Netflix to Acquire Warner Bros. In $83 Billion Deal

Netflix has entered into a definitive agreement to acquire Warner Bros. for approximately $82.7 billion. The purchase, which still needs regulatory approval, is expected to close after Discovery Global, Warner’s Global Networks division, splits off into its own publicly-traded company. That previously-announced separation should be complete by Q3 of 2026. The acquisition deal includes Warner Bros.’ film and television studios, along with HBO and HBO Max. While Netflix is understandably optimistic about this historic move, others in Hollywood have expressed grave concerns. Movie theater operators, industry creatives, and even members of the federal government have wasted no time in challenging Netflix’s rosy outlook on the merger. 

In a press release announcing the deal, Netflix describes a future in which the company’s innovation, global reach, and best-in-class streaming service will be made even better with the addition of “Warner Bros.’ century-long legacy of world-class storytelling.” The amount of intellectual property changing hands in the sale is almost unfathomable. There are, of course, big HBO shows like Game of Thrones, Sex and the City, and The Last of Us. And there are countless network TV titles, from The Big Bang Theory to Buffy the Vampire Slayer. But there are also enormous movie franchises like Harry Potter and The Lord of the Rings, not to mention the entire catalog of DC superheroes, including Superman and Batman. Bugs Bunny and the rest of the Looney Tunes characters are up for grabs. So is The Matrix. Godzilla and King Kong. Scooby-Doo. The list of iconic films and characters goes on seemingly forever.

Our mission has always been to entertain the world. By combining Warner Bros.’ incredible library of shows and movies — from timeless classics like Casablanca and Citizen Kane to modern favorites like Harry Potter and Friends — with our culture-defining titles like Stranger Things, KPop Demon Hunters, and Squid Game, we’ll be able to do that even better. Together, we can give audiences more of what they love and help define the next century of storytelling.

— Ted Sarandos, co-CEO of Netflix

This acquisition will improve our offering and accelerate our business for decades to come. Warner Bros. has helped define entertainment for more than a century and continues to do so with phenomenal creative executives and production capabilities. With our global reach and proven business model, we can introduce a broader audience to the worlds they create — giving our members more options, attracting more fans to our best-in-class streaming service, strengthening the entire entertainment industry, and creating more value for shareholders.

— Greg Peters, co-CEO of Netflix

Today’s announcement combines two of the greatest storytelling companies in the world to bring to even more people the entertainment they love to watch the most. For more than a century, Warner Bros. has thrilled audiences, captured the world’s attention, and shaped our culture. By coming together with Netflix, we will ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come.

— David Zaslav, President and CEO of Warner Bros. Discovery

Netflix reportedly plans to maintain Warner Bros.’ current operations, noting the strengths of its world-class studios and the company’s knack for producing box-office hits, from Barbie and Dune to Superman and A Minecraft Movie. Netflix also promises “more choice and greater value for consumers” by adding the deep film and TV libraries from Warner and HBO to its own catalog of streaming titles. The company says it will be able to “optimize its plans for consumers, enhancing viewing options and expanding access to content,” though we don’t yet know exactly what that will look like. 

For now, both Netflix and the HBO Max streaming service will continue to operate unchanged. What’s certain is that this massive purchase will enhance Netflix’s studio capabilities. The company envisions a “stronger entertainment industry” as being one result of the acquisition. Netflix promises to “significantly expand U.S. production… (and to) continue to grow investment in original content over the long term, which will create jobs and strengthen the entertainment industry.” But many of the most influential industry groups in Hollywood see things differently. The Producers Guild of America (PGA) said in a statement that producers are concerned about the deal and what it might mean for one of Hollywood’s most legendary studios.

For the last century, the entertainment industry has employed millions of Americans, delighted audiences, and showcased the very best of our nation at home and abroad. As we navigate dynamic times of economic and technological change, our industry, together with policymakers, must find a way forward that protects producers’ livelihoods and real theatrical distribution, and that fosters creativity, promotes opportunities for workers and artists, empowers consumers with choices, and upholds freedom of speech. This is the test that the Netflix deal must pass. Our legacy studios are more than content libraries — within their vaults are the character and culture of our nation.

— The Producers Guild of America

And while Netflix promises to create jobs, the Hollywood division of the Teamsters union warns that the acquisition will result in fewer jobs for teamsters, and higher prices for everyone else. “Teamsters have been clear on our position that greed-fueled consolidation of corporate power, no matter what industry, is a direct threat to good union jobs, the livelihood of our members, and the very existence of our industry,” said Lindsay Dougherty, the principal officer of Local 399. “Teamsters will continue to challenge and call for the opposition across all levels of government and that antitrust enforcers reject this deal and any other deal seeking the consolidation of power and market.”

Meanwhile, Netflix paints a picture of increased opportunities for the creative community. The deal will unite “Netflix’s member experience and global reach” with Warner’s extensive library of renowned franchises, resulting in “more opportunities to work with beloved intellectual property, tell new stories, and connect with a wider audience than ever before,” according to a statement from Netflix. But again, the industry groups representing creatives are not convinced. Both the Writers Guild of America and the Directors Guild of America, led by president Christopher Nolan, were among the industry groups expressing doubts about the deal.

