for Warner Bros. Discovery’s streaming and studio division using cash, outbidding Paramount in a move that could reshape the entertainment industry globally. The $72-billion US equity deal, valued at $27.75 US per share, was announced by Netflix on the same day as its fourth quarter earnings, aiming to accelerate the process leading to a shareholder vote and ensuring the delivery of value at closing.
The battle between Netflix and Paramount has been ongoing for months, with Netflix targeting Warner Bros.’ studio business and streaming content while Paramount sought to acquire the entire company, including assets like CNN and Discovery+ streaming channel. Geetha Ranganathan, a senior media analyst at Bloomberg Intelligence, questioned whether the acquisition was a necessity or a luxury for Netflix.
While the deal is crucial for Paramount Skydance under new CEO David Ellison, it is perceived as less critical for Netflix, which has faced a slowdown in subscriber growth. Netflix is now focusing on enhancing engagement to drive its value. Ranganathan highlighted that Warner Bros.’ extensive content library, featuring popular franchises like “Harry Potter,” iconic TV shows such as “Friends” and “Game of Thrones,” and classic films like “Citizen Kane” and “Casablanca,” could significantly enhance Netflix’s business expansion.
After months of speculation, Netflix made a bid for Warner Bros. following the announcement of Warner Bros. Discovery’s plan to split into two companies. Paramount’s initial bid was rejected, leading to Netflix’s increased interest. In the subsequent months, Paramount raised its proposed breakup fee to $5 billion as part of a hostile bid against Warner Bros. Discovery.
In January 2026, Warner Bros. Discovery rejected Paramount’s hostile bid, emphasizing the risks associated with the offer. The company urged shareholders to support the Netflix deal, emphasizing the strategic benefits of the partnership. Analysts believe that the upcoming shareholder vote on the deal will be crucial, potentially determining the future direction of the acquisition. The situation remains fluid, with uncertainties surrounding regulatory approvals and potential antitrust implications for Netflix’s film studio and HBO assets.