In a seismic shift for the global entertainment landscape, streaming titan Netflix has confirmed a monumental agreement to purchase the film and television studios business of Warner Bros Discovery. The deal, valued at a colossal 72 billion US dollars (approximately £54 billion), was announced on Friday 5 December 2025.
The Battle for Hollywood Heritage
Netflix emerged victorious from a fiercely competitive auction process, where it went head-to-head with rival bidders including Paramount Skydance and Comcast, the owner of Sky. The prize is one of Hollywood's most storied studio operations, home to legendary franchises such as Harry Potter and Batman, and the powerhouse behind the HBO and HBO Max streaming services.
The acquisition represents one of the largest media mergers in history and is poised to dramatically accelerate the reshaping of the traditional film and TV industry. This sector has already been undergoing significant upheaval driven by the relentless rise of streaming platforms.
Deal Structure and Regulatory Hurdles
Under the terms of the agreement, Netflix will pay $27.75 (£20.79) per share to Warner Bros Discovery investors. However, the transaction will not finalise immediately. Completion is contingent on Warner Bros Discovery first spinning off its portfolio of cable networks, which features channels like CNN, TBS, and TNT Sports in the UK.
As a result, the process is not anticipated to conclude until at least the third quarter of 2026. Furthermore, the sheer scale of the deal is expected to attract intense scrutiny from competition regulators both in the United States and Europe, who will examine its impact on market competition.
Strategic Vision and Industry Reaction
Netflix leadership, including co-chief executive Ted Sarandos, has stated an intention to maintain Warner Bros' current operations and to continue releasing films in cinemas. Sarandos framed the deal as a union of storytelling giants, combining Netflix's modern hits like Stranger Things and Squid Game with Warner's vast library spanning from classics like Casablanca to perennial favourites like Friends.
Strategically, the move grants Netflix an unparalleled depth of existing film and TV content for its subscribers. It also substantially boosts the company's in-house studio capabilities, paving the way for expanded production capacity and greater long-term investment in original programming.
David Zaslav, president and CEO of Warner Bros Discovery, echoed the sentiment, calling the combination a way to bring beloved entertainment to more people worldwide.
Initial market reaction saw Netflix's share price dip slightly following the announcement. Financial analysts, such as Danni Hewson of AJ Bell, noted that the enormous cash outlay was never likely to delight shareholders immediately. Hewson highlighted that significant regulatory hurdles must be cleared, after which considerable cost savings could be realised. A key question for regulators and consumers in the coming months will be whether Netflix gains excessive pricing power in the streaming market.
