Netflix Defends Warner Bros Deal as Shares Fall After Tepid Results

Netflix on Wednesday defended its proposed $82.7 billion all-cash bid for Warner Bros Discovery, even as its shares fell after the company reported muted quarterly results and issued a cautious outlook.

Executives said the acquisition is central to Netflix’s long-term strategy as competition in global entertainment intensifies.

Speaking on an earnings call, Netflix co-chief executives Ted Sarandos and Greg Peters said the Warner Bros assets would strengthen Netflix’s content pipeline, expand its film studio presence, and add globally recognised franchises.

They argued the deal would improve scale, lower long-term content risk, and create broader distribution opportunities for creative talent.

• Netflix defends Warner Bros deal as shares slide after results
• Netflix says Warner Bros Discovery bid is key to long-term growth
• Investors wary of $82.7bn acquisition amid cautious Netflix outlook

Netflix has historically avoided large acquisitions, preferring organic growth and in-house production. Management acknowledged the shift but said market conditions have changed, with rivals such as Amazon, Apple and YouTube investing heavily across media, technology and advertising. According to executives, owning Warner Bros’ studio and library would give Netflix greater control over premium intellectual property at a time when licensing costs remain high.

Investors reacted negatively to the results. Netflix shares dropped sharply after the company posted a modest revenue beat but signalled slower growth ahead. The company cited higher content spending, marketing costs, and investment in new business lines as factors weighing on near-term margins. Analysts also flagged concerns about the size of the Warner Bros deal and its impact on cash flow, particularly as Netflix plans to pause share buybacks to preserve capital.

The proposed acquisition is expected to face regulatory scrutiny, especially in the United States and Europe, where antitrust authorities have taken a tougher stance on media consolidation. Netflix said it is prepared for an extended review process and believes the transaction will ultimately benefit consumers through broader choice and improved access to content.

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Despite market scepticism, Netflix said it remains confident that the Warner Bros acquisition will strengthen its competitive position and support sustainable growth in an increasingly crowded streaming market.