Warner Bros. Discovery to Split (Back) in Two
CEO David Zaslav will lead the new Streaming & Studios unit as the company spins off cable networks to simplify operations and boost value after a merger gone sideways.
BREAKING NEWS
Two years after stitching together WarnerMedia and Discovery into a Frankenstein’s monster of prestige television, middling DC Universe movies, and reality schlock, David Zaslav is grabbing the scalpel. Warner Bros. Discovery is splitting back up.
The new plan carves the company into Streaming & Studios (think HBO, Max, Warner Bros. Pictures, scripted TV) and Global Networks (CNN, TNT, TBS, Discovery+, and a bunch of cable channels your parents still watch). Global Networks will hold a 20% stake in Streaming & Studios, mostly so it can use those earnings to chip away at Warner’s mountainous $34 billion debt, which can now go live in a more conveniently siloed home.
If this sounds like a tactical retreat, that’s because it is. The merger was supposed to create a content colossus. Instead, it became a culture clash, a cost-cutting spree, and a stock-price faceplant. WBD shares are down 59% since the deal closed, S&P just downgraded its debt to junk, and Zaslav’s $51.9 million pay package just got rebuked by a majority of shareholders. WBD brought us Succession, and Zaslav is giving us real Kendall Roy energy.
So now it’s back to basics. Zaslav keeps the crown at Streaming & Studios, where the sexier stuff lives. His CFO, Gunnar Wiedenfels, takes over the more lucrative (but fading) cable side. Comcast is doing something similar, spinning off its cable networks into a newco called Versant, but that feels somehow less desperate.
The bet here is simple: the sum of Warner’s parts is worth more than the bloated whole. Investors love clean stories. And separating legacy cable from prestige streaming lets each side live, or die, on its own terms.
It also lets Zaslav say he’s “empowering iconic brands,” which is CEO code for “I need this stock to go up, fast.”
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