The news that Netflix had secured exclusive rights to negotiate for WBD raises significant concerns for the DGA. We believe that a vibrant, competitive industry — one that fosters creativity and encourages genuine competition for talent — is essential to safeguarding the careers and creative rights of directors and their teams. We will be meeting with Netflix to outline our concerns and better understand their vision for the future of the company. While we undertake this due diligence, we will not be commenting further.

— The Directors Guild of America

The world’s largest streaming company swallowing one of its biggest competitors is what antitrust laws were designed to prevent. The outcome would eliminate jobs, push down wages, worsen conditions for all entertainment workers, raise prices for consumers, and reduce the volume and diversity of content for all viewers. Industry workers along with the public are already impacted by only a few powerful companies maintaining tight control over what consumers can watch on television, on streaming, and in theaters. This merger must be blocked.

— The Writers Guild of America

The acquisition was unanimously approved by the Boards of Directors of both Netflix and Warner Bros. Discovery, and that’s no surprise since the move is expected to create value for shareholders. The transaction is still subject to approval of WBD shareholders, but the bigger hurdle might be the required regulatory approvals. In order for the deal to move forward, Netflix may need to quell the concerns of Hollywood’s labor unions, such as SAG-AFTRA, which carries significant political clout. Assuming all goes ahead as planned, the transaction is expected to close in the next 1 to 1.5 years.

The potential Netflix/Warner Bros. transaction is a consolidation that may serve the financial interests of shareholders of both companies, but which raises many serious questions about its impact on the future of the entertainment industry, and especially the human creative talent whose livelihoods and careers depend on it. This $82B transaction reaffirms the true value of legacy media companies and the long term economic prosperity they create, due in large part to the contribution of the creative talent who are at the core of their success. A deal that is in the interest of SAG-AFTRA members and all other workers in the entertainment industry must result in more creation and more production, not less. It must do so in an environment of respect for the talent involved. Any decision about SAG-AFTRA’s position on this transaction will be made with the best interests of SAG-AFTRA members as the standard and following a complete and thorough analysis of the details of the deal, with particular focus on jobs and production commitments.

— SAG-AFTRA

What About Movie Theaters?

Movie theater operators as a group seem to oppose the deal, fearing that Netflix could all but destroy their business model. But Netflix co-CEO Ted Sarandos has said that Netflix has no “opposition to movies in theaters,” and that Warner Bros. movies would still be shown theatrically if the deal goes through. On a conference call with investors and press on December 5th, Sarandos mentioned that Netflix had released 30 films in cinemas in 2025 alone. But the reality is that many of these movies were shown on just a few hundred screens in places like New York and Los Angeles; they were not typical wide releases, which are shown on many thousands of screens. (In order for Netflix originals to qualify for certain awards, such as The Academy Awards, they must debut in theaters. Netflix even owns some movie theaters, such as the historic Egyptian theater in Hollywood.) With many theaters only just beginning to recover from the financial devastation of the COVID-19 pandemic, some of Sarandos’s comments have failed to inspire confidence.

My pushback has been mostly in the fact of the long exclusive (theatrical) windows, which we don’t really think are that consumer friendly,” said Sarandos. Before the COVID pandemic, most movies were shown exclusively in theaters for 90 days before making their way to the home/streaming market. But when folks were staying home because of COVID, many of the big studios renegotiated the amount of time that movies were shown exclusively in theaters. Some movies even became available to stream the same day they were released in theaters. As 2026 approaches, there are still lasting effects from the changes set in motion because of COVID, and many major releases become available to stream within weeks of their theatrical debuts. With this new deal, executives in the theatrical exhibition business can see the writing on the wall. If Netflix has the freedom to start streaming Warner Bros. movies just days after they hit the big screen, it could mean the beginning of the end for movie theaters as we know them.

Right now, you should count on everything that is planned on going to the theater through Warner Bros. (to) continue to go to the theaters through Warner Bros. And Netflix movies… some of them do have a short run in the theater (before streaming). But our primary goal is to bring first-run movies to our (Netflix) members, because that’s what they’re looking for.

— Ted Sarandos, co-CEO of Netflix

It has been widely proven that shorter (theatrical) windows would result in lower revenue generation potential for movies. These lower revenues would inevitably result in theater closures, which would limit consumers’ ability to see movies in the format that filmmakers originally intended. Furthermore, it would result in job losses and economic harm to surrounding businesses to those theater closings. Ultimately, consumers would be worse off.

— Eduardo Acuna, CEO of Regal Entertainment

The proposed acquisition of Warner Bros. by Netflix poses an unprecedented threat to the global exhibition business. The negative impact of this acquisition will impact theaters from the biggest circuits to one-screen independents, in small towns in the United States and around the world. Cinema United (the largest exhibition industry trade group) stands ready to support industry changes that lead to increased movie production and give consumers more opportunities to enjoy a day at the local theater. But Netflix’s stated business model does not support theatrical exhibition. In fact, it is the opposite. Regulators must look closely at the specifics of this proposed transaction and understand the negative impact it will have on consumers, exhibition, and the entertainment industry.

