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What changed in Warner Bros. Discovery's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Warner Bros. Discovery's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+419 added−391 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-23)

Top changes in Warner Bros. Discovery's 2024 10-K

419 paragraphs added · 391 removed · 302 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

42 edited+29 added−22 removed40 unchanged
Biggest changeMax initially launched in the U.S. and will roll out in international territories, starting in Latin America and the Caribbean in the first quarter of 2024, with more markets in EMEA and APAC to follow later in the year. discovery+ is WBD’s non-fiction, real-life subscription-based streaming service. discovery+ features a wide range of exclusive, original series across popular passion verticals, including lifestyle and relationships; home and food; true crime; paranormal; adventure and natural history; science, tech, and the environment; and a slate of high-quality documentaries.
Biggest changeIn 2025, our content pipeline for HBO and Max includes the highly anticipated returns of The White Lotus , The Last of Us , Hacks , ...And Just Like That , Peacemaker , and The Gilded Age, as well as the series premieres of It: Welcome to Derry and The Eastern Gate . discovery+ is WBD’s non-fiction, real-life subscription-based streaming service. discovery+ features a wide range of series across popular passion verticals, including lifestyle and relationships; home and food; true crime; paranormal; adventure and natural history; science, tech, and the environment; and a slate of high-quality documentaries. discovery+ highlights for 2024 included the premiere of Quiet on Set and the return of the Curious Case of Natalia Grace .
We experience competition for the development and acquisition of content, distribution of our content, sale of commercial time on our networks and viewership. There is competition from other production studios, other television networks, and online-based content providers for the acquisition of content and creative talent such as writers, producers and directors.
We experience competition for the development and acquisition of content, distribution and sale of our content, sale of commercial time on our networks and viewership. There is competition from other production studios, other television networks, and online-based content providers for the acquisition of content and creative talent such as writers, producers and directors.
The Act also gives certain broadcasters the choice of opting out of must-carry and invoking the right to retransmission consent, which refers to a broadcaster’s right to require MVPDs, such as cable and satellite operators, to obtain the broadcaster’s consent before distributing the broadcaster’s signal to the MVPDs’ subscribers, often at a substantial cost that reduces the content funds available for independent programmers not affiliated with broadcasters, such as us.
The Act also gives certain broadcasters the choice of opting out of must-carry and invoking the right to retransmission consent, which refers to a broadcaster’s right to require MVPDs, such as cable and satellite operators, to obtain the broadcaster’s consent before distributing the broadcaster’s signal to the MVPDs’ subscribers, often at a substantial cost that reduces the content funds available for programmers not affiliated with broadcasters, such as us.
WBMPG partners with captivating storytellers to create filmed entertainment for a global audience. DC Studios, tasked with developing properties licensed from DC Comics for film, television and animation, continues the tradition of high-quality storytelling within the DC Universe, while building a sustainable growth business out of the iconic characters. WBTVG consists of Warner Bros.
WBMPG partners with captivating storytellers to create filmed entertainment for a global audience. DC Studios, tasked with developing properties licensed from DC Comics for film, television, animation, and games, continues the tradition of high-quality storytelling within the DC Universe, while building a sustainable growth business out of the iconic characters. WBTVG consists of Warner Bros.
We have made and will continue to make investments in developing technology platforms to support our digital products and streaming services, including Max, HBO Max, and discovery+, and consider these platforms to be intellectual property assets as well. We are a global media and entertainment company and the protection of our content and brands is of primary importance.
We have made and will continue to make investments in developing technology platforms to support our digital products and streaming services, including Max and discovery+, and consider these platforms to be intellectual property assets as well. We are a global media and entertainment company and the protection of our content and brands is of primary importance.
Our compensation programs are designed to implement our compensation philosophy by: • paying competitively, across salary grades and geographies; • applying compensation policies in an internally consistent manner; and • incentivizing our employees to deliver on our short- and long-term objectives. Benefits We provide an array of benefits and programs that support our employees in their personal and professional lives.
Our compensation programs are designed to implement our compensation philosophy by: • paying competitively, across salary grades and geographies; • applying compensation policies in an internally consistent manner; and • incentivizing our employees to deliver on our short- and long-term objectives. 11 Benefits We provide an array of benefits and programs that support our employees in their personal and professional lives.
Our networks and streaming services also compete for their target audiences with all forms of content and other media provided to viewers, including broadcast, cable and local networks, streaming services, pay-per-view and video-on-demand (“VOD”) services, online activities and other forms of news, information and media entertainment.
Our networks, studios and streaming services also compete for their target audiences with all forms of content and other media provided to viewers, including broadcast, cable and local networks, streaming services, pay-per-view and video-on-demand (“VOD”) services, online activities and other forms of news, information and media entertainment.
We continue to closely monitor the ongoing impact of industry trends to our business; however, the full effects on our operations and results will depend on future developments, which are highly uncertain and cannot be predicted. 5 Description of Business Warner Bros.
We continue to closely monitor the ongoing impact of industry trends to our business; however, the full effects on our operations and results will depend on future developments, which are highly uncertain and cannot be predicted. Description of Business Warner Bros.
The SAG-AFTRA strike ended on November 9, 2023, and a new collective bargaining agreement was ratified on December 5, 2023. The strikes had a material impact on the operations and results of the Company, including a pause on certain theatrical and television productions.
The SAG-AFTRA strike ended on November 9, 2023, and a new collective bargaining agreement was ratified on December 5, 2023. The strikes had a material impact on the operations and results of the Company in 2023, including a pause on certain theatrical and television productions.
Segments As of December 31, 2023, we classified our operations in three reportable segments: • Studios - Our Studios segment primarily consists of the production and release of feature films for initial exhibition in theaters, production and initial licensing of television programs to our networks/DTC services as well as third parties, distribution of our films and television programs to various third party and internal television and streaming services, distribution through the home entertainment market (physical and digital), related consumer products and themed experience licensing, and interactive gaming. • Networks - Our Networks segment primarily consists of our domestic and international television networks. • DTC - Our DTC segment primarily consists of our premium pay-TV and streaming services.
Segments As of December 31, 2024, we classified our operations in three reportable segments: • Studios - Our Studios segment primarily consists of the production and release of feature films for initial exhibition in theaters, production and initial licensing of television programs to our networks/DTC services as well as third parties, distribution of our films and television programs to various third party and internal television and streaming services, distribution through the home entertainment market (physical and digital), related consumer products and themed experience licensing, and interactive gaming. • Networks - Our Networks segment primarily consists of our domestic and international television networks. • DTC - Our DTC segment primarily consists of our premium pay-TV and streaming services.
The FCC’s implementation of “must-carry” obligations requires cable operators and DBS providers to give broadcasters preferential access to channel space and favorable channel positions. This reduces the amount of channel space that is available for carriage of our content networks by cable and DBS operators.
The FCC’s implementation of “must-carry” obligations requires cable operators and DBS providers to give broadcasters preferential access to channel space and favorable channel positions. This reduces the amount of channel space that is available for carriage of our content networks by cable and DBS operators on television.
“Must-Carry”/Retransmission Consent The Act imposes “must-carry” regulations on cable systems, requiring them to carry the signals of most local broadcast television stations in their market if they elect mandatory carriage. DBS systems are also subject to their own must-carry rules.
“Must-Carry”/Retransmission Consent The Act imposes “must-carry” regulations on cable systems, requiring them to carry, as part of their cable service, the signals of most local broadcast television stations in their market if they elect mandatory carriage. DBS systems are also subject to their own must-carry rules.
Our networks compete with other television networks, including broadcast, cable and local, for the distribution of our content and fees charged to cable television operators, DTH satellite service providers, and other distributors that carry our content. Our ability to secure distribution agreements is necessary to ensure the retention of our audiences.
Our networks compete with other television networks, including broadcast, cable and local, and with other studios and production companies for the distribution of our content and fees charged to cable television operators, DTH satellite service providers, and other distributors that carry our content. Our ability to secure distribution agreements is necessary to ensure the retention of our audiences.
To support these objectives, our human resources programs are designed to provide competitive, locally-relevant benefits, performance-based pay, and nonfinancial support and incentives. We also strive to enhance our culture through efforts aimed at making our workplace diverse, engaging and inclusive, and to develop our talent to prepare them for critical roles and leadership positions for the future.
To support these objectives, our people and culture programs are designed to provide competitive, locally-relevant benefits, performance-based pay, and nonfinancial support and incentives. We also strive to enhance our culture through efforts aimed at making our workplace engaging and inclusive, and to develop our talent to prepare them for critical roles and leadership positions for the future.
We also provide opportunities for our employees to make an impact in their communities through social good initiatives around the world. Some examples of our human resources programs and initiatives are described below. Compensation Our compensation philosophy is to pay for performance, encourage excellence and reward employees who innovate and deliver high-quality results.
We also provide opportunities for our employees to make an impact in their communities through social good initiatives around the world. Some examples of our people and culture programs and initiatives are described below. Compensation Our compensation philosophy is to pay for performance, encourage excellence and reward employees who innovate and deliver high-quality results.
Our digital products and services are subject to federal and state regulation in the U.S. relating to the privacy and security of personal information collected from our users, including laws pertaining to the acquisition of personal information from children under 16.
Our digital products and services are subject to federal and state laws in the U.S. relating to the privacy and security of personal information collected from our users, including laws pertaining to the acquisition of personal information from children.
Highlights include: • local medical, dental, and vision plans in many countries around the world to support our employees with access to health care, supplementing any state-provided health care; • on-site wellness centers in our New York, Los Angeles, Atlanta and Chiswick (London) offices, a fully-equipped fitness center in our New York, Los Angeles and Atlanta offices, and access to virtual fitness classes and wellbeing programs; • family support programs, including on-site childcare in certain offices, childcare locator services, back-up childcare, maternity/paternity leave, adoption assistance and elder care; • tools and resources to support the mental wellbeing of our employees and their families, including mental health counselors in our on-site wellness centers and a confidential, dedicated line for employees to contact and speak with a counselor in the event they need mental health support; 11 • products and services to support employees’ financial wellbeing, including life, accident, and disability insurance plans, discount benefits, financial planning tools, a 401(k) savings plan in the U.S. and retirement/pension plans in over 20 countries, with competitive contributions from the Company for employees at all levels; • offering an employee stock purchase plan, which allows certain employees globally (where legislation permits) an opportunity to buy WBD common stock at a discounted price through convenient after-tax payroll deductions with no commission charges; and • flexible working arrangements around the globe to enable our employees to better balance work and personal commitments.
Highlights include: • local medical, dental, and vision plans in many countries around the world to support our employees with access to health care, supplementing any state-provided health care; • on-site wellness centers in our New York, Los Angeles, Atlanta, and Chiswick (London) offices, fully-equipped fitness centers in our New York, Los Angeles and Atlanta offices, and access to virtual fitness classes and wellbeing programs; • family support programs, including on-site childcare in certain offices, childcare locator services, back-up childcare, maternity/paternity leave, adoption assistance and elder care; • tools and resources to support the mental wellbeing of our employees and their families, including mental health counselors in our on-site wellness centers and a confidential, dedicated line for employees to contact and speak with a counselor in the event they need mental health support; • products and services to support employees’ financial wellbeing, including life, accident, and disability insurance plans, discount benefits, financial planning tools, a 401(k) savings plan in the U.S. and retirement/pension plans in over 20 countries, with competitive contributions from the Company for employees at all levels; and • offering an employee stock purchase plan, which allows certain employees globally (where legislation permits) an opportunity to buy WBD Series A common stock (“WBD common stock”) at a discounted price through convenient after-tax payroll deductions with no commission charges.
Other headwinds in the industry, such as continued pressures on linear distribution and soft advertising markets in the U.S., have had, and are expected to continue to have, a material impact on the operations and results of the Company, including a negative impact on the results of operations attributed to declines in linear advertising revenue.
Other headwinds in the industry, such as continued pressures on linear distribution and continued softness in the U.S. linear advertising market, have had, and are expected to continue to have, a material impact on the operations and results of the Company, including a negative impact on the results of operations attributed to declines in linear advertising revenue.
HUMAN CAPITAL As of December 31, 2023, we had approximately 35,300 employees, including full-time and part-time employees of our wholly-owned subsidiaries and consolidated ventures, with 53% located in the U.S. and 47% located outside of the U.S. We are a talent-driven business, aiming to attract, develop, and motivate top talent throughout our company.
HUMAN CAPITAL As of December 31, 2024, we had approximately 35,000 employees, including full-time and part-time employees of our wholly-owned subsidiaries and consolidated ventures, with 50% located in the U.S. and 50% located outside of the U.S. We are a talent-driven business, aiming to attract, develop, and motivate top talent throughout our company.
Our content, whether distributed over broadcast, cable, DBS, wireless, or internet-based services, or through other means, is protected under intellectual property law, including copyright, trademark, patent, unfair competition, and internet/domain name statutes and laws and license agreements .
Intellectual Property Laws and Regulations Our intellectual property assets are discussed under “Business – Intellectual Property” above. Our content, whether distributed over broadcast, cable, DBS, wireless, or internet-based services, or through other means, is protected under intellectual property law, including copyright, trademark, patent, unfair competition, and internet/domain name statutes and laws and license agreements .
Additional federal and state laws and regulations apply or may be adopted with respect to our digital products and services, covering such issues as data privacy and security, child safety, oversight of user-generated content, advertising, competition, pricing, content, copyrights and trademarks, access by persons with disabilities, distribution, taxation and characteristics and quality of products and services.
Additional U.S. federal and state laws and regulations apply or may be adopted with respect to our digital products and services, covering such issues as data privacy and security, the online safety of children and teens, dissemination or moderation of user-generated content, advertising, competition, pricing, content, copyrights and trademarks, access by persons with disabilities, distribution, taxation and characteristics and quality of products and services.
The reported number of “subscribers” included herein and the definition of “DTC Subscription” as used herein excludes: (i) individuals who subscribe to DTC products, other than discovery+, HBO, HBO Max, Max, a Premium Sports Product, and independently-branded, regional products (currently consisting of TVN/Player and BluTV) that may be offered by us or by certain joint venture partners or affiliated parties from time to time; (ii) a limited number of international discovery+ subscribers that are part of non-strategic partnerships or short-term arrangements as may be identified by the Company from time to time; (iii) domestic and international Cinemax subscribers, and international basic HBO subscribers; and (iv) users on free trials except for those users on free trial that convert to a DTC Subscription within the first seven days of the next month as noted above. 8 Our networks and streaming services, which include Max, HBO Max, and discovery+, compete for the sale of advertising with other television networks, including broadcast, cable, local networks, and other content distribution outlets for their target audiences and the sale of advertising.
The reported number of “subscribers” included herein and the definition of “DTC Subscription” as used herein excludes: (i) individuals who subscribe to DTC products, other than discovery+, HBO, HBO Max, Max, a Premium Sports Product, and independently-branded, regional products (currently consisting of TVN/Player and BluTV) that may be offered by us or by certain joint venture partners or affiliated parties from time to time; (ii) a limited number of international discovery+ subscribers that are part of non-strategic partnerships or short-term arrangements as may be identified by the Company from time to time; (iii) domestic and international Cinemax subscribers, and international basic HBO subscribers; and (iv) users on free trials except for those users on free trial that convert to a DTC Subscription within the first seven days of the next month as noted above.
We generate revenue from the sale of advertising on our networks and digital platforms (advertising revenue); fees charged to distributors that carry our network brands and programming, including cable, direct-to-home (“DTH”) satellite, telecommunication and digital service providers, as well as through direct-to-consumer (“DTC”) subscription services (distribution revenue); the release of feature films for initial exhibition in theaters, the licensing of feature films and television programs to various television, subscription video on demand (“SVOD”) and other digital markets, distribution of feature films and television programs in the physical and digital home entertainment markets, sales of console games and mobile in-game content, sublicensing of sports rights, and licensing of intellectual property such as characters and brands (content revenue); and other sources such as studio tours and production services (other revenue).
Our asset mix strongly positions us to execute our key strategies: grow our direct-to-consumer (“DTC”) business globally, enhance our Studios segment, and manage our linear networks for the best possible success in order to create long-term value for our shareholders. 5 We generate revenue from fees charged to distributors that carry our network brands and programming, including cable, direct-to-home (“DTH”) satellite, telecommunication and digital service providers, as well as through DTC subscription services (distribution revenue); the sale of advertising on our networks and digital platforms (advertising revenue); the release of feature films for initial exhibition in theaters, the licensing of feature films and television programs to various television, subscription video on demand (“SVOD”) and other digital markets, distribution of feature films and television programs in the physical and digital home entertainment markets, sales of console games and mobile in-game content, sublicensing of sports rights, and licensing of intellectual property such as characters and brands (content revenue); and other sources such as studio tours and production services (other revenue).
