WBD Reports Lower Revenue, Aggressive Cost Cuts Boost Free Cash Flow; Streaming Gains Subscribers, Advertising Revenue Beats Estimates

Warner Bros. Discovery (WBD) reported lower-than-expected revenue and an adjusted loss per share in the first quarter, with free cash flow jumping due to aggressive cost cutting. The company’s linear TV business continued to decline, and network advertising revenue dropped by 11%. Streaming advertising revenue, however, increased significantly and the direct-to-consumer (DTC) streaming business remained profitable. The company revealed that it added 2 million Max subscribers in the quarter, ahead of expectations, and streaming advertising revenue beat estimates. WBD CEO David Zaslav did not comment on ongoing negotiations regarding NBA media rights. Reports suggest that the company may aim for more cost cuts and price hikes, potentially including layoffs following the recent slashing of 2,000 jobs. WBD shares fell by around 3% in response to the results.