Hollywood conglomerate Warner Bros. Discovery on Monday made it official, unveiling plans to separate the company, in a tax-free transaction, into two publicly traded companies, “enabling each to maximize its potential.”
TheStreaming & Studioscompany will consist of Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO, and HBO Max, as well as their legendary film and television libraries.The second business, Global Networks, will include such entertainment, sports and news television brands around the world as CNN, TNT Sports in the U.S., and Discovery, free-to-air channels across Europe, and digital products such as the profitable Discovery+ streaming service and Bleacher Report (B/R).
David Zaslav, president and CEO of Warner Bros. Discovery, will serve as president and CEO of Streaming & Studios. Gunnar Wiedenfels, CFO of Warner Bros. Discovery, will serve as president and CEO of Global Networks. Both will continue in their present roles at WBD until the separation.
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The split is expected to be completed by mid-2026, “subject to closing and other conditions, including final approval by the Warner Bros. Discovery board, receipt of tax opinions and/or a private letter ruling from the Internal Revenue Service with respect to the tax-free nature of the transaction for U.S. federal income tax purposes, and market conditions,” the conglomerate said.
“The cultural significance of this great company and the impactful stories it has brought to life for more than a century have touched countless people all over the world,” Zaslav said in a statement. “It’s a treasured legacy we will proudly continue in this next chapter of our celebrated history.”
He added: “By operating as two distinct and optimized companies in the future, we are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete most effectively in today’s evolving media landscape.”
His CFO highlighted that the separation would “invigorate each company by enabling them to leverage their strengths and specific financial profiles.”
Continued Wiedenfels: “This will also allow each company to pursue important investment opportunities and drive shareholder value. At Global Networks, we will focus on further identifying innovative ways to work with distribution partners to create value for both linear and streaming viewers globally while maximizing our network assets and driving free cash flow.”
WBD top executives will discuss the planned separation during a Monday morning conference call with Wall Street analysts. “Three years ago, the very foundation of how, when, and where audiences engaged with content was undergoing fundamental change,” Zaslav highlighted in a staff memo ahead of the call, obtained by The Hollywood Reporter, in reference to the 2022 combination of WarnerMedia and Discovery. “As both organizations contemplated their futures, one truth became clear: to successfully adapt, transform, and lead in the entertainment industry of tomorrow, we needed to come together — to draw on each other’s strengths.”
Zaslav acknowledged that the combination wasn’t always smooth sailing. “While the work since that merger has been challenging at times, ultimately, we have succeeded in strengthening each element of our business,” he said in the memo. “By bringing together the Discovery and Turner networks, we have created a leader in live andunscripted television, with a truly global footprint operating at industry-leading margins. We’ve transformed our direct-to-consumer offering, as HBO Max is now one of the world’s few global and meaningfully profitable streaming services. And by fusing creative brilliance with operational excellence, we have made strong progress in returning our film and television studios to industry leadership.”
In his memo, Zaslav highlighted what he feels is needed ahead. “As we look at our industry today, we see these forces of generational industry disruption onlyaccelerating,” ge write. “To lead in this new world, we must operate with greater speed, sharper focus, and more creative freedom.”