The L&D team uses a variety of delivery methods suitable to the content and audience, including live in-person sessions, virtual workshops, webinars, and asynchronous online learning through our global learning management platform. The L&D team also provides tuition reimbursement for eligible courses. AVAILABLE INFORMATION All of our filings with the U.S.
Learning and Development Our Global Learning & Development (“L&D”) team provides learning opportunities for employees around the world. The L&D team uses a variety of delivery methods suitable to the content and audience, including live in-person sessions, virtual workshops, webinars, and asynchronous online learning through our global learning management platform. The L&D team also provides tuition reimbursement for eligible courses.
Further, new technologies such as generative AI and their impact on our intellectual property rights remain uncertain, and development of the law in this area could impact our ability to protect against infringing uses or result in infringement claims against us.
Further, new technologies such as generative AI and their impact on our intellectual property rights remain uncertain, and development of the law in this area could impact our ability to protect against infringing uses or result in infringement claims against us. 9 Third parties may challenge the validity or scope of our intellectual property from time to time, and the success of any such challenges could result in the limitation or loss of intellectual property rights.
For the year ended December 31, 2023, distribution, advertising, content, and other revenues were 54%, 39%, 5%, and 2%, respectively, of total revenues for this segment. 7 DTC WBD’s DTC business includes our streaming services, such as Max, HBO Max, and discovery+ , and premium pay-TV services, such as HBO.
For the year ended December 31, 2024, distribution, advertising, content, and other revenues were 53%, 36%, 9%, and 2%, respectively, of total revenues for this segment. 7 DTC WBD’s DTC business includes our streaming services, such as Max and discovery+ , and premium pay-TV services, such as HBO. Our streaming services are available on most mobile and connected TV devices.
The ability to secure distribution agreements is dependent upon the production, acquisition and packaging of content, viewership, the marketing and advertising support and incentives provided to distributors, the product offering across a series of networks within a region, and the prices charged for carriage. 1 Direct-to-Consumer subscriber - We define a “Core DTC Subscription” as: (i) a retail subscription to discovery+, HBO, HBO Max, Max, or a Premium Sports Product (defined below) for which we have recognized subscription revenue, whether directly or through a third party, from a direct-to-consumer platform; (ii) a wholesale subscription to discovery+, HBO, HBO Max, Max, or a Premium Sports Product for which we have recognized subscription revenue from a fixed-fee arrangement with a third party and where the individual user has activated their subscription; (iii) a wholesale subscription to discovery+, HBO, HBO Max, Max, or a Premium Sports Product for which we have recognized subscription revenue on a per subscriber basis; (iv) a retail or wholesale subscription to an independently-branded, regional product sold on a stand-alone basis that includes discovery+, HBO, HBO Max, Max, and/or a Premium Sports Product, for which we have recognized subscription revenue (as per (i)-(iii) above); and (v) users on free trials who convert to a subscription for which we have recognized subscription revenue within the first seven days of the calendar month immediately following the month in which their free trial expires.
For the year ended December 31, 2024, distribution, advertising, and content revenues were 87%, 8%, and 4%, respectively, of total revenues for this segment. 1 Direct-to-Consumer subscriber - We define a “Core DTC Subscription” as: (i) a retail subscription to discovery+, HBO, HBO Max, Max, or a Premium Sports Product (defined below) for which we have recognized subscription revenue, whether directly or through a third party, from a direct-to-consumer platform; (ii) a wholesale subscription to discovery+, HBO, HBO Max, Max, or a Premium Sports Product for which we have recognized subscription revenue from a fixed-fee arrangement with a third party and where the individual user has activated their subscription; (iii) a wholesale subscription to discovery+, HBO, HBO Max, Max, or a Premium Sports Product for which we have recognized subscription revenue on a per subscriber basis; (iv) a retail or wholesale subscription to an independently-branded, regional product sold on a stand-alone basis that includes discovery+, HBO, HBO Max, Max, and/or a Premium Sports Product, for which we have recognized subscription revenue (as per (i)-(iii) above); and (v) users on free trials who convert to a subscription for which we have recognized subscription revenue within the first seven days of the calendar month immediately following the month in which their free trial expires.
These rules permit the unaffiliated MVPD to initiate a complaint to the FCC against the content vendor and content networks if it believes this rule has been violated. 9 Program Carriage The Act and the FCC’s program carriage rules prohibit MVPDs from favoring their affiliated content networks over unaffiliated, similarly situated content networks in the rates, terms and conditions of their carriage agreements in a manner that unreasonably restrains the ability of the unaffiliated content network to compete fairly.
Program Carriage The Act and the FCC’s program carriage rules prohibit MVPDs from favoring their affiliated content networks over unaffiliated, similarly situated content networks in the rates, terms and conditions of their carriage agreements in a manner that unreasonably restrains the ability of the unaffiliated content network to compete fairly.
The Company defines a “Premium Sports Product” as a strategically prioritized, sports-focused product sold on a stand-alone basis and made available directly to consumers. The current “independently-branded, regional products” referred to in (iv) above consist of TVN/Player and BluTV. We may refer to the aggregate number of DTC Subscriptions as “subscribers”.
The Company defines a “Premium Sports Product” as a strategically prioritized, sports-focused product sold on a stand-alone basis and made available directly to consumers. The current “independently-branded, regional products” referred to in (iv) above consist of TVN/Player and BluTV. Subscribers to multiple WBD DTC products (listed above) are counted as a paid subscriber for each individual WBD DTC product subscription.
In May 2023, WBD launched Max , creating a new destination for HBO Originals, Warner Bros. films, Max Originals, the DC universe, the Wizarding World of Harry Potter, CNN, an expansive offering of kids’ content, and among the best programming across food, home, reality, lifestyle and documentaries from leading brands like HGTV, Food Network, Discovery Channel, TLC, ID and more.
Max is a streaming destination for a variety of programming including HBO Originals, Warner Bros. films, Max Originals, the DC universe, the Wizarding World of Harry Potter, CNN, and programming across food, home, reality, lifestyle, and documentaries from leading brands like HGTV, Food Network, Discovery Channel, and more.
Regulation of Digital Products and Services We operate a variety of free, advertising-based and subscription-based digital products and streaming services providing news, information and entertainment to consumers in the U.S. and international markets via web, mobile and connected TV platforms.
Obscenity Restrictions MVPDs are prohibited from transmitting obscene content, and our distribution agreements generally require us to refrain from including such content on our networks. 10 Regulation of Digital Products and Services We operate a variety of free, advertising-based and subscription-based digital products and streaming services providing news, information and entertainment to consumers in the U.S. and international markets via web, mobile and connected TV platforms.
Commercials embedded in our networks’ television content stream also must adhere to certain standards for ensuring that those commercials are not transmitted at louder volumes than our program material. Obscenity Restrictions MVPDs are prohibited from transmitting obscene content, and our distribution agreements generally require us to refrain from including such content on our networks.
Commercials embedded in our networks’ television content stream also must adhere to certain standards for ensuring that those commercials are not transmitted at louder volumes than our program material.
Some examples of these laws include the federal Children’s Online Privacy Protection Act (COPPA), the federal Controlling the Assault of Non-Solicited Pornography and Marketing Act, the Video Privacy Protection Act (VPPA), and the California Consumer Privacy Act (“CCPA”). Many additional U.S. state and federal regulations impose data security and data breach obligations on the Company.
Some examples of these laws include the federal Children’s Online Privacy Protection Act (COPPA), the federal Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN SPAM), the Video Privacy Protection Act (VPPA), and the California Consumer Privacy Act (CCPA).
The scope of regulation may differ depending on how these products and services are used and/or purchased. In addition, the FCC from time to time considers whether some or all digital services should be considered MVPDs and regulated as such. 10 Intellectual Property Laws and Regulations Our intellectual property assets are discussed under “Business – Intellectual Property” above.
The scope of regulation may differ depending on how these products and services are used and/or purchased. In addition, the FCC from time to time considers whether some or all digital services should be considered MVPDs and regulated as such, or otherwise subjected to rules that apply to traditional communications providers. Such determination would increase our regulatory burdens substantially.
Third parties may challenge the validity or scope of our intellectual property from time to time, and the success of any such challenges could result in the limitation or loss of intellectual property rights. Irrespective of their validity, such claims may also result in substantial costs and diversion of resources which could have an adverse effect on our operations.
Irrespective of their validity, such claims may also result in substantial costs and diversion of resources which could have an adverse effect on our operations.
Games , a worldwide publisher, developer, licensor, and distributor of content for the interactive space across all platforms, including console, handheld, mobile, and PC-based gaming for both internal and third-party game titles. Based on the Wizarding World of Harry Potter franchise, Warner Bros. Games launched Hogwarts Legacy in 2023, which became the #1 game of the year globally.
Games , a worldwide publisher, developer, licensor, and distributor of content for the interactive space across all platforms, including console, handheld, mobile, and PC-based gaming for both internal and third-party game titles. In September 2024, WBD announced a new global structure for the Company’s worldwide studio tours, retail destinations, touring exhibitions, and all location-based experiences.
Networks WBD’s linear network operations include general entertainment, lifestyle, and news networks in the U.S., as well as a host of international media networks and global sports networks. General entertainment networks in the U.S. include TNT , cable’s #1 entertainment network; TBS , a top-rated destination for television among young adults; and Turner Classic Movies .
For the year ended December 31, 2024, content and other revenues were 92% and 8%, respectively, of total revenues for this segment. Networks WBD’s linear network operations include general entertainment, lifestyle, and news networks in the U.S., as well as a host of international media networks and global sports networks.
WBD Sports Europe features Eurosport, a leading sport destination and the home of the Olympic Games in Europe, as well as the Global Cycling Network (“GCN”), and Global Mountain Bike Network (“GMBN”). TNT Sports’ owned-and-operated platforms include Bleacher Report, Eurosport.com, House of Highlights, HighlightHER, and a full suite of digital and social brands.
TNT Sports’ owned-and-operated platforms include Bleacher Report, Eurosport.com, House of Highlights , Golf Digest, and a full suite of digital and social brands.
Additional lifestyle networks include Travel Channel, Science Channel, TLC, and Hogar de HGTV among many others. In 2023, CNN , our global news brand, launched CNN Max in the U.S., giving audiences the ability to access a combination of on-air CNN content and exclusive programming on WBD’s streaming service, Max.
In 2024, CNN , our global news brand, launched CNN International in Europe on Max, giving audiences the ability to access a combination of on-air CNN content and exclusive programming on WBD’s streaming service in Spain, Nordics, Belgium, Netherlands, and Central and Eastern Europe. TNT Sports is a global leader in the delivery of premium sports content.
Discovery is a premier global media and entertainment company that provides audiences with a differentiated portfolio of content, brands and franchises across television, film, streaming, and gaming. Some of our iconic brands and franchises include Warner Bros. Motion Picture Group, Warner Bros.
Discovery is a leading global media and entertainment company that creates and distributes a differentiated and comprehensive portfolio of content and products across television, film, streaming, interactive gaming, publishing, themed experiences, and consumer products through brands including: Discovery Channel, Max, CNN, DC Studios, TNT Sports, HBO, Food Network, TLC, TBS, Warner Bros. Motion Picture Group, Warner Bros.
WBD’s other entertainment networks include OWN, Discovery Channel, Cartoon Network, Adult Swim, and truTV among many others.
General and lifestyle entertainment networks in the U.S. include TNT , TBS , Turner Classic Movies , OWN , HGTV , Food Network , TLC , Discovery Channel and Adult Swim , among many others.
Our streaming services are available on most mobile and connected TV devices. As of December 31, 2023, we had 97.7 million DTC subscribers 1 . HBO is one of the most respected and innovative entertainment brands in the world, serving iconic, award-winning programming through the HBO linear channels and our DTC streaming service, Max.
HBO is one of the most respected and innovative entertainment brands in the world, serving iconic, award-winning programming through the HBO linear channels and our DTC streaming service, Max. In 2024, HBO’s crime drama The Penguin earned positive reviews and grew its premiere-night audience by 54% from debut to finale.
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Merger with the WarnerMedia Business of AT&T On April 8, 2022 (the “Closing Date”), Discovery, Inc. (“Discovery”) completed its merger (the “Merger”) with the WarnerMedia business (the “WarnerMedia Business”, “WM Business” or “WM”) of AT&T Inc. (“AT&T”) and changed its name to Warner Bros. Discovery, Inc.
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The Company experienced content completion and delivery delays in the first quarter of 2024 due to the pause in television and theatrical productions in 2023, but did not experience any material impacts for the remainder of 2024.
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On April 11, 2022, the Company’s shares started trading on the Nasdaq Global Select Market (“Nasdaq”) under the trading symbol WBD. The Merger was executed through a Reverse Morris Trust type transaction, under which WM was distributed to AT&T’s shareholders via a pro rata distribution, and immediately thereafter, combined with Discovery.
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In addition, declines in linear subscribers are expected to continue. The increase of digital advertising available in the marketplace has also resulted in, and is expected to continue to result in, increased competition for advertising expenditures for both traditional linear networks and ad-supported tiers in streaming services.
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(See Note 3 and Note 4 to the accompanying consolidated financial statements). Prior to the Merger, WarnerMedia Holdings, Inc. (“WMH”) distributed $40.5 billion to AT&T (subject to working capital and other adjustments) in a combination of cash, debt securities, and WM’s retention of certain debt. Discovery transferred purchase consideration of $42.4 billion in equity to AT&T shareholders in the Merger.
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Television Group, Warner Bros. Games, Adult Swim, Turner Classic Movies, and others. We are home to one of the largest collections of owned content in the world with assets and intellectual property across sports, news, lifestyle, and entertainment in most languages and regions of the globe.
Removed
In August 2022, the Company and AT&T finalized the post-closing working capital settlement process, which resulted in the Company receiving a $1.2 billion payment from AT&T in the third quarter of 2022 in lieu of adjusting the equity issued as consideration in the Merger.
Added
We create some of the best-in-class content using our renowned library, beloved franchises, and acclaimed creative expertise to serve our audiences and consumers.
Removed
AT&T shareholders received shares of WBD Series A common stock (“WBD common stock”) in the Merger representing 71% of the combined Company and the Company’s pre-Merger shareholders continued to own 29% of the combined Company, in each case on a fully diluted basis.
Added
Corporate Reorganization On December 12, 2024, the Company announced that its board of directors had authorized the Company to implement a new corporate structure designed to enhance the Company’s strategic flexibility and create potential opportunities to unlock shareholder value.
Removed
Discovery was deemed to be the accounting acquirer of the WM Business for accounting purposes under U.S. generally accepted accounting principles (“U.S. GAAP”); therefore, Discovery is considered the Company’s predecessor and the historical financial statements of Discovery prior to April 8, 2022, are reflected in this Annual Report on Form 10-K as the Company’s historical financial statements.
Added
Under the new corporate structure, the Company will serve as the parent company for two distinct operating divisions: Global Linear Networks and Streaming & Studios.
Removed
Accordingly, the financial results of the Company as of and for any periods prior to April 8, 2022 do not include the financial results of the WM Business and current and future results will not be comparable to results prior to the Merger.
Added
To facilitate the implementation of this new structure and the movement of entities and assets to align with the new operating divisions, on January 1, 2025, the Company completed certain transactions, including (1) a merger of Discovery Holding Company with and into a newly formed subsidiary of WarnerMedia Holdings, Inc.
Removed
Television Group, DC, HBO, HBO Max, Max, discovery+, CNN, Discovery Channel, HGTV, Food Network, TNT Sports, TBS, TLC, OWN, Warner Bros. Games, Batman, Superman, Wonder Woman, Harry Potter, Looney Tunes, Hanna-Barbera, Game of Thrones, and The Lord of the Rings. We are home to powerful creative engines and one of the largest collections of owned content in the world.
Added
(the “DHC Merger”) and (2) a merger of a second newly formed subsidiary of WarnerMedia Holdings, Inc. with and into Scripps Networks Interactive, Inc. (the “Scripps Merger”). As a result of the DHC Merger, Discovery Communications, LLC became an indirect subsidiary of WarnerMedia Holdings, Inc.
Removed
WBD has one of the strongest hands in the industry in terms of the completeness and quality of assets and intellectual property across sports, news, lifestyle, and entertainment in virtually every region of the globe and in most languages. We serve audiences and consumers around the world with content that informs, entertains, and, when at its best, inspires.
