Warner Bros. Discovery reported first-quarter results showing its streaming division, anchored by HBO Max, surpassed 140 million subscribers and remains on track to exceed 150 million by year-end. Despite a net loss of $2.92 billion — driven by a $2.8 billion termination fee paid to Netflix and other merger-related charges — the company highlighted strong growth in streaming revenue and profits. The performance underscores the strategic value of the pending $110 billion merger with Paramount, which has secured shareholder approval but still awaits regulatory greenlights in the U.S. and U.K.

The combined entity is expected to amass over 200 million streaming subscribers, positioning it closer to Disney+ and well behind Netflix’s lead. Executives emphasized HBO Max’s international expansion and pricing strategy as key drivers, while studio profits surged 156% due to increased content licensing. However, linear networks continue to decline, weighed down by the loss of NBA rights and falling pay-TV subscriptions.

Regulatory scrutiny remains a hurdle, with reviews underway by U.S. state attorneys general and foreign investment oversight. If the deal closes after September 30, Warner Bros. Discovery shareholders will receive a quarterly 'ticking fee.' If regulators block the merger, Paramount would pay a $7 billion termination fee. Executives remain focused on efficiency, including AI-driven cost management, to offset linear revenue declines.