— Michael O’Leary, President and CEO of Cinema United

There are some theater operators who take a more optimistic view. Tim Richards is founder and CEO of Vue Entertainment, Europe’s largest privately-owned cinema operator. Speaking to Variety, he said that Netflix will understand the earnings potential of the big movie franchises that rake in cash at the worldwide box office. “It could be a big win for us,” he said. “Once they’re releasing movies like Barbie or Minecraft that are making a billion dollars in theaters, they’re going understand that our business model can make them a lot of money, while also driving interest in movies when they go on streaming.”

And of course, for Netflix, the bottom line is all about streaming. The company has more than 300 million streaming subscribers worldwide, and it is about to absorb another 128 million subscribers from Warner Bros. Discovery. And the consolidation of these two streaming giants is raising red flags for some influential members of the US government. Senator Elizabeth Warren of Massachusetts sees an antitrust lawsuit waiting to happen. “This deal looks like an anti-monopoly nightmare,” she said in a statement. “A Netflix-Warner Bros. would create one massive media giant with control of close to half of the streaming market — threatening to force Americans into higher subscription prices and fewer choices over what and how they watch, while putting American workers at risk.” Netflix surely has a lot to gain from the acquisition of Warner’s century-deep catalog of content and intellectual property, but its biggest motivation might be simply to absorb — and thereby eliminate — one of its biggest competitors. Members of Congress on both sides of the aisle have warned of potential antitrust problems, including U.S. Senator Mike Lee, a Utah Republican who leads the Senate Judiciary Subcommittee on Antitrust, Competition Policy, and Consumer Rights. According to Reuters, Lee said that the deal “should send alarm to antitrust enforcers around the world.” Republican Senator Roger Marshall of Kansas and Representative Darrell Issa of California said that the deal could lead to fewer movies in theaters, while Congresswoman Pramila Jayapal, a Democrat from Washington, called the acquisition “a nightmare.” Jayapal co-chairs the House Monopoly Busters Caucus. The US president is not typically involved in antitrust approvals when companies seek to merge, but Donald Trump has said that the Netflix Warner Bros. deal “could be a problem” and that he will “be involved in that decision.” Bloomberg News reported that Ted Sarandos visited Trump at the White House in November to discuss the potential deal. According to the report, Sarandos does not expect to face opposition from the White House. Still, Senator Warren called on President Trump and the Justice Department to enforce antitrust laws.

Under Donald Trump, the antitrust review process has… become a cesspool of political favoritism and corruption. The Justice Department must enforce our nation’s anti-monopoly laws fairly and transparently, not use the Warner Bros. deal review to invite influence-peddling and bribery.

— Senator Elizabeth Warren

A deal of this magnitude will probably require approval from the European Commission and other world governments. Here in the USA there is still opportunity for government intervention, but Netflix will argue — successfully, I’d wager — that its spot as the top paid streaming provider does not make the company a monopolist. According to Variety, Netflix represents less than 10% of total TV viewing in this country (per Nielsen), while Warner Bros. Discovery (including HBO Max and Discovery+) represents just 1.3%. Even combined, they lag behind YouTube, which has a 12.9% share.

Netflix Buys Warner Bros. — Final Thoughts

With all this talk about movie theaters and streaming video, one area that we have yet to touch upon is physical media, but this story is sprawling enough as it is. Suffice it to say, fans of physical media worry that Netflix’s acquisition of Warner Bros. could be disastrous for the already-dwindling Blu-ray market. Add their voice of dissent to the chorus of filmmakers, storytellers, lawmakers, and theater operators all singing the same tune.

For the last 15 years or so, the tech industry has been swinging wrecking balls around the established patterns of the entertainment industry. Now, one of the last legacy studios seems to be awaiting its planned demolition at the hands of a tech giant. But Warner Bros. won’t be toppled brick-by-brick — this will be one of those implosive demolitions in which an entire edifice suddenly vanishes under a cloud of dust. At least, that seems to be the consensus coming from Hollywood. While I try not to succumb to cynicism, it’s easy to imagine a scenario in which beloved characters and stories are exploited to maximize customer engagement with little regard for artistic merit. At the same time, it’s worth remembering that Netflix has produced some top-notch TV shows, from Stranger Things and Squid Game to The Crown and The Queen’s Gambit. I adore the Knives Out movies, and my nephew Ben loved KPop Demon Hunters so much that he went to see it in theaters twice after already watching it with me on Netflix.

So, what will the future really look like for Warner Bros. and Netflix? Will this merger create a monster with the power to destroy movie theaters and physical media? Or will it result in more jobs, better movies and TV shows, and happier customers, as Netflix claims? Only time will tell. In the meantime, share your thoughts in the related forum thread below, and stay tuned to Audioholics for further developments.