Added
As a result of the Scripps Merger, Scripps Networks Interactive, Inc. became a direct subsidiary of WarnerMedia Holdings, Inc.
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Our asset mix positions us to drive a balanced approach to creating long-term value for shareholders.
Added
Animation, Cartoon Network Studios, and Hanna-Barbera Studios Europe . 6 Among the Studios segment’s content highlights for 2024 were Dune: Part Two, Beetlejuice, Beetlejuice and Godzilla x Kong: The New Empire on the film side, with Warner Bros. Discovery becoming the first studio to cross the $1 billion mark at the worldwide box office that year.
Removed
It represents the full entertainment ecosystem, and the ability to serve consumers across the entire spectrum of offerings from domestic and international networks, premium pay-TV, streaming, production and release of feature films and original series, related consumer products and themed experience licensing, and interactive gaming.
Added
Award-winning TV titles for 2024 include Abbott Elementary , Shrinking, and The Voice. As of December 31, 2024, the new series The Penguin remains one of the most-watched debut seasons globally of any current HBO or Max show, behind only House of the Dragon and The Last of Us .
Removed
Animation, Cartoon Network Studios, and Hanna-Barbera Studios Europe . 6 Among the Studios segment’s content highlights for 2023 were Barbie, the #1 movie of the year globally based on worldwide gross revenue , Wonka, Aquaman and the Lost Kingdom, and The Nun II on the film side and award-winning TV titles including Abbott Elementary , Ted Lasso , Night Court, Shrinking, Genndy Tartakovsky’s Primal, The Golden Bachelor, and The Voice.
Added
WBD Global Experiences brings together the previous Global Themed Entertainment licensing group and the Studio Tours & Retail owned and operated group into a single worldwide division to develop and execute on global strategies that offer partners a mix of both group models, putting WBD in a position to drive growth and become a worldwide leader in the creation, development, licensing, and operation of location-based entertainment inspired by Harry Potter , DC, Looney Tunes, Scooby-Doo , Game of Thrones , Friends , Discovery and more.
Removed
Part of the Worldwide Studio Operations group , Warner Bros. Studio Tour London – The Making of Harry Potter and Warner Bros. Studio Tour Hollywood attract visitors from around the world, giving fans the opportunity to get closer to the entertainment they love. In June of 2023, the Worldwide Studios Operations group opened the Warner Bros.
Added
The TNT Sports U.S. portfolio includes expansive, multi-platform partnerships with the National Basketball Association (“NBA”), Major League Baseball, the National Collegiate Athletic Association (“NCAA”) Division I Men’s Basketball Championship, National Hockey League, United States Soccer Federation, Unrivaled, National Association for Stock Car Auto Racing, Roland-Garros, NCAA Big 12 Football and Men’s Basketball, and NCAA Big East Men’s and Women’s Basketball.
Removed
Studio Tour Tokyo – The Making of Harry Potter, a new experience that was the first Warner Bros. Studio Tour to open in Asia. For the year ended December 31, 2023, content and other revenues were 93% and 7%, respectively, of total revenues for this segment.
Added
Additionally, TNT Sports co-manages NCAA.com and NCAA March Madness Live, along with NBA Digital including NBA TV, the NBA App and NBA.com. Bleacher Report and House of Highlights, digital destinations for young adult sports fans, are owned and operated by TNT Sports.
Removed
Leading the lifestyle category are Magnolia Network , comprised of a collection of inspiring original series curated by Chip and Joanna Gaines featuring some of the U.S.’s most talented names in home and design, food, gardening, and the arts; HGTV , with relatable stories, real estate and renovation experts and home transformations; and Food Network , which connects viewers to the power and joy of food.
Added
In March 2024, TNT Sports also premiered a primetime sports programming block on truTV consisting of live sports, original sports shows, and ancillary sports content.
Removed
WBD Sports (rebranded in January 2024 as TNT Sports) is a global leader in premium sports content across multiple platforms, engaging fans in the U.S. and internationally. TNT Sports’ U.S. sports rights include the National Basketball Association (“NBA”), Major League Baseball (“MLB”), National Collegiate Athletic Association (“NCAA”), National Hockey League (“NHL”), and United States Soccer Federation (“USSF”).
Added
TNT Sports in the United Kingdom and Ireland includes live coverage of Australian Open and Roland-Garros tennis; Grand Tour cycling; the Union Cycliste Internationale Mountain Bike World Series; World Championship and World Cup winter sports events; British and World Superbikes; snooker; Olympic Games 2026-2032; Premier League; Union of European Football Associations club football; Premiership men’s and women’s rugby; MotoGP; international cricket; Ultimate Fighting Championship and boxing, which are all available on TNT Sports and its streaming home, discovery+.
Removed
In 2023, WBD exited its regional sports business (“AT&T SportsNets”) in the U.S. In addition to the global networks described above, we operate networks internationally. TVN operates a portfolio of free-to-air and pay-TV lifestyle, entertainment, and news networks in Poland.
Added
As of December 31, 2024, we had 116.9 million DTC subscribers 1 . Our strong subscriber growth this year has driven increased revenue and profitability for the DTC segment. In 2025 and 2026, we anticipate additional launches of our streaming services in major markets.
Removed
Max, HBO Max, and discovery+ currently feature both ad-free and ad-lite versions. For the year ended December 31, 2023, distribution, advertising, and content revenues are 86%, 5%, and 9%, respectively, of total revenues for this segment. COMPETITION Providing content across various distribution platforms is a highly competitive business worldwide.
Added
The Penguin also earned Colin Farrell a Golden Globe Award in the category for Best Performance by a Male Actor in a Limited Series, Anthology Series, or a Motion Picture Made for Television. Another standout was True Detective: Night Country , which became the series’ most watched season, receiving 19 Emmy nominations and one win for Jodie Foster’s performance.
Removed
These laws and their public and private enforcement are continually evolving, with several comprehensive U.S. state privacy laws that took effect in 2023, or that will take effect in 2024, and many more introduced and expected to pass in the coming year, and novel litigation theories related to privacy advancing in the courts.
Added
New HBO series highlights include Dune: Prophecy and Like Water for Chocolate , both of which have already been renewed for a second season. Other hit HBO series that returned to critical acclaim in 2024 included House of the Dragon and Hacks , a Golden Globe winner for Best Television Series - Musical or Comedy.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

97 edited+30 added−20 removed121 unchanged
Biggest changeSignificant negative industry or economic trends, including the continued decline of traditional linear television viewership and linear ad revenues, disruptions to our business, inability to effectively integrate acquired businesses, underperformance of our content, unexpected significant changes or planned changes in use of the assets, including in connection with restructuring initiatives, divestitures and market capitalization declines may impair goodwill and other intangible assets.
Biggest changeFor example, continued negative industry or economic trends, including the decline of traditional linear television viewership and linear ad revenues, declining levels of global GDP growth and soft advertising markets in the U.S., disruptions to our business, inability to effectively integrate acquired businesses, execution risk associated with anticipated growth in our DTC products, underperformance of our content, failure to renew content licenses and distribution agreements, including affiliate and sports rights renewals, unexpected significant changes or planned changes in use of the assets, including in connection with restructuring initiatives, divestitures and continued decline in our market capitalization could negatively affect our estimates of the fair value of our reporting units.
These risks include: • laws and policies affecting trade and taxes, including laws and policies relating to the repatriation of funds and withholding taxes, and changes in these laws; • local regulatory requirements (and any changes to such requirements), including restrictions on content, censorship, imposition of local content quotas, local production levies and investment obligations, and restrictions or prohibitions on foreign ownership, outsourcing, consumer protection, targeted advertising, intellectual property and related rights, including copyright and rightsholder rights and remuneration; • our ability to obtain the appropriate licenses and other regulatory approvals we need to distribute content in foreign countries as well as regulatory intervention on how we currently operate, including how we license and distribute content; • differing degrees of protection for intellectual property and varying attitudes towards the piracy of intellectual property; • foreign exchange regulations, or significant fluctuations in foreign currency value and foreign exchange rates, as further described below in this Item 1A; • capital, currency exchange and central banking controls; • the instability of foreign economies and governments; • the potential for political, social, or economic unrest, terrorism, hostilities, cyber-attacks or war, including the ongoing conflicts in Europe and the Middle East; • anti-corruption laws and regulations such as the Foreign Corrupt Practices Act and the U.K.
These risks include: • laws and policies affecting trade and taxes, including tariffs and laws and policies relating to the repatriation of funds and withholding taxes, and changes in these laws; • local regulatory requirements (and any changes to such requirements), including restrictions on content, censorship, imposition of local content quotas, local production levies and investment obligations, and restrictions or prohibitions on foreign ownership, outsourcing, consumer protection, targeted advertising, intellectual property and related rights, including copyright and rightsholder rights and remuneration; • our ability to obtain the appropriate licenses and other regulatory approvals we need to distribute content in foreign countries as well as regulatory intervention on how we currently operate, including how we license and distribute content; • differing degrees of protection for intellectual property and varying attitudes towards the piracy of intellectual property; • foreign exchange regulations, or significant fluctuations in foreign currency value and foreign exchange rates, as further described below in this Item 1A; • capital, currency exchange and central banking controls; • the instability of foreign economies and governments; • the potential for political, social, or economic unrest, terrorism, hostilities, cyber-attacks or war, including the ongoing conflicts in Europe and the Middle East; • anti-corruption laws and regulations such as the Foreign Corrupt Practices Act and the U.K.
Under the 2017 Tax Cuts and Jobs Act, we were subject to U.S. taxes for the deemed repatriation of certain cash balances held by foreign corporations. The Company intends to continue to permanently reinvest these funds outside of the U.S., and current plans do not demonstrate a need to repatriate them to fund our U.S. operations.
Under the 2017 Tax Cuts and Jobs Act, we were subject to U.S. taxes for the deemed repatriation of certain cash balances held by foreign corporations. The Company intends to continue to permanently reinvest some of these funds outside of the U.S., and current plans do not demonstrate a need to repatriate them to fund our U.S. operations.
Because our content and pay-TV networks are licensed to and distributed through third parties, such as traditional television and pay-TV broadcasters (such as cable and satellite operators) and operators of digital platforms, which in turn make such content available, directly and indirectly, to consumers, we are dependent upon the maintenance of such licensing and distribution agreements with such third parties.
Because our content and pay-TV networks are licensed to and distributed through third parties, such as traditional television and pay-TV broadcasters (such as cable and satellite operators) and operators of digital platforms, which in turn make such content available, directly and indirectly, to consumers, we are dependent upon the maintenance of these licensing and distribution agreements with such third parties.
In connection with the Merger, multiple putative class action lawsuits relating to the Merger were filed on behalf of stockholders of the Company against the Company and/or certain of our directors and executive officers seeking damages and other relief, and we have been engaged in other disputes arising out of definitive agreements entered into in connection with the Merger.
In connection with the Merger, multiple putative class action lawsuits relating to the Merger were filed on behalf of stockholders of the Company against the Company and/or certain of our directors, executive officers and large stockholders seeking damages and other relief, and we have been engaged in other disputes arising out of definitive agreements entered into in connection with the Merger.
Any impairment of our intellectual property rights, including due to changes in U.S. or foreign laws, the absence of effective legal protections or enforcement measures, or the inability to negotiate license or distribution agreements with third parties, could materially adversely impact our business, financial condition, and results of operations.
Additionally, any impairment of our intellectual property rights, including due to changes in U.S. or foreign laws, the absence of effective legal protections or enforcement measures, or the inability to negotiate license or distribution agreements with third parties, could materially adversely impact our business, financial condition, and results of operations.
If our DTC products fail to attract and retain subscribers, our business, financial condition and results of operations may be adversely impacted. Our Max, HBO Max and discovery+ offerings are subscription-based streaming services and are among many such services in a crowded and highly competitive landscape.
If our DTC products fail to attract and retain subscribers, our business, financial condition and results of operations may be adversely impacted. Our Max and discovery+ offerings are subscription-based streaming services and are among many such services in a crowded and highly competitive landscape.
We are subject to domestic and international privacy and data protection laws, which impact our ability to collect, manage, and use personal information. Our efforts to comply with such laws, which are continually evolving, could impose costly obligations on us and generate additional regulatory and litigation risk.
We are subject to domestic and international privacy and data protection laws, which impact our ability to collect and use personal information. Our efforts to comply with such laws, which are continually evolving, could impose costly obligations on us and generate additional regulatory and litigation risk.
Irrespective of their validity, such claims may result in substantial costs and diversion of resources which could have an adverse effect on our operations. Our success depends on attracting, developing, motivating and retaining key employees and creative talent within our business.
Irrespective of their validity, such claims may result in substantial costs and diversion of resources which could have an adverse effect on our operations. 24 Our success depends on attracting, developing, motivating and retaining key employees and creative talent within our business.
This exposure to exchange rate fluctuations could have an adverse effect on our reported results of operations and net asset balances. 20 Increasing complexity of global tax policy and regulations could increase our tax liability and adversely impact our business and results of operations.
This exposure to exchange rate fluctuations could have an adverse effect on our reported results of operations and net asset balances. Increasing complexity of global tax policy and regulations could increase our tax liability and adversely impact our business and results of operations.
If existing subscribers, including those who receive subscriptions through wireless and broadband bundling arrangements with third parties or through wholesale arrangements with MVPDs, cancel or discontinue their subscriptions for any reason, including as a result of selecting an alternative wireless or broadband plan that does not bundle our products, canceling or discontinuing their MVPD subscription, or due to the availability of competing offerings that are perceived to offer greater value compared to our DTC products, our business may be adversely affected.
If existing subscribers, including those who receive subscriptions through wireless, broadband, or streaming bundling arrangements with third parties or through wholesale arrangements with MVPDs, cancel or discontinue their subscriptions for any reason, including as a result of selecting an alternative wireless or broadband plan that does not bundle our products, canceling or discontinuing their MVPD subscription, or due to the availability of competing offerings that are perceived to offer greater value compared to our DTC products, our business may be adversely affected.
If we are unable to effectively reduce and sustain our leverage ratio, it could have significant negative consequences on our financial condition and results of operations, including: • impairing our ability to meet one or more of the financial ratio covenants contained in our revolving credit facility or to generate cash sufficient to pay the interest or principal, which could result in an acceleration of some or all of our outstanding debt in the event that an uncured default occurs; • increasing our vulnerability to adverse economic and market conditions; • limiting our ability to obtain additional debt or equity financing; • requiring the dedication of a substantial portion of our cash flow from operations to service our debt, thereby reducing the amount of cash flow available for other purposes such as capital expenditures, investments, share repurchases, and mergers and acquisitions; 21 • requiring us to sell debt or equity securities or to sell some of our core assets, possibly on unfavorable terms, to meet payment obligations; • limiting our flexibility in planning for, or reacting to, changes in our business and the markets in which we compete; and • placing us at a possible competitive disadvantage with less leveraged competitors and competitors that may have better access to capital resources.
If we are unable to effectively reduce and sustain our leverage ratio, it could have significant negative consequences on our financial condition and results of operations, including: • impairing our ability to meet one or more of the financial ratio covenants contained in our revolving credit facility or our term loan credit facility or to generate cash sufficient to pay the interest or principal, which could result in an acceleration of some or all of our outstanding debt in the event that an uncured default occurs; • increasing our vulnerability to adverse economic and market conditions; • limiting our ability to obtain additional debt or equity financing; • requiring the dedication of a substantial portion of our cash flow from operations to service our debt, thereby reducing the amount of cash flow available for other purposes such as capital expenditures, investments, share repurchases, and mergers and acquisitions; • requiring us to sell debt or equity securities or to sell some of our core assets, possibly on unfavorable terms, to meet payment obligations; 18 • limiting our flexibility in planning for, or reacting to, changes in our business and the markets in which we compete; and • placing us at a possible competitive disadvantage with less leveraged competitors and competitors that may have better access to capital resources.
We incurred significant costs following the closing of the Merger, including costs relating to organization restructuring, facility consolidation activities and other contract termination costs, which costs we believe were necessary to realize the anticipated cost synergies from the Merger.
We have incurred significant costs following the closing of the Merger, including costs relating to organization restructuring, facility consolidation activities and other contract termination costs, which costs we believe were necessary to realize the anticipated cost synergies from the Merger.
In certain geographic regions, our ability to fully capture viewership information may be limited by local laws and regulations. As further discussed in other parts of this Item 1a.
In certain geographic regions, our ability to fully capture viewership information may be limited by local laws and regulations. 13 As further discussed in other parts of this Item 1a.
In addition, under our charter, we have not opted out of the protections of Section 203 of the Delaware General Corporation Law (the “DGCL”), and we are therefore governed by Section 203.
In addition, under our charter, we have not opted out of the protections of Section 203 of the Delaware General Corporation Law, and we are therefore governed by Section 203.
For example, there may be the potential for a conflict of interest when we, on the one hand, or Advance/Newhouse and/or one or more of the Liberty Entities, on the other hand, consider acquisitions and other corporate opportunities that may be suitable for the other. The members of our board of directors have fiduciary duties to us and our stockholders.
For example, there may be the potential for a conflict of interest when we, on the one hand, or one or more of the Liberty Entities, on the other hand, consider acquisitions and other corporate opportunities that may be suitable for the other. The members of our board of directors have fiduciary duties to us and our stockholders.
As of December 31, 2023, we were an employer that provided more than 5% of total contributions to certain of the multiemployer plans in which we participate. If we choose to stop participating or substantially reduce participation in certain of these plans, we may be subject to a withdrawal liability.
As of December 31, 2024, we were an employer that provided more than 5% of total contributions to certain of the multiemployer plans in which we participate. If we choose to stop participating or substantially reduce participation in certain of these plans, we may be subject to a withdrawal liability.
The increase of digital advertising available in the marketplace, due to both the introduction of ad-supported tiers in competing streaming services and the expansion of free ad-supported television (“FAST”) products, has increased the competition we face for advertising expenditures for both our traditional linear networks and the ad-supported tiers in our streaming services, and also limited our ability to demand higher rates for our linear and digital advertising inventory or even the same rates that we previously charged for our advertising inventory prior to the surge in digital advertising.
The increase of digital advertising available in the marketplace, due to both the introduction of ad-supported tiers in competing streaming services and the expansion of free ad-supported television (“FAST”) products, has increased, and is expected to continue to increase, the competition we face for advertising expenditures for both our traditional linear networks and the ad-supported tiers in our streaming services, and has also limited our ability to demand higher rates for our linear and digital advertising inventory or even the same rates that we previously charged for our advertising inventory prior to the surge in digital advertising.
Therefore, the underperformance of a feature film, especially an “event” film, upon its public release can result in lower-than-expected revenues for our business which could limit our ability to create future content.
Therefore, the underperformance of a feature film, especially an “event” film, upon its theatrical release can result in lower-than-expected revenues for our business which could limit our ability to create future content.
In particular, decreases in consumer discretionary spending in the markets where our DTC products are offered may reduce our ability to attract and retain subscribers to our services, which could have a negative impact on our business.
Further, decreases in consumer discretionary spending in the markets where our DTC products are offered may reduce our ability to attract and retain subscribers to our services, which could have a negative impact on our business.
We have a significant amount of debt and may incur significant amounts of additional debt, which could adversely affect our financial health and our ability to react to changes in our business and our ability to incur debt, and the use of our funds could be limited by the restrictive covenants in the agreements governing our revolving credit facility and senior notes.
We have a significant amount of debt and may incur additional debt, which could adversely affect our financial health and our ability to react to changes in our business and our ability to incur debt, and the use of our funds could be limited by the restrictive covenants in the agreements governing our credit agreements and senior notes.
We may also spend substantial resources complying with various government standards, which may entail related investigations and litigation. We may incur significant expenses defending such suits or government charges and may be required to pay amounts or otherwise change our operations in ways that could materially adversely affect our business, financial condition and results of operations.
We also spend substantial resources complying with various government standards, including any related investigations and litigation. We may incur significant expenses defending such suits or government charges and may be required to pay amounts or otherwise change our operations in ways that could materially adversely affect our business, financial condition and results of operations.
In order to respond to this decline, changing consumer behavior, increasing preferences to watch on demand, and changes in content distribution models in the media and entertainment industries, we have invested in, developed and launched streaming services including Max, HBO Max and discovery+.
In order to respond to this decline, changing consumer behavior, increasing preferences to consume content on demand, and changes in content distribution models in the media and entertainment industries, we have invested in, developed and launched streaming services including Max and discovery+.
If we are unable to meet our enterprise objectives, or live up to evolving stakeholder expectations and industry standards for environmental, social and governance issues, or if we are perceived by consumers, stockholders or employees to have not responded appropriately with respect to these issues, our reputation, and therefore our ability to sell our products and services, could be negatively impacted.
Additionally, if we are unable to live up to evolving stakeholder expectations and industry standards for environmental, social and governance issues, or if we are perceived by consumers, stockholders or employees to have not responded appropriately with respect to these issues, our reputation, and therefore our ability to sell our products and services, could be negatively impacted.
Risks Related to Our Financial, Capital and Corporate Structure Forecasting our financial results requires us to make judgements and estimates which may differ materially from actual results.
Risks Related to Our Financial, Capital and Corporate Structure Forecasting our financial results requires us to make judgments and estimates which may differ materially from actual results.
U.S. state and federal regulators, international regulators, investors, consumers and other stakeholders are increasingly focused on environmental, social, and governance considerations. For example, new domestic and international laws and regulations relating to environmental, social and governance matters, including environmental sustainability and climate change, human capital management, and cybersecurity, are under consideration or have been adopted.
U.S. regulators, international regulators, investors, consumers and other stakeholders are increasingly focused on environmental, social, and governance considerations. For example, domestic and international laws and regulations relating to environmental, social and governance matters, including environmental sustainability and climate change, human capital management, AI, and cybersecurity, are under consideration or have been adopted.
There can be no assurance, however, that consumers and advertisers will embrace our offerings, that subscribers will activate or renew a subscription, particularly given the significant number of streaming services in the marketplace, or that our DTC business will be as successful or as profitable as our traditional linear television business.
There can be no assurance, however, that consumers and advertisers will embrace our offerings, that subscribers will activate or renew a subscription, particularly given the significant number of streaming services in the marketplace, or that our DTC business or other strategies we implement will be as successful or as profitable as our traditional linear television business.
If the film industry and exhibitors are unable to successfully create and market “event” films and ultimately evolve and enhance the movie theater experience in response to shifting consumer preferences, the profitability, financial condition and results of operations of our studios business may be negatively impacted.
If the film industry (of which we are a part) and exhibitors are unable to successfully create and market “event” films and ultimately evolve and enhance the movie theater experience in response to shifting consumer preferences, the profitability, financial condition and results of operations of our studios business may be negatively impacted.
Providers of debt and equity financing may also consider our performance in these areas and the ratings of external firms (which we have limited ability to influence) in their decisions involving our Company, which could impact our cost of capital and adversely affect our business. Foreign exchange rate fluctuations may adversely affect our operating results and financial conditions.
Providers of debt and equity financing may also consider our position on these issues and the ratings of external firms (which we have limited ability to influence) in their decisions involving the Company, which could impact our cost of capital and adversely affect our business. Foreign exchange rate fluctuations may adversely affect our operating results and financial conditions.
Our competitors may also consolidate or enter into business combinations or alliances that strengthen their competitive positions. Our ability to compete successfully depends on a number of factors, including our ability to consistently acquire and produce high quality content amidst a rapidly evolving competitive landscape.
Our competitors may also consolidate or enter into business combinations or alliances that strengthen their competitive positions. Our ability to compete successfully depends on a number of factors, including our ability to consistently acquire and produce high quality content and our ability to identify and successfully execute strategies and partnerships to distribute our content amidst a rapidly evolving competitive landscape.
There can be no assurance that we will not be subject to liabilities in the future due to the foregoing or other circumstances that may arise in connection with these plans or that we can adequately mitigate these costs, any of which could materially adversely affect our business, financial condition and results of operations.
There can be no assurance that we will not be subject to liabilities in the future due to the foregoing or other circumstances that may arise in connection with these plans or that we can adequately mitigate these costs, any of which could materially adversely affect our business, financial condition and results of operations. ITEM 1B. Unresolved Staff Comments. None.
In addition, as a result of our significant indebtedness, our corporate or debt-specific credit rating could be downgraded, which may increase our borrowing costs or subject us to even more restrictive covenants when we incur new debt in the future, which could reduce profitability and diminish operational flexibility.
In addition, our corporate or debt-specific credit rating could be downgraded, which may increase our borrowing costs or subject us to even more restrictive covenants when we incur new debt in the future, which could reduce profitability and diminish operational flexibility.
Strategic transactions and acquisitions present many risks and we may not realize the financial and strategic goals that were contemplated at the time of any transaction. From time to time we may enter into strategic transactions, make investments or make acquisitions, such as the Merger.
Corporate restructurings, strategic transactions and acquisitions present many risks and we may not realize the financial and strategic goals that were contemplated at the time of any transaction. From time to time we may enter into strategic transactions, make investments or make acquisitions.
In addition, our insurance may not be adequate to protect us from all significant expenses related to pending and future claims and our current levels of insurance may not be available in the future at commercially reasonable prices. Any of these factors could adversely affect our business, financial condition and results of operations. 26 ITEM 1B. Unresolved Staff Comments. None.
In addition, our insurance may not be adequate to protect us from all significant expenses related to pending and future claims and our current levels of insurance may not be available in the future at commercially reasonable prices. Any of these factors could adversely affect our business, financial condition and results of operations.
Likewise, those persons who serve in similar capacities at Advance/Newhouse or a Liberty Entity have fiduciary duties to those companies.
Likewise, those persons who serve in similar capacities at a Liberty Entity have fiduciary duties to those companies.
For example, AI is a new technology for which the advantages and risks associated with its use in such industries are currently largely uncertain and unregulated.
For example, AI is a new technology for which the advantages and risks associated with its use in our industry are currently largely uncertain and unregulated.
If, as a result of their assessment of our performance on environmental, social, and governance matters, certain investors are unsatisfied with our actions or progress, they may reconsider their investment in our Company.
If, as a result of their assessment of our position on environmental, social, and governance matters, certain investors are unsatisfied with our actions, they may reconsider their investment in the Company.
As a response to changing consumer preferences and to return theater attendance towards pre-pandemic levels, film studios such as ours can seek to invest in creating compelling films and seek to promote events in connection with feature films in order to enhance the consumer’s movie theater experience.
As a response to changing consumer preferences, film studios such as ours can seek to invest in creating compelling films and seek to promote events in connection with feature films in order to enhance the consumer’s movie theater experience.
We are subject to domestic and international laws associated with the acquisition, storage, disclosure, use and protection of personal data, including under the E.U. General Data Protection Regulation, several U.S. federal and state privacy laws, including, but not limited to, the CCPA, and many other international laws and regulations.
We are subject to domestic and international laws associated with the acquisition, storage, disclosure, use and protection of personal data, including under the European General Data Protection Regulation, more than a dozen U.S. federal and state privacy laws, including, but not limited to, the CCPA, and many other international laws and regulations.
Many such laws, including new greenhouse gas emission regulations that have already been adopted in the State of California and in the European Union and have been proposed in other jurisdictions, include specific, quantitative disclosures regarding our global operations, both upstream and downstream.
Many such laws, including the European Union’s Corporate Sustainability Reporting Directive and the greenhouse gas emission regulations that have already been adopted in the state of California and that have been proposed in other jurisdictions, include specific, quantitative disclosures regarding our global operations, both upstream and downstream.
We and our partners rely on various technology systems in connection with the production, distribution and broadcast of our programming, and our online, mobile and app offerings, as well as our internal systems, involve the storage and transmission of personal and proprietary information.
We and our partners rely on various technology systems, including cloud services, content delivery, and other networks, in connection with the production, distribution and broadcast of our programming, and our online, mobile and app offerings, as well as our internal systems, involve the storage and transmission of personal and proprietary information.
If we were to disagree with one of the counterparties on the interpretation of a content distribution and license agreement, it could damage our relationship with that counterparty as well as materially adversely impact our business, financial condition and results of operations.
If we were to disagree with one of the counterparties on the interpretation of a content distribution and license agreement, it could damage our relationship with that counterparty as well as materially adversely impact our business, financial condition and results of operations. We rely on platforms owned by our competitors for digital and linear distribution of our content .
As noted above, these provisions apply even if the offer may be considered beneficial by some stockholders and could delay or prevent an acquisition that our board of directors determines is not in our best interests and the best interests of our stockholders.
These provisions are not intended to make us immune from takeovers. As noted above, these provisions apply even if the offer may be considered beneficial by some stockholders and could delay or prevent an acquisition that our board of directors determines is not in our best interests and the best interests of our stockholders.
We need to invest substantial amounts in the production or acquisition and marketing of our television programs, feature films, sports and news content before we learn whether such content will reach anticipated levels of popularity with consumers.
We are required to make substantial investments in the production or acquisition and marketing of our television programs, feature films, sports and news content before we learn whether such content will reach anticipated levels of popularity with consumers.
Risks Related to Our Business and Industry Our businesses operate in highly competitive industries and if we are unable to compete effectively, our business, financial condition and results of operations could suffer. The media and entertainment industries in which we compete for viewers, distribution and advertising are highly competitive.
Risks Related to Our Business and Industry Our businesses operate in highly competitive industries and if we are unable to compete effectively, our business, financial condition and results of operations could suffer. The media and entertainment industries in which we compete for viewers, distribution and advertising are highly competitive. See the discussion under “Business – Competition” that appears above.
We have recognized, and could continue to recognize, impairment charges related to goodwill and other intangible assets . We have a significant amount of goodwill and other intangible assets on our consolidated balance sheet. In accordance with U.S. GAAP, management periodically assesses these assets to determine if they are impaired.
We have recognized, and could continue to recognize, impairment charges related to goodwill and other intangible assets . We have a significant amount of goodwill and other intangible assets on our consolidated balance sheets. In accordance with U.S. generally accepted accounting principles (“U.S. GAAP”), management periodically assesses these assets to determine if they are impaired.
We have no rights in respect of U.S. or international content opportunities developed by or presented to the subsidiaries of any Liberty Entities, and the pursuit of these opportunities by such subsidiaries may adversely affect our interests and those of our stockholders. None of the Liberty Entities own any interest in us. Dr.
We have no rights in respect of U.S. or international content opportunities developed by or presented to any of the Liberty Entities or their respective subsidiaries, and the pursuit of these opportunities by any of the Liberty Entities or their respective subsidiaries may adversely affect our interests and those of our stockholders.
Theft of our intellectual property and unauthorized duplication, distribution and exhibitions of our intellectual property may decrease revenues and adversely affect our business, financial condition, and results of operations.
General Risks Theft of our intellectual property, unauthorized duplication, distribution and exhibitions of our intellectual property, and other impairments of our intellectual property rights may decrease revenues and adversely affect our business, financial condition, and results of operations.
Those same parties may also attempt to fraudulently induce employees, customers, or other users of our systems to disclose sensitive information in order to gain access to our data systems or that of our service providers, customers or clients through social engineering, phishing, mobile phone malware, account takeovers, SIM card swapping, or similar methods.
Malicious actors have attempted to, and may continue to attempt to, fraudulently induce employees, customers, or other users of our systems to disclose sensitive information in order to gain access to our data systems or that of our service providers, customers or clients through social engineering, phishing, mobile phone malware, account takeovers, SIM card swapping, or similar methods.
These factors include, without limitation: • actual or anticipated variations in our financial and operating results; • changes in our estimates, guidance or business plans; • variations between our actual results and expectations of securities analysts, or changes in financial estimates and recommendations by securities analysts; • market sentiment about our industry in general or our business in particular, including our level of debt, our leverage ratio, and our ability to effectively compete in the categories and industries in which we operate; • the activities, operating results or stock price of our competitors, or other industry participants; • spending on domestic and foreign television and digital advertising; 25 • the announcement or completion of significant transactions by us or a competitor; • overall general market fluctuations and other events affecting the stock market generally; and • the economic and political conditions in the U.S. and internationally, as well as other factors described in this Item 1A.
These factors include, without limitation: • actual or anticipated variations in our financial and operating results; • changes in our estimates, guidance or business plans; • variations between our actual results and expectations of securities analysts, or changes in financial estimates and recommendations by securities analysts; • market sentiment about our industry in general or our business in particular, including our level of debt, our leverage ratio, credit ratings, and our ability to effectively compete in the categories and industries in which we operate; • sales of our stock in the public market by our stockholders, some of whom, together with their affiliates, hold large amounts of our stock; • the activities, operating results or stock price of our competitors, or other industry participants; • spending on domestic and foreign television and digital advertising; • the announcement or completion of significant transactions by us or a competitor; • overall general market fluctuations and other events affecting the stock market generally; and • the economic and political conditions in the U.S. and internationally, as well as other factors described in this Item 1A. 26 Some of these factors may adversely impact the price of our common stock, regardless of our operating performance.
Our consolidated indebtedness as of December 31, 2023 was $41,889 million, of which $1,780 million is current. In addition, we have the ability to draw down on a $6.0 billion revolving credit facility in the ordinary course, which would have the effect of further increasing our debt to the extent drawn.
Our consolidated indebtedness as of December 31, 2024 was $39,505 million, of which $2,748 million is current. In addition, we have the ability to draw down on a $6.0 billion revolving credit facility in the ordinary course, which would have the effect of further increasing our debt to the extent drawn.
If our or our service providers’ information security systems or data are compromised, such compromises could result in a disruption of services or a reduction of the revenues we are able to generate from such services, damage to our brands and reputation, a loss of confidence in the security of our offerings and services, and significant legal, regulatory and financial exposure, each of which could potentially have an adverse effect on our business.
If our or our service providers’ information security systems or data are compromised, such compromises could result in a disruption of services or a reduction of the revenues we are able to generate from such services, damage to our brands and reputation, a loss of confidence in the security of our offerings and services, and significant legal, regulatory and financial exposure, each of which could potentially have an adverse effect on our business. 25 Our business, financial condition and results of operations may be negatively impacted by the outcome of uncertainties related to litigation.
The respective parent companies of Advance/Newhouse and of Liberty Media, Liberty Global, Qurate Retail, Liberty Broadband, and LLA (together, the “Liberty Entities”) own interests in various U.S. and international media, communications and entertainment companies, such as Charter, that have subsidiaries that own or operate domestic or foreign content services that may compete with the content services we offer.
Liberty Media, Liberty Global, Qurate Retail, and Liberty Broadband, LLA (together, the “Liberty Entities”) own interests in various U.S. and international media, communications and entertainment companies, such as Charter Communications, Inc., that directly or indirectly own or operate domestic or foreign content services that may compete with the content services we offer.
Our participation in multiemployer defined benefit pension plans could subject us to liabilities that could adversely affect our business, financial condition and results of operations. We contribute to various multiemployer defined benefit pension plans (the “multiemployer plans”) under the terms of collective bargaining agreements that cover certain of our union-represented employees which could subject us to liabilities in certain circumstances.
We contribute to various multiemployer defined benefit pension plans (the “multiemployer plans”) under the terms of collective bargaining agreements that cover certain of our union-represented employees which could subject us to liabilities in certain circumstances.
These obligations and regulations, among other things, require closed captioning of programming for the hearing impaired, require certain content providers to make available audio descriptions of programming for the visually impaired, limit the amount and content of commercial matter that may be shown during programming aimed primarily at an audience of children aged 12 and under, and require the identification of (or the maintenance of lists of) sponsors of political advertising.
Current obligations and regulations, among other things, require closed captioning of programming for the hearing impaired, require certain content providers to make available audio descriptions of programming for the visually impaired, impose other accessibility requirements, and limit the amount and content of commercial matter that may be shown during programming aimed primarily at an audience of children aged 12 and under.
Our business is significantly affected by prevailing economic conditions and levels of consumer discretionary spending. A downturn in global economic conditions may negatively affect our current and potential customers, particularly advertisers whose expenditures are sensitive to general economic conditions, vendors and others with whom we do business and their ability to satisfy their obligations to us.
A downturn in global economic conditions may negatively affect our current and potential customers, particularly advertisers whose expenditures are sensitive to general economic conditions, vendors and others with whom we do business and their ability to satisfy their obligations to us.
Bribery Act that impose stringent requirements on how we conduct our foreign operations and changes in these laws and regulations; • sanction laws and regulations such as those administered by the Office of Foreign Assets Control that restrict our dealings with certain sanctioned countries, territories, individuals and entities; these laws and regulations are complex, frequently changing, and increasing in number, and may impose additional prohibitions or compliance obligations on our dealings in certain countries and territories, including sanctions imposed on Russia and certain Ukrainian territories as well as sanctions imposed on China; • challenges implementing effective controls to monitor business activities across our expanded international operations; • foreign privacy and data protection laws and regulations and changes in these laws and regulations; and • shifting consumer preferences regarding the viewing of video programming and consumption of entertainment content overall.
Bribery Act that impose stringent requirements on how we conduct our foreign operations and changes in these laws and regulations; • sanction laws and regulations such as those administered by the Office of Foreign Assets Control that restrict our dealings with certain sanctioned countries, territories, individuals and entities; these laws and regulations are complex, frequently changing, and increasing in number, and may impose additional prohibitions or compliance obligations on our dealings in certain countries and territories, including sanctions imposed on Russia and certain Ukrainian territories as well as sanctions imposed on China; • challenges implementing effective controls to monitor business activities across our expanded international operations; 21 • restrictions on transfers of personal data under foreign privacy and data protection laws and U.S. national security regulations, including the Preventing Access to U.S.
Even if we ultimately prevail in a lawsuit or dispute, defending against the claim or resolving the dispute could be time-consuming and costly and divert our management’s attention and resources away from our business, which could negatively and materially impact our business, financial condition and results of operations. 18 Risks Related to Domestic and Foreign Laws and Regulations; Other Risks Related to International Operations Changes in domestic and foreign laws and regulations and other risks related to international operations could adversely impact our business, financial condition and results of operations.
Even if we ultimately prevail in a lawsuit or dispute, defending against the claim or resolving the dispute could be time-consuming and costly and divert our management’s attention and resources away from our business, which could negatively and materially impact our business, financial condition and results of operations.
If we fail to retain or attract key individuals or if our talent loses their current audience base or suffer negative publicity, our business, financial condition and results of operations could be materially adversely affected. Global economic conditions and other global events may have an adverse effect on our business.
If we fail to retain or attract key individuals or if our talent loses their current audience base or suffer negative publicity, our business, financial condition and results of operations could be materially adversely affected.
The impact of these strike-related delays and other consequences of these strikes have continued, and are expected to continue to, impact our business even after the strikes were ultimately resolved. 16 If the media and entertainment industries experience prolonged strikes, work slowdowns or work stoppages, we may be unable to produce, distribute or license programming, feature films, and interactive entertainment, which could result in reduced revenue and have a material adverse effect on our business, financial condition and results of operations.
If the media and entertainment industries experience prolonged strikes, work slowdowns or work stoppages, we may be unable to produce, distribute or license programming, feature films, and interactive entertainment, which could result in reduced revenue and have a material adverse effect on our business, financial condition and results of operations.
In addition, we distribute programming outside the U.S. As a result, our business is, and may increasingly be, subject to certain risks inherent in international business, many of which are beyond our control.
Additionally, certain Executive Orders from the U.S. government could affect our business, operations, strategies, and increase our costs of compliance. In addition, we distribute programming outside the U.S. As a result, our business is, and may increasingly be, subject to certain risks inherent in international business, many of which are beyond our control.
These recommendations include, among other things, profit reallocation rules and a 15% global minimum corporate income tax rate. Certain countries in which we operate have adopted legislation, and other countries are expected to introduce legislation, to implement these recommendations. The application of this legislation is evolving, and we continue to assess the potential impact on our future tax liability.
Certain countries in which we operate have adopted legislation, and other countries are expected to introduce legislation, to implement these recommendations. The application of this legislation is evolving, and we continue to assess the potential impact on our future tax liability.
We have been engaged in legal proceedings and disputes related to the Merger and could be subject to additional legal proceedings and disputes related to the Merger, the outcomes of which are uncertain and could negatively impact our business, financial condition and results of operations.
All of these factors could materially adversely affect our stock price, business, financial condition, results of operations or cash flows. 23 We have been engaged in legal proceedings and disputes related to the Merger and could be subject to additional legal proceedings and disputes related to the Merger, the outcomes of which are uncertain and could negatively impact our business, financial condition and results of operations.
We may be subject to a number of lawsuits both in the U.S. and in foreign countries, including, at any particular time, claims relating to antitrust, intellectual property, employment, wage and hour, consumer privacy, regulatory and tax proceedings, contractual and commercial disputes, and the production, distribution, and licensing of our content.
From time to time, we are subject to a number of legal claims, regulatory investigations, litigation actions (asserted individually and/or on behalf of a class), and/or arbitration proceedings, both in the U.S. and in foreign countries, including, at any particular time, claims relating to antitrust, intellectual property, employment, wage and hour, consumer privacy, regulatory and tax proceedings, contractual and commercial disputes, and the production, distribution, and licensing of our content.
Risk Factors, our ability to generate advertising revenue is also dependent on our ability to compete in highly competitive, rapidly evolving industries, our ability to respond to changes in consumer behavior and our ability to consistently achieve audience acceptance of our content and brands. 13 Changes in consumer behavior, as well as evolving technologies and distribution models, may negatively affect our business, financial condition or results of operations.
Risk Factors, our ability to generate advertising revenue is also dependent on our ability to compete in highly competitive, rapidly evolving industries, our ability to respond to changes in consumer behavior and our ability to consistently achieve audience acceptance of our content and brands.
Our consolidated financial statements are denominated in U.S. dollars, and to prepare those financial statements we must translate the amounts of the assets, liabilities, net sales, other revenues and expenses of our operations outside of the U.S. from local currencies into U.S. dollars using exchange rates for the current period.
Where appropriate, we manage our exposure to foreign currency risk by entering into derivative instruments with counterparty banks, which exposes us to counterparty credit risk. 22 Our consolidated financial statements are denominated in U.S. dollars, and to prepare those financial statements we must translate the amounts of the assets, liabilities, net sales, other revenues and expenses of our operations outside of the U.S. from local currencies into U.S. dollars using exchange rates for the current period.
Our other directors who are also directors of the Liberty Entities hold stock and stock-based compensation in the Liberty Entities and hold our stock and stock-based compensation. 22 These ownership interests and/or business positions could create conflicts of interest or the appearance of conflicts of interest when these individuals are faced with decisions that could have different implications for us, Advance/Newhouse and/or the Liberty Entities.
These ownership interests and/or business positions could create conflicts of interest or the appearance of conflicts of interest when these individuals are faced with decisions that could have different implications for us and/or one or more of the Liberty Entities.
For example, in certain countries, including China, laws and regulations limit the number of foreign films exhibited in such countries in a calendar year. 24 From time to time, third parties may also challenge the validity or scope of our intellectual property and may assert infringement claims against us, and the success of any such challenges could result in the limitation or loss of intellectual property rights.
Further, from time to time, third parties may also challenge the validity or scope of our intellectual property and may assert infringement claims against us, and the success of any such challenges could result in the limitation or loss of intellectual property rights.
If we are not successful in maintaining existing or creating new relationships with these third parties, our ability to retain subscribers and grow our business could be adversely impacted. Service disruptions or the failure of communications satellites or transmitter facilities we rely upon could adversely impact our business, financial condition and results of operations.
If we are not successful in maintaining existing or creating new relationships with these third parties, our ability to retain subscribers and grow our business could be adversely impacted.
As a global company, we are subject to laws in the U.S. and abroad, as well as trade agreements which may limit our ability to exploit our intellectual property.
As a global company, we are subject to laws in the U.S. and abroad, as well as trade agreements which may limit our ability to exploit our intellectual property. For example, in certain countries, including China, laws and regulations limit the number of foreign films exhibited in such countries in a calendar year.
Accordingly, it is expected that Section 203 will have an anti-takeover effect with respect to transactions that our board of directors does not approve in advance and that Section 203 may discourage takeover attempts that might result in a premium over the market price of WBD capital stock.
Accordingly, it is expected that Section 203 will have an anti-takeover effect with respect to transactions that our board of directors does not approve in advance and that Section 203 may discourage takeover attempts that might result in a premium over the market price of WBD capital stock. 20 These provisions are intended to protect our stockholders from coercive or otherwise unfair takeover tactics by requiring potential acquirers to negotiate with our board of directors and by providing our board of directors with more time to assess any acquisition proposal.
We have directors that are also related persons of Advance/Newhouse Programming Partnership (“Advance/Newhouse”) and that overlap with those of Liberty Media Corporation (“Liberty Media”), Liberty Global plc (“Liberty Global”), Qurate Retail Group f/k/a Liberty Interactive Corporation (“Qurate Retail”), Liberty Broadband Corporation (“Liberty Broadband”), and Liberty Latin America Ltd (“LLA”), which may lead to conflicting interests for those directors or result in the diversion of business opportunities or other potential conflicts.
(“Liberty Global”), Qurate Retail, Inc. f/k/a Liberty Interactive Corporation (“Qurate Retail”), Liberty Broadband Corporation (“Liberty Broadband”), and Liberty Latin America Ltd. (“LLA”), which may lead to conflicting interests for those directors or result in the diversion of business opportunities or other potential conflicts. Dr. John C.
Other changes in tax laws and the interpretations thereof could have a material impact on our tax liability. In addition, many foreign jurisdictions have increased scrutiny and have either changed, or plan to change, their international tax systems due to the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting recommendations.
In addition, many foreign jurisdictions have increased scrutiny and have either changed, or plan to change, their international tax systems due to the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting recommendations. These recommendations include, among other things, profit reallocation rules and a 15% global minimum corporate income tax rate.
If our distributors have to pay higher rates to other holders of sports broadcasting rights, it might be difficult for us to negotiate higher rates for the distribution of our networks.
If our distributors have to pay higher rates to other holders of sports broadcasting rights, it might be difficult for us to negotiate higher rates for the distribution of our networks. This difficulty could be amplified if we are unable to obtain or maintain licenses for sports programming that we can bundle with our other programming for distribution.
For example, the 2023 WGA and SAG-AFTRA strikes caused delays in the production of our television programs and feature films and in the release of certain programming.
For example, the 2023 WGA and SAG-AFTRA strikes caused delays in the production of our television programs and feature films and in the release of certain programming. The impact of these strike-related delays and other consequences of these strikes have continued to impact our business even after the strikes were ultimately resolved.
In addition, we believe our relationship with our third-party partners is an important factor in the success of any joint venture or partnership. If a partner changes, our relationship may be adversely affected and we may not realize the anticipated benefits from such joint venture or partnership.
In addition, we believe our relationship with our third-party partners is an important factor in the success of any joint venture or partnership.
We have implemented processes, strategies and incident response plans designed to identify, assess and manage cyber risks and information security vulnerabilities (as further described in Item 1C. Cybersecurity). However, our procedures may not be sufficient to adequately mitigate the negative impacts of a cyber breach or adverse event.
We have implemented processes, strategies and incident response plans designed to identify, assess and manage cyber risks and information security vulnerabilities (as further described in Item 1C. Cybersecurity).
Our success with sports programming is highly dependent on consumer acceptance of this content and the size of our viewing audience. If viewers do not find our sports programming content acceptable, we could see low viewership, which could lead to low distribution and advertising revenues and adversely affect our business, financial condition and results of operations.
If viewers do not find our sports programming content acceptable, we could see low viewership, which could lead to low distribution and advertising revenues and adversely affect our business, financial condition and results of operations. 16 Our businesses have been, and in the future may be, subject to labor disruption.
Additional lawsuits relating to the Merger, or disputes arising out of definitive agreements entered into in connection with the Merger, could arise in the future. The outcomes of Merger-related lawsuits and disputes are uncertain and could negatively and materially impact our business, financial condition and results of operations.
The outcomes of Merger-related lawsuits and disputes are uncertain and could negatively and materially impact our business, financial condition and results of operations.
These systems may continue to be breached in the future due to employee error or misconduct, system vulnerabilities, malicious code, hacking and phishing attacks, or otherwise. The risk of cyberattacks may continue to increase as technologies evolve and cyber criminals conduct their attacks using more sophisticated methods, including those which use AI.
The risk of cyberattacks may continue to increase as technologies evolve and cyber criminals conduct their attacks using more sophisticated methods, including those which use AI. We may be unable to anticipate these methods and implement adequate preventative measures.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur Chief Financial Officer, our Chief Legal Officer, our Chief Audit and Risk Officer and our Chief Information Officer also have input and involvement in our cybersecurity program. Our Board of Directors has an active role, as a whole and at the committee level, in overseeing the Company’s overall risk management, including cybersecurity risks.
Biggest changeOur board of directors has an active role, as a whole and at the committee level, in overseeing the Company’s overall risk management, including cybersecurity risks. Our board of directors has delegated responsibility for cybersecurity and information technology risks to our Audit Committee and is regularly informed about such risks through committee reports and other presentations.
Our Chief Information Security Officer (“CISO”) is responsible for cybersecurity risk oversight and oversees a global organization whose responsibilities include proactively managing and monitoring information and content security, cybersecurity risk, and processes to enable secure and resilient access to, and use of, WBD products and services.
Our Chief Information Security Officer (“CISO”) is responsible for the management of such risks and oversees a global organization whose responsibilities include proactively managing and monitoring information and content security, cybersecurity risk, and processes to enable secure and resilient access to, and use of, WBD products and services.
See Item 1A, “Risk Factors” for details on the risks from cybersecurity threats that we face. 27 Our CISO has over 30 years of expertise in global digital and information security, cybersecurity risk management, data privacy and compliance across diverse industries including media and entertainment, biotechnology, pharmaceuticals, financial services, and government defense sectors and holds multiple industry-recognized certifications including, among others, a Certificate of Cybersecurity Oversight from the National Association of Corporate Directors and a Certified Information Systems Security Professional certification.
Our CISO has over 30 years of expertise in global digital and information security, cybersecurity risk management, data privacy and compliance across diverse industries including media and entertainment, biotechnology, pharmaceuticals, financial services, and government defense sectors and holds multiple industry-recognized certifications including, among others, a Certificate of Cybersecurity Oversight from the National Association of Corporate Directors and a Certified Information Systems Security Professional certification.
Our multi-layered technical defense involves a series of protective measures across various levels of our technology environment. This includes fortifying our network perimeter through intrusion detection and prevention systems, securing individual devices with antivirus solutions and endpoint detection, implementing network security measures, and ensuring the resilience of applications.
This includes fortifying our network perimeter through intrusion detection and prevention systems, securing individual devices with antivirus solutions and endpoint detection, implementing network security measures, and ensuring the resilience of applications.
We have a Cybersecurity Incident Response Plan that establishes procedures, roles, responsibilities, and communication protocols for WBD executive management and technical staff in the event of a cybersecurity incident. We test the efficacy of the Cybersecurity Incident Response Plan and assess our response capabilities by conducting annual tabletop exercises that simulate cybersecurity threat scenarios.
We have a Cybersecurity Incident Response Plan that establishes procedures, roles, responsibilities, and communication protocols for WBD executive management and technical staff in the event of a cybersecurity incident.
ITEM 1C. Cybersecurity. We have a cybersecurity program to assess and manage risks to the confidentiality, integrity, and availability of our data, networks and technology assets across WBD.
ITEM 1C. Cybersecurity. We have a cybersecurity program to assess and manage risks to the confidentiality, integrity, and availability of our data, networks and technology assets across WBD. Our board of directors oversees risk management at WBD and has delegated functional oversight of cybersecurity and information technology risks to the Audit Committee.
Governance We have established a cybersecurity governance structure to engage appropriate stakeholders. Our CISO is informed about and monitors our prevention, detection, mitigation and remediation efforts related to cyber threats through regular communication and reporting from our information security team.
Our CISO is informed about and monitors our prevention, detection, mitigation and remediation efforts related to cyber threats through regular communication and reporting from our information security team. Our Chief Financial Officer, our Chief Legal Officer, our Chief Audit and Risk Officer and our Chief Information Officer also have input and involvement in our cybersecurity program.
We have ongoing processes to identify and assess cybersecurity risks associated with current and prospective third-party service providers. These processes include a vendor cybersecurity compliance assessment at the time of onboarding, contract renewal and/or as needed in the event of a cybersecurity incident affecting such third-party vendor.
These processes include a vendor cybersecurity compliance assessment at the time of onboarding, contract renewal and/or as needed in the event of a cybersecurity incident affecting such third-party vendor. In addition, we require our providers to meet appropriate security requirements, controls and responsibilities and notify us in the event of a cybersecurity incident that impacts us.
In addition, we require our providers to meet appropriate security requirements, controls and responsibilities and notify us in the event of a cybersecurity incident that impacts us. We have established cybersecurity information sharing and collaboration practices with both government agencies and industry partners, which we believe enhances our overall cybersecurity resilience.
We have established cybersecurity information sharing and collaboration practices with both government agencies and industry partners, which we believe enhances our overall cybersecurity resilience. Governance We have established a cybersecurity governance structure to engage appropriate stakeholders.
Our Board of Directors has delegated responsibility for cybersecurity and information technology risks to our Audit Committee and is regularly informed about such risks through committee reports and other presentations. Our Audit Committee regularly reviews and discusses our cybersecurity risks and is updated by our CISO on how we identify, assess and mitigate those risks.
Our Audit Committee regularly reviews and discusses our cybersecurity risks and is updated quarterly by our CISO on how we identify, assess and mitigate those risks.
Since the closing of the Merger in 2022, we have continued to strengthen and enhance our cybersecurity program and integrate it into our overall risk management processes. Risk Management and Strategy We have a cybersecurity risk management strategy for safeguarding our digital assets that includes both technical and non-technical cybersecurity controls.
Our cybersecurity risk management processes are aligned and integrated into our overall enterprise risk management approach. Risk Management and Strategy We have a cybersecurity risk management strategy for safeguarding our digital assets that includes both technical and non-technical cybersecurity controls. Our multi-layered technical defense involves a series of protective measures across various levels of our technology environment.
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We test the efficacy of the Cybersecurity Incident Response Plan and assess our response capabilities by conducting annual tabletop exercises that simulate cybersecurity threat scenarios. 27 We have ongoing processes to identify and assess cybersecurity risks associated with current and prospective third-party service providers.
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We periodically experience cybersecurity incidents, but, as of December 31, 2024, we are not aware of any such incidents that have materially impacted or are reasonably likely to materially impact our business, financial condition or results of operations.
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However, despite our efforts, we cannot eliminate all risks from cybersecurity threats or provide assurances that we have not experienced undetected cybersecurity incidents or will not discover additional information about previously detected events. See Item 1A, “Risk Factors” for details on the risks from cybersecurity threats that we face.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLondon, UK Chiswick Park, Bldg. 2 Studios, Networks, DTC, and Corporate 115,000 Leased; expires in 2034. Seattle, WA 1099 Stewart Street DTC 112,000 Leased; expires in 2025. Washington, DC 820 First Street Studios and Networks 109,000 Leased; expires in 2031. Richmond, Canada 13480 Crestwood Place Studios 108,000 Leased; expires in 2030.
Biggest changeRichmond, Canada 13480 Crestwood Place Studios 114,000 Leased; expires in 2030. Seattle, WA 1099 Stewart Street DTC 112,000 Leased; expires in 2025. Hyderabad, India Block A, International Tech Park Corp. 110,000 Leased; expires in 2028. Washington, DC 820 First Street Studios and Networks 109,000 Leased; expires in 2031. Mexico City, Mexico Paseo de las Palmas, 425 Col.
The following table sets forth information as of December 31, 2023 with respect to the Company’s principal properties: Location Principal Use Approximate Square Footage Type of Ownership; Expiration Date of Lease Burbank, CA 4000 Warner Blvd. Studios 2,600,000 Owned. New York, NY 30 Hudson Yards Studios, Networks, DTC, and Corporate 1,500,000 Leased; expires in 2034.
The following table sets forth information as of December 31, 2024 with respect to the Company’s principal properties: Location Principal Use Approximate Square Footage Type of Ownership; Expiration Date of Lease Burbank, CA 4000 Warner Blvd. Studios 2,600,000 Owned. New York, NY 30 Hudson Yards Studios, Networks, DTC, and Corporate 1,500,000 Leased; expires in 2034.
ITEM 2. Properties. The Company’s headquarters are located in New York City at 230 Park Ave. South. The Company owns and leases approximately 23 million square feet of offices; studios; technical, production and warehouse spaces; and other properties in numerous locations in the U.S. and around the world for its businesses.
ITEM 2. Properties. The Company’s headquarters are located in New York City at 230 Park Ave. South. The Company owns and leases approximately 17 million square feet of offices; studios; technical, production and warehouse spaces; and other properties in numerous locations in the U.S. and around the world for its businesses.
Radlett, UK Ventura Park, Old Parkbury Lane Studios 198,000 Leased; expires in 2028 and 2034. Atlanta, GA 3700 Atlanta Industrial Pkwy. Studios 177,000 Leased; expires in 2024. Krakow, Poland Plk. Dadka 2 Studios and Networks 151,000 Leased; expires in 2026.
Cardington, Bedfordshire, UK Cardington Airfield, Shed 1 Studios 220,000 Leased; expires in 2027. Radlett, UK Ventura Park, Old Parkbury Lane Studios 198,000 Leased; expires in 2028 and 2034. Atlanta, GA 3700 Atlanta Industrial Pkwy. Studios 177,000 Leased; expires in 2025. Krakow, Poland Plk. Dadka 2 Studios and Networks 151,000 Leased; expires in 2026.
New York, NY 230 Park Ave. South Headquarters, Studios, Networks, DTC, and Corporate 360,000 Leased; expires in 2037. Warsaw, Poland Wiertnicza 166 Studios, Networks, DTC, and Corporate 247,000 Owned. Culver City, CA 8900 Venice Boulevard Networks and DTC 244,000 Leased; expires in 2036. Cardington, Bedfordshire, UK Cardington Airfield, Shed 1 Studios 220,000 Leased; expires in 2027.
Burbank, CA 3000 West Alameda Avenue Studios 460,000 Leased; expires in 2027. New York, NY 230 Park Ave. South Headquarters, Studios, Networks, DTC, and Corporate 360,000 Leased; expires in 2037. Warsaw, Poland Wiertnicza 166 Studios, Networks, DTC, and Corporate 335,000 Owned. Culver City, CA 8900 Venice Boulevard Networks and DTC 244,000 Leased; expires in 2036.
Hyderabad, India Block A, International Tech Park Corporate 89,000 Leased; expires in 2028. Paris, France L’Amiral, ZAC Forum Seine Networks, DTC, and Corporate 81,000 Leased; expires in 2031. Auckland, New Zealand 2 and 3 Flower Street Studios, Networks, DTC, and Corporate 57,000 Leased; expires in 2025. Sterling, VA 45580 Terminal Drive Studios, Networks, DTC, and Corporate 54,000 Owned.
Lomas de Chapultepec Corp. 85,000 Leased; expires in 2029 Paris, France L’Amiral, ZAC Forum Seine Networks, DTC, and Corporate 81,000 Leased; expires in 2031. Auckland, New Zealand 2 and 3 Flower Street Studios, Networks, DTC, and Corporate 57,000 Leased; expires in 2025. Sterling, VA 45580 Terminal Drive Studios, Networks, DTC, and Corporate 54,000 Owned.
Leavesden, UK Warner Drive (Studios); Studio Tour Drive (Studio Tour); 5 and 6 Hercules Way (Leavesden Park) Studios 1,300,000 Owned. Atlanta, GA 1050 Techwood Drive Studios, Networks, DTC, and Corporate 1,170,000 Owned. Atlanta, GA One CNN Center Studios, Networks, and Corporate 1,150,000 Leased; expires in 2024. Burbank, CA 3000 West Alameda Avenue Studios 860,000 Owned.
Leavesden, UK Warner Drive (Studios); Studio Tour Drive (Studio Tour); 5 and 6 Hercules Way (Leavesden Park) Studios 1,300,000 Owned. Atlanta, GA 1050 Techwood Drive Studios, Networks, DTC, and Corporate 1,170,000 Owned.
London, England 98 Theobalds Road Networks, DTC, and Corporate 135,000 Leased; expires in 2034. 28 Location Principal Use Approximate Square Footage Type of Ownership; Expiration Date of Lease Buenos Aires, Argentina 599 and 533 Defensa Street Studios, Networks, DTC, and Corporate 129,000 Owned. London, UK 160 Old Street Studios, Networks, DTC, and Corporate 116,000 Leased; expires in 2034.
London, England 98 Theobalds Road Networks, DTC, and Corporate 135,000 Leased; expires in 2034. Buenos Aires, Argentina 599 and 533 Defensa Street Studios, Networks, DTC, and Corporate 129,000 Owned. London, UK 160 Old Street Studios, Networks, DTC, and Corporate 116,000 Leased; expires in 2034. London, UK Chiswick Park, Bldg. 2 Studios, Networks, DTC, and Corporate 115,000 Leased; expires in 2034.
Burbank, CA 100 and 200 South California Street Studios and Corporate 811,000 Leased; Tower 1 expires in 2037 and Tower 2 expires in 2039. Santiago, Chile Pedro Montt 2354 Studios and Networks 610,000 Owned. Tokyo, Japan 1-1625-1, Kasuga-cho, Nerima-ku Studios 527,000 Leased; expires in 2052. Atlanta, GA 3755 Atlanta Industrial Pkwy. Studios 409,000 Leased; expires in 2024.
Burbank, CA 100 and 200 South California Street Studios and Corporate 811,000 Leased; Tower 1 expires in 2037 and Tower 2 expires in 2039. 28 Location Principal Use Approximate Square Footage Type of Ownership; Expiration Date of Lease Santiago, Chile Pedro Montt 2354 Studios and Networks 610,000 Owned Tokyo, Japan 1-1625-1, Kasuga-cho, Nerima-ku Studios 531,000 Leased; expires in 2053.
Silver Spring, MD 8403 Colesville Road Networks and Corporate 47,000 Leased; expires in 2030. Many of the listed locations are occupied by multiple segments; the most critical (or the principal) occupiers are listed here.
Many of the listed locations are occupied by multiple segments; the most critical or the principal occupiers are listed here.
Added
Knoxville, TN 265 Brookview Center Way Networks and Corp. 53,000 Leased; expires in 2033. Bellevue, WA 225 108th Avenue NE DTC 48,000 Leased; expires in 2030. 29 Location Principal Use Approximate Square Footage Type of Ownership; Expiration Date of Lease Silver Spring, MD 8403 Colesville Road Networks and Corporate 47,000 Leased; expires in 2030.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeAlthough the outcome of these matters cannot be predicted with certainty and the impact of the final resolution of these matters on the Company’s results of operations in a particular subsequent reporting period is not known, management does not currently believe that the resolution of these matters will have a material adverse effect on the Company’s future consolidated financial position, future results of operations, or cash flows.
Biggest change(See Note 22 to the accompanying consolidated financial statements.) Although the outcome of these matters cannot be predicted with certainty and the impact of the final resolution of these matters on the Company’s results of operations in a particular subsequent reporting period is not known, management does not currently believe that the resolution of these matters will have a material adverse effect on the Company’s future consolidated financial position, future results of operations, or cash flows.
However, a determination as to the amount of the accrual required for such contingencies is highly subjective and requires judgment about future events. The Company may not currently be able to estimate the reasonably possible loss or range of loss for such matters until developments in such matters have provided sufficient information to support an assessment of such loss.
A determination as to the amount of the accrual required for such contingencies is highly subjective and requires judgment about future events. The Company may not currently be able to estimate the reasonably possible loss or range of loss for certain matters until developments in such matters have provided sufficient information to support an assessment of such loss.
The amended complaint asserted violations of Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as amended, and sought damages and other relief. On February 5, 2024, the court dismissed the amended complaint with prejudice.
The amended complaint asserted violations of Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as amended, and sought damages and other relief. On February 5, 2024, the court dismissed the amended complaint with prejudice. On March 4, 2024, plaintiffs filed an appeal.
Added
On November 1, 2024, the United States Court of Appeals for the Second Circuit affirmed the February 5, 2024 judgment.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeSims has served as our Chief Legal Officer since October 2023 and was previously Executive Vice President and General Counsel from the closing of the Merger on April 8, 2022 to October 2023. Prior to the closing, Ms. Sims served as Discovery’s Executive Vice President and General Counsel from April 2017 until April 2022. Prior to that, Ms.
Biggest changePrior to the closing, Mr. Wiedenfels served as Discovery’s Chief Financial Officer from April 2017 until April 2022. Priya Aiyar, Chief Legal Officer Age: 50 Executive Officer since 2025 Ms. Aiyar joined the Company as our Chief Legal Officer on February 24, 2025. Prior to joining the Company, Ms.
Zaslav served as Discovery’s President and Chief Executive Officer from January 2007 until April 2022 and a common stock director of Discovery from September 2008 until April 2022. Gunnar Wiedenfels, Chief Financial Officer Age: 46 Executive Officer since 2017 Mr. Wiedenfels has served as our Chief Financial Officer since the closing of the Merger on April 8, 2022.
Zaslav served as Discovery’s President and Chief Executive Officer from January 2007 until April 2022 and a common stock director of Discovery from September 2008 until April 2022. Gunnar Wiedenfels, Chief Financial Officer Age: 47 Executive Officer since 2017 Mr. Wiedenfels has served as our Chief Financial Officer since the closing of the Merger on April 8, 2022.
Prior to the closing, Mr. Zeiler served as President of WarnerMedia International from August 2020 to April 2022 and prior to that, Chief Revenue Officer of WarnerMedia from March 2019 to August 2020. Mr. Zeiler was President of Turner Broadcasting System International from May 2012 to February 2019. PART II
Zeiler served as President of WarnerMedia International from August 2020 to April 2022 and prior to that, Chief Revenue Officer of WarnerMedia from March 2019 to August 2020. Mr. Zeiler was President of Turner Broadcasting System International from May 2012 to February 2019. PART II
Lori Locke, Chief Accounting Officer Age: 60 Executive Officer since 2019 Ms. Locke has served as our Chief Accounting Officer since the closing of the Merger on April 8, 2022. Prior to the closing, Ms. Locke served as Discovery’s Chief Accounting Officer from June 2019 to April 2022. Prior to joining Discovery, Ms.
Lori Locke, Chief Accounting Officer Age: 61 Executive Officer since 2019 Ms. Locke has served as our Chief Accounting Officer since the closing of the Merger on April 8, 2022. Prior to the closing, Ms. Locke served as Discovery’s Chief Accounting Officer from June 2019 to April 2022.
ITEM 4. Mine Safety Disclosures. Not applicable. 29 Executive Officers of Warner Bros. Discovery, Inc. As of February 23, 2024, the following individuals are the executive officers of the Company. David M. Zaslav, President, Chief Executive Officer, and a director Age: 64 Executive Officer since 2007 Mr.
ITEM 4. Mine Safety Disclosures. Not applicable. 30 Executive Officers of Warner Bros. Discovery, Inc. As of February 27, 2025, the following individuals are the executive officers of the Company. David M. Zaslav, President, Chief Executive Officer, and a director Age: 65 Executive Officer since 2007 Mr.
Perrette has served as our CEO and President of Global Streaming and Games since the closing of the Merger on April 8, 2022.
Jean-Briac Perrette, CEO and President, Global Streaming and Games Age: 53 Executive Officer since 2014 Mr. Perrette has served as our CEO and President of Global Streaming and Games since the closing of the Merger on April 8, 2022.
Prior to the closing, Mr. Wiedenfels served as Discovery, Inc.’s Chief Financial Officer from April 2017 until April 2022. Bruce L. Campbell, Chief Revenue and Strategy Officer Age: 56 Executive Officer since 2008 Mr. Campbell has served as our Chief Revenue and Strategy Officer since the closing of the Merger on April 8, 2022.
Campbell, Chief Revenue and Strategy Officer Age: 57 Executive Officer since 2008 Mr. Campbell has served as our Chief Revenue and Strategy Officer since the closing of the Merger on April 8, 2022. Prior to the closing, he served as Discovery’s Chief Development, Distribution and Legal Officer. Mr.
Sims served as Discovery’s Executive Vice President and Deputy General Counsel from December 2014 to April 2017 and Discovery’s Senior Vice President, Litigation and Intellectual Property from August 2011 to December 2014. Gerhard Zeiler, President, International Age: 68 Executive Officer since 2022 Mr. Zeiler has served as our President, International since the closing of the Merger on April 8, 2022.
Remling served as Chief People Officer of WPP, a global advertising and marketing services company, from January 2016 to December 2023. 31 Gerhard Zeiler, President, International Age: 69 Executive Officer since 2022 Mr. Zeiler has served as our President, International since the closing of the Merger on April 8, 2022. Prior to the closing, Mr.
Adria Alpert Romm, Chief People and Culture Officer Age: 68 Executive Officer since 2008 Ms. Romm has served as our Chief People and Culture Officer since the closing of the Merger on April 8, 2022. Prior to the closing, Ms. Romm served as Discovery’s Chief People and Culture Officer from April 2019 to April 2022. Prior to that, Ms.
Jennifer Remling, Chief People and Culture Officer Age: 59 Executive Officer since 2024 Ms. Remling joined the Company in January 2024 and has served as our Chief People and Culture Officer since April 1, 2024. Prior to joining the Company, Ms.
Removed
Prior to the closing, he served as Discovery’s Chief Development, Distribution and Legal Officer. Mr.
Added
Aiyar served at American Airlines Group Inc., a global airline, as its Executive Vice President, Corporate Affairs and Chief Legal Officer from September 2022 to February 2025, its Senior Vice President, Corporate Affairs and Chief Legal Officer from January 2022 to September 2022, and its Senior Vice President and General Counsel from September 2019 to January 2022. Bruce L.
Removed
Locke served as Vice President, Corporate Controller and Principal Accounting Officer for Gannett Co., Inc., a media company, from June 2015 to May 2019. Jean-Briac Perrette, CEO and President, Global Streaming and Games Age: 52 Executive Officer since 2014 Mr.
Removed
Romm served as Discovery’s Chief Human Resources and Diversity Officer from March 2014 to March 2019 and Discovery’s Senior Executive Vice President of Human Resources from March 2007 to February 2014. 30 Savalle C. Sims, Chief Legal Officer Age: 53 Executive Officer since 2017 Ms.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePayment of cash dividends, if any, will be determined by our board of directors after consideration of our earnings, financial condition and other relevant factors such as our credit facility’s restrictions on our ability to declare dividends in certain situations. 31 Stock Performance Graph The following graph shows a comparison of cumulative total shareholder return, calculated on a dividend-reinvested basis, for (a) WBD common stock (which began trading on April 11, 2022) and Discovery Series A common stock, Series B convertible common stock, and Series C common stock (which ceased trading on April 8, 2022), (b) the Standard and Poor's 500 Stock Index (“S&P 500 Index”), and (c) the Standard & Poor’s 500 Media and Entertainment Industry Group Index (“S&P 500 Media & Entertainment Index”) for the five years ended December 31, 2023.
Biggest changeStock Performance Graph The following graph shows a comparison of cumulative total shareholder return, calculated on a dividend-reinvested basis, for (a) WBD common stock (which began trading on April 11, 2022) and Discovery Series A common stock, Series B convertible common stock, and Series C common stock (which ceased trading on April 8, 2022), (b) the Standard and Poor’s 500 Stock Index (“S&P 500 Index”), and (c) the Standard & Poor’s 500 Media and Entertainment Industry Group Index (“S&P 500 Media & Entertainment Index”) for the five years ended December 31, 2024.
Note that historic stock price performance is not necessarily indicative of future stock price performance. Note: Peer group indices use beginning of period market capitalization weighting. Note: Index Data: Copyright Standard and Poor’s, Inc. Used with permission. All rights reserved. Note: Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved. Copyright 1980-2024.
Note that historic stock price performance is not necessarily indicative of future stock price performance. Note: Peer group indices use beginning of period market capitalization weighting. Note: Index Data: Copyright Standard and Poor’s, Inc. Used with permission. All rights reserved. Note: Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved.
The graph assumes $100 was invested in each of Discovery Series A common stock, Series B convertible common stock, and Series C common stock, the S&P 500 Index, and the S&P 500 Media & Entertainment Index on December 31, 2018, and that $100 was invested in WBD common stock on April 11, 2022, the date on which it began trading.
The graph assumes $100 was invested in each of Discovery Series A common stock, Series B convertible common stock, and Series C common stock, the S&P 500 Index, and the S&P 500 Media & Entertainment Index on December 31, 2019, and that $100 was invested in WBD common stock on April 11, 2022, the date on which it began trading.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. WBD common stock is listed and traded on Nasdaq under the symbol “WBD”. As of February 8, 2024, there were approximately 689,822 record holders of WBD common stock.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. WBD common stock is listed and traded on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “WBD”. As of February 13, 2025, there were approximately 669,356 holders of record of WBD common stock.
Removed
December 31, April 11, December 31, 2018 2019 2020 2021 2022 2022 2023 WBD $ 100.00 $ 38.26 $ 45.92 DISCA $ 100.00 $ 132.34 $ 121.63 $ 95.15 $ 98.75 $ — $ — DISCB $ 100.00 $ 108.24 $ 96.72 $ 88.81 $ 72.99 $ — $ — DISCK $ 100.00 $ 132.11 $ 113.48 $ 99.22 $ 105.81 $ — $ — S&P 500 $ 100.00 $ 131.49 $ 155.68 $ 200.37 $ 186.24 $ 164.08 $ 207.21 S&P 500 Media & Entertainment Index $ 100.00 $ 134.15 $ 176.47 $ 224.01 $ 184.31 $ 125.65 $ 208.66 ITEM 6. [Reserved].
Added
Payment of cash dividends, if any, will be determined by our board of directors after consideration of our earnings, financial condition and other relevant factors such as our credit facility’s restrictions on our ability to declare dividends in certain situations.
Added
Copyright 1980-2025. 32 December 31, April 11, December 31, 2019 2020 2021 2022 2022 2023 2024 WBD $ 100.00 $ 38.26 $ 45.92 $ 42.66 DISCA $ 100.00 $ 91.91 $ 71.90 $ 74.62 $ — $ — $ — DISCB $ 100.00 $ 89.35 $ 82.05 $ 67.43 $ — $ — $ — DISCK $ 100.00 $ 85.90 $ 75.11 $ 80.09 $ — $ — $ — S&P 500 Index $ 100.00 $ 118.40 $ 152.39 $ 141.64 $ 124.79 $ 157.59 $ 197.02 S&P 500 Media & Entertainment Index $ 100.00 $ 131.54 $ 166.98 $ 137.39 $ 93.66 $ 155.53 $ 220.01 ITEM 6. [Reserved].

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeYear Ended December 31, 2023 2022 % Change Actual Actual Pro Forma Adjustments Pro Forma Combined Actual Pro Forma Combined (Actual) Pro Forma Combined (ex-FX) Revenues: Distribution $ 17 $ 12 $ 6 $ 18 42 % (6) % (6) % Advertising 15 15 9 24 — % (38) % (38) % Content 11,358 9,156 3,898 13,054 24 % (13) % (13) % Other 802 548 154 702 46 % 14 % 13 % Total revenues 12,192 9,731 4,067 13,798 25 % (12) % (12) % Costs of revenues, excluding depreciation and amortization 7,296 6,310 2,392 8,702 16 % (16) % (16) % Selling, general and administrative 2,713 1,649 698 2,347 65 % 16 % 16 % Adjusted EBITDA 2,183 1,772 977 2,749 23 % (21) % (21) % Depreciation and amortization 667 501 39 540 Employee share-based compensation — 1 26 27 Restructuring and other charges 225 1,050 (38) 1,012 Transaction and integration costs 7 9 — 9 Amortization of fair value step-up for content 995 1,370 (785) 585 Amortization of capitalized interest for content 46 — — — Inter-segment eliminations 31 5 — 5 Impairments and loss on dispositions 1 30 — 30 Operating income (loss) $ 211 $ (1,194) $ 1,735 $ 541 The discussion below reflects the results for the year ended December 31, 2022 on a pro forma combined basis, ex-FX, since the actual increases year over year for revenues, cost of revenue, selling, general and administrative expenses and Adjusted EBITDA are substantially attributable to the Merger.
Biggest changeYear Ended December 31, 2024 2023 % Change % Change (ex-FX) Revenues: Distribution $ 8 $ 17 (53) % (53) % Advertising 5 15 (67) % (67) % Content 10,717 11,358 (6) % (5) % Other 877 802 9 % 9 % Total revenues 11,607 12,192 (5) % (5) % Costs of revenues, excluding depreciation and amortization 7,530 7,296 3 % 3 % Selling, general and administrative 2,425 2,713 (11) % (11) % Adjusted EBITDA 1,652 2,183 (24) % (23) % Depreciation and amortization 702 667 Employee share-based compensation (1) — Restructuring and other charges 263 225 Transaction and integration costs 2 7 Facility consolidation costs 1 — Impairment and amortization of fair value step-up for content 96 995 Amortization of capitalized interest for content 46 46 Inter-segment eliminations — 31 Impairments and loss on dispositions 14 1 Operating income $ 529 $ 211 Unless otherwise indicated, the discussion of percent changes below is on an ex-FX basis.
We believe the following accounting estimates are critical to our business operations and the understanding of our results of operations and involve the more significant judgments and estimates used in the preparation of our consolidated financial statements. 49 Uncertain Tax Positions We are subject to income taxes in numerous U.S. and foreign jurisdictions.
We believe the following accounting estimates are critical to our business operations and the understanding of our results of operations and involve the more significant judgments and estimates used in the preparation of our consolidated financial statements. Uncertain Tax Positions We are subject to income taxes in numerous U.S. and foreign jurisdictions.
BUSINESS OVERVIEW On April 8, 2022, Discovery, a global media company that provides content across multiple distribution platforms, including linear, free-to-air, and broadcast television, authenticated GO applications, digital distribution arrangements, content licensing arrangements, and DTC subscription products, completed its Merger with the WM Business of AT&T and changed its name from “Discovery, Inc.” to “Warner Bros.
BUSINESS OVERVIEW On April 8, 2022, Discovery, a global media company that provides content across multiple distribution platforms, including linear, free-to-air, and broadcast television, authenticated GO applications, digital distribution arrangements, content licensing arrangements, and DTC subscription products, completed its Merger with the WarnerMedia Business of AT&T and changed its name from “Discovery, Inc.” to “Warner Bros.
Our senior notes outstanding as of December 31, 2023 had interest rates that ranged from 1.90% to 8.30% and will mature between 2024 and 2062. We expect that our cash balance, cash generated from operations, and availability under the Credit Agreement will be sufficient to fund our cash needs for both the short-term and the long-term.
Our senior notes outstanding as of December 31, 2024 had interest rates that ranged from 1.90% to 8.30% and will mature between 2025 and 2062. We expect that our cash balance, cash generated from operations, and availability under the Credit Agreement will be sufficient to fund our cash needs for both the short-term and the long-term.
(See Note 19 to the accompanying consolidated financial statements.) Noncontrolling Interest The Food Network and Cooking Channel are operated and organized under the terms of the TV Food Network Partnership (the “Partnership”). We hold interests in the Partnership, along with another noncontrolling owner. The Partnership agreement specifies a dissolution date of December 31, 2024.
(See Note 19 to the accompanying consolidated financial statements.) Noncontrolling Interest The Food Network and Cooking Channel are operated and organized under the terms of the TV Food Network Partnership (the “Partnership”). We hold interests in the Partnership, along with another noncontrolling owner. The Partnership agreement specifies a dissolution date of December 31, 2025.
(1,447) Additional information regarding the changes in our outstanding indebtedness and the significant terms and provisions of our revolving credit facility and outstanding indebtedness is discussed in Note 11 to the accompanying consolidated financial statements included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K.
(1,037) Additional information regarding the changes in our outstanding indebtedness and the significant terms and provisions of our revolving credit facility and outstanding indebtedness is discussed in Note 11 to the accompanying consolidated financial statements included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K.
As of December 31, 2023, we classified our operations in three reportable segments: • Studios - Our Studios segment primarily consists of the production and release of feature films for initial exhibition in theaters, production and initial licensing of television programs to our networks/DTC services as well as third parties, distribution of our films and television programs to various third party and internal television and streaming services, distribution through the home entertainment market (physical and digital), related consumer products and themed experience licensing, and interactive gaming. • Networks - Our Networks segment primarily consists of our domestic and international television networks. • DTC - Our DTC segment primarily consists of our premium pay-TV and streaming services.
As of December 31, 2024, we classified our operations in three reportable segments: • Studios - Our Studios segment primarily consists of the production and release of feature films for initial exhibition in theaters, production and initial licensing of television programs to our networks/DTC services as well as third parties, distribution of our films and television programs to various third party and internal television and streaming services, distribution through the home entertainment market (physical and digital), related consumer products and themed experience licensing, and interactive gaming. 33 • Networks - Our Networks segment primarily consists of our domestic and international television networks. • DTC - Our DTC segment primarily consists of our premium pay-TV and streaming services.
NEW ACCOUNTING AND REPORTING PRONOUNCEMENTS We adopted certain accounting and reporting standards during 2023. Information regarding our adoption of new accounting and reporting standards is discussed in Note 2 to the accompanying consolidated financial statements included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K.
NEW ACCOUNTING AND REPORTING PRONOUNCEMENTS We adopted certain accounting and reporting standards during 2024. Information regarding our adoption of new accounting and reporting standards is discussed in Note 2 to the accompanying consolidated financial statements included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K.
Results on a constant currency basis, as we present them, may not be comparable to similarly titled measures used by other companies. 34 Consolidated Results of Operations – 2023 vs. 2022 Our consolidated results of operations for 2023 and 2022 were as follows (in millions).
Results on a constant currency basis, as we present them, may not be comparable to similarly titled measures used by other companies. 34 Consolidated Results of Operations – 2024 vs. 2023 Our consolidated results of operations for 2024 and 2023 were as follows (in millions).
Ownership interests in unconsolidated entities for which we have significant influence are accounted for as equity method. We evaluated reconsideration events during the year ended December 31, 2023 and concluded there were no changes to our consolidation assessments.
Ownership interests in unconsolidated entities for which we have significant influence are accounted for as equity method. We evaluated reconsideration events during the year ended December 31, 2024 and concluded there were no changes to our consolidation assessments.
We finalized the framework supporting our ongoing restructuring and transformation initiatives during the year ended December 31, 2022, which includes, among other things, strategic content programming assessments, organization restructuring, facility consolidation activities, and other contract termination costs.
We finalized the framework supporting our ongoing restructuring and transformation initiatives during the year ended December 31, 2022, which included, among other things, strategic content programming assessments, organization restructuring, facility consolidation activities, and other contract termination costs.
(See Note 17 to the accompanying consolidated financial statements.) Contractual commitments include payments to meet minimum funding requirements of our Pension Plans in 2024 and estimated benefit payments. Benefit payments have been estimated over a ten-year period.
(See Note 17 to the accompanying consolidated financial statements.) Contractual commitments include payments to meet minimum funding requirements of our Pension Plans in 2025 and estimated benefit payments. Benefit payments have been estimated over a ten-year period.
Adjusted EBITDA is defined as operating income excluding: • employee share-based compensation; • depreciation and amortization; • restructuring and facility consolidation; • certain impairment charges; • gains and losses on business and asset dispositions; • certain inter-segment eliminations; • third-party transaction and integration costs; • amortization of purchase accounting fair value step-up for content; • amortization of capitalized interest for content; and • other items impacting comparability.
Adjusted EBITDA is defined as operating income excluding: • employee share-based compensation; • depreciation and amortization; • restructuring and facility consolidation; • certain impairment charges; • gains and losses on business and asset dispositions; • third-party transaction and integration costs; • amortization of purchase accounting fair value step-up for content; • amortization of capitalized interest for content; and • other items impacting comparability.
(See Note 13 to the accompanying consolidated financial statements.) Uses of Cash Our primary uses of cash include the creation and acquisition of new content, business acquisitions, income taxes, personnel costs, costs to develop and market our streaming service Max, principal and interest payments on our outstanding senior notes and term loan, funding for various equity method and other investments, and repurchases of our capital stock. 43 • Content Acquisition We plan to continue to invest significantly in the creation and acquisition of new content, as well as certain sports rights.
(See Note 13 to the accompanying consolidated financial statements.) Uses of Cash Our primary uses of cash include the creation and acquisition of new content, business acquisitions, income taxes, personnel costs, costs to develop and market our enhanced streaming service Max, principal and interest payments on our outstanding senior notes, funding for various equity method and other investments, and repurchases of our capital stock. • Content Acquisition We plan to continue to invest significantly in the creation and acquisition of new content, as well as certain sports rights.
Content revenues are generated from the release of feature films for initial exhibition in theaters, the licensing of feature films and television programs to various television, SVOD and other digital markets, distribution of feature films and television programs in the physical and digital home entertainment market, sales of console games and mobile in-game content, sublicensing of sports rights, and licensing of intellectual property such as characters and brands.
Content revenues are generated from the release of feature films for initial exhibition in theaters, production of programs licensed for initial television/SVOD exhibition, the additional licensing of feature films and television programs to various television, SVOD and other digital markets, distribution of feature films and television programs in the physical and digital home entertainment market, sales of console games and mobile in-game content, sublicensing of sports rights, and licensing of intellectual property such as characters and brands.
The content amortization expense related to the inter-segment profit is also eliminated on the separate “Eliminations” line when presenting our summary of segment results. 42 LIQUIDITY AND CAPITAL RESOURCES Liquidity Sources of Cash Historically, we have generated a significant amount of cash from operations. During 2023, we funded our working capital needs primarily through cash flows from operations.
The content amortization expense related to the inter-segment profit is also eliminated on the separate “Eliminations” line when presenting our summary of segment results. LIQUIDITY AND CAPITAL RESOURCES Liquidity Sources of Cash Historically, we have generated a significant amount of cash from operations. During 2024, we funded our working capital needs primarily through cash flows from operations.
We may also request additional commitments up to $1.0 billion from the lenders upon the satisfaction of certain conditions. The Revolving Credit Agreement contains customary representations and warranties as well as affirmative and negative covenants. As of December 31, 2023, we were in compliance with all covenants and there were no events of default under the Revolving Credit Agreement.
We may also request additional commitments up to $1.0 billion from the lenders upon the satisfaction of certain conditions. The Credit Agreement contains customary representations and warranties as well as affirmative and negative covenants. As of December 31, 2024, we were in compliance with all covenants and there were no events of default under the Credit Agreement.
Foreign Exchange Impacting Comparability In addition to the Merger, the impact of exchange rates on our business is an important factor in understanding period-to-period comparisons of our results. For example, our international revenues are favorably impacted as the U.S. dollar weakens relative to other foreign currencies, and unfavorably impacted as the U.S. dollar strengthens relative to other foreign currencies.
RESULTS OF OPERATIONS Foreign Exchange Impacting Comparability The impact of exchange rates on our business is an important factor in understanding period-to-period comparisons of our results. For example, our international revenues are favorably impacted as the U.S. dollar weakens relative to other foreign currencies, and unfavorably impacted as the U.S. dollar strengthens relative to other foreign currencies.
Significant judgment is exercised in evaluating all relevant information, the technical merits of the tax positions, and the accurate measurement of uncertain tax positions when determining the amount of reserve and whether positions taken on our tax returns are more likely than not to be sustained.
Significant judgment is exercised in evaluating all relevant information, the technical merits of the tax positions, and the accurate measurement of unrecognized tax benefits when determining the amount of reserve and whether positions taken on our tax returns are more likely than not to be sustained.
As of December 31, 2023, we had $3.8 billion of cash and cash equivalents on hand. We are a well-known seasoned issuer and have the ability to conduct registered offerings of securities, including debt securities, common stock and preferred stock, on short notice, subject to market conditions. Access to sufficient capital from the public market is not assured.
As of December 31, 2024, we had $5.3 billion of cash and cash equivalents on hand. We are a well-known seasoned issuer and have the ability to conduct registered offerings of securities, including debt securities, common stock and preferred stock, on short notice, subject to market conditions. Access to sufficient capital from the public market is not assured.
(See Note 3 to the accompanying consolidated financial statements.) There were no common stock repurchases during 2023 or 2022. 44 • Income Taxes and Interest We expect to continue to make payments for income taxes and interest on our outstanding senior notes.
(See Note 3 to the accompanying consolidated financial statements.) There were no common stock repurchases during 2024 or 2023. • Income Taxes and Interest We expect to continue to make payments for income taxes and interest on our outstanding senior notes.
Streaming and premium pay-TV content amortization is based on estimated viewing patterns, as there are generally limited to no direct revenues to associate to the individual content assets for premium pay-TV. As such, number of views is most representative of the use of the title.
Streaming and premium pay-TV content amortization is based on estimated viewing patterns, as there are generally limited to no direct revenues to associate to the individual content assets for premium pay-TV. As such, viewership is most representative of the use of the title.
A discussion of our results of operations and liquidity for the fiscal year ended December 31, 2022 compared to the fiscal year ended December 31, 2021 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed on February 24, 2022, which is available free of charge on the SEC’s website at www.sec.gov and our Investor Relations website at ir.wbd.com.
A discussion of our results of operations and liquidity for the fiscal year ended December 31, 2023 compared to the fiscal year ended December 31, 2022 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed on February 23, 2024, which is available free of charge on the SEC’s website at www.sec.gov and our Investor Relations website at ir.wbd.com.
We establish a reserve for uncertain tax positions unless we determine that such positions are more likely than not to be sustained upon examination based on their technical merits, including the resolution of any appeals or litigation processes. We include interest and where appropriate, potential penalties, as a component of income tax expense on the consolidated statement of operations.
We establish a reserve for unrecognized tax benefits unless we determine that such positions are more likely than not to be sustained upon examination based on their technical merits, including the resolution of any appeals or litigation processes. We include interest and where appropriate, potential penalties, as a component of income tax expense on the consolidated statements of operations.
The ex-FX change is calculated as the difference between the current year amounts translated at a baseline rate, which is a spot rate for each of our currencies determined early in the fiscal year as part of our forecasting process (the “2023 Baseline Rate”), and the prior year amounts translated at the same 2023 Baseline Rate.
The ex-FX change is calculated as the difference between the current year amounts translated at a baseline rate, which is a spot rate for each of our currencies determined early in the fiscal year as part of our forecasting process (the “2024 Baseline Rate”), and the prior year amounts translated at the same 2024 Baseline Rate.
Because of the specific circumstances surrounding the arrangements and the fact that no active or observable market exists for this type of financial guarantee, we are unable to determine a current fair value for the Guaranteed Obligations and related Subordinated Indemnity Agreement.
Because of the specific circumstances surrounding the arrangements and the fact that no active or observable market exists for this type of financial guarantee, the Company is unable to determine a current fair value for the Guaranteed Obligations and related Subordinated Indemnity Agreement.
Inter-segment content transactions are presented “gross” (i.e. the segment producing and/or licensing the content reports revenue and profit from inter-segment transactions in a manner similar to the reporting of third-party transactions, and the required eliminations are reported on the separate “Eliminations” line when presenting our summary of segment results).
Inter-segment content transactions are generally presented at market value (i.e., the segment producing and/or licensing the content reports revenue and profit from inter-segment transactions in a manner similar to the reporting of third-party transactions, and the required eliminations are reported on the separate “Eliminations” line when presenting our summary of segment results).
The aggregate gross undiscounted estimated future cash flow requirements covered by the Six Flags Guarantee over the remaining term (through 2028) are $521 million. To date, no payments have been made by us pursuant to the Six Flags Guarantee.
The aggregate gross undiscounted estimated future cash flow requirements covered by the Six Flags Guarantee over the remaining term (through 2028) are $589 million. To date, no payments have been made by the Company pursuant to the Six Flags Guarantee.
For such contracts, judgment is required in measuring progress across our single performance obligation. Various factors such as pricing specific to the channel, daypart and targeted demographic, as well as audience guarantees, are considered in determining how to appropriately measure progress across the campaigns.
These advertising campaigns are considered to represent a single, distinct performance obligation. For such contracts, judgment is required in measuring progress across our single performance obligation. Various factors such as pricing specific to the channel, daypart and targeted demographic, as well as audience guarantees, are considered in determining how to appropriately measure progress across the campaigns.
The outstanding portfolio of receivables derecognized from our consolidated balance sheets was $5,200 million as of December 31, 2023. • Accounts Receivable Factoring We have a factoring agreement to sell certain of our non-U.S. trade accounts receivable on a limited recourse basis to a third-party financial institution.
The outstanding portfolio of receivables derecognized from our consolidated balance sheets was $4,637 million as of December 31, 2024. • Accounts Receivable Factoring We have a factoring agreement to sell certain of our non-U.S. trade accounts receivable on a limited recourse basis to a third-party financial institution.
If Six Flags defaults on its indemnification obligations, we have the right to acquire control of the managing partner of the Parks. Six Flags’ obligations to us are further secured by its interest in all limited partnership units held by Six Flags.
If Six Flags defaults on its indemnification obligations, the Company has the right to acquire control of the managing partner of the Parks. Six Flags’ obligations to the Company are further secured by its interest in all limited partnership units held by Six Flags.
During 2023 and 2022, we made cash payments of $1,440 million and $1,027 million for income taxes and $2,237 million and $1,539 million for interest on our outstanding debt, respectively. Cash Flows The following table presents changes in cash and cash equivalents (in millions).
During 2024 and 2023, we made cash payments of $1,113 million and $1,440 million for income taxes and $1,996 million and $2,237 million for interest on our outstanding debt, respectively. Cash Flows The following table presents changes in cash and cash equivalents (in millions).
Based on our evaluation of the current facts and circumstances surrounding the Guaranteed Obligations and the Subordinated Indemnity Agreement, we are unable to predict the loss, if any, that may be incurred under the Guaranteed Obligations, and no liability for the arrangements has been recognized as of December 31, 2023.
Based on the Company’s evaluation of the current facts and circumstances surrounding the Guaranteed Obligations and the Subordinated Indemnity Agreement, it is unable to predict the loss, if any, that may be incurred under the Guaranteed Obligations, and no liability for the arrangements has been recognized as of December 31, 2024.
After March 2024, the senior notes are redeemable at par plus accrued and unpaid interest. Revolving Credit Facility and Commercial Paper We have a multicurrency revolving credit agreement (the “Revolving Credit Agreement”) and have the capacity to borrow up to $6.0 billion under the Revolving Credit Agreement (the “Credit Facility”).
After December 2029 and February 2033, respectively, the senior notes are redeemable at par plus accrued and unpaid interest. Revolving Credit Facility and Commercial Paper We have a multicurrency revolving credit agreement (the “Credit Agreement”) and have the capacity to borrow up to $6.0 billion under the Credit Agreement (the “Credit Facility”).
As of December 31, 2023, the current portion of the liability for cash-settled share-based compensation awards was $10 million.
As of December 31, 2024, the current portion of the liability for cash-settled share-based compensation awards was $27 million.
Adjusted EBITDA Adjusted EBITDA decreased 21% in 2023. 39 Networks Segment The table below presents, for our Networks segment, revenues by type, certain operating expenses, Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating income (in millions).
Adjusted EBITDA Adjusted EBITDA decreased 23% in 2024. Networks Segment The table below presents, for our Networks segment, revenues by type, certain operating expenses, Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating (loss) income (in millions).
(See Note 11 and Note 13 to the accompanying consolidated financial statements.) Loss from Equity Investees, net Actual losses from our equity method investees were $82 million and $160 million in 2023 and 2022, respectively. The changes are attributable to the Company’s share of earnings and losses from its equity investees.
(See Note 11 to the accompanying consolidated financial statements.) Loss from Equity Investees, net Actual losses from our equity method investees were $121 million and $82 million in 2024 and 2023, respectively. The losses are attributable to our share of earnings and losses from our equity investees.
For a discussion of our global portfolio see our business overview set forth in Item 1, “Business” in this Annual Report on Form 10-K. In connection with the Merger, we have announced and taken actions to implement projects to achieve cost synergies for the Company.
Television Group, Warner Bros. Games, Adult Swim, Turner Classic Movies, and others. For a discussion of our global portfolio see our business overview set forth in Item 1, “Business” in this Annual Report on Form 10-K. In connection with the Merger, we have announced and taken actions to implement projects to achieve cost synergies for the Company.
We expect that we will incur approximately $4.1 - $5.3 billion in pre-tax restructuring charges, of which we have incurred $4.2 billion as of December 31, 2023. Of the total expected pre-tax restructuring charges, we expect total cash expenditures to be $1.0 - $1.5 billion.
At that time, we expected to incur approximately $4.1 - $5.3 billion in pre-tax restructuring charges, of which we have incurred $4.7 billion as of December 31, 2024. Of the total expected pre-tax restructuring charges, we expected total cash expenditures to be $1.0 - $1.5 billion.
Additionally, our commercial paper program is supported by the Credit Facility. Under the commercial paper program, we may issue up to $1.5 billion, including up to $500 million of euro-denominated borrowings. Borrowing capacity under the Credit Facility is effectively reduced by any outstanding borrowings under the commercial paper program.
Additionally, our commercial paper program is supported by the Credit Facility. Under the commercial paper program, we may issue up to $1.0 billion. Borrowing capacity under the Credit Facility is effectively reduced by any outstanding borrowings under the commercial paper program.
Whether or not we purchase or exchange any of our debt and the size and timing of any such purchases or exchanges will be determined at our discretion. • Capital Expenditures We effected capital expenditures of $1,316 million in 2023, including amounts capitalized to support Max.
Whether or not we repurchase or exchange any debt and the size and timing of any such repurchases or exchanges will be determined at our discretion. 44 • Capital Expenditures We effected capital expenditures of $948 million in 2024, including amounts capitalized to support Max.
Note Guarantees issued by Scripps Networks, DCL or WMH, or any subsidiary of the Parent that in the future issues a Note Guarantee (each, a “Subsidiary Guarantor”) may be released and discharged (i) concurrently with any direct or indirect sale or disposition of such Subsidiary Guarantor or any interest therein, (ii) at any time that such Subsidiary Guarantor is released from all of its obligations under its guarantee of payment, (iii) upon the merger or consolidation of any Subsidiary Guarantor with and into DCL, WMH or the Parent or another Subsidiary Guarantor, as applicable, or upon the liquidation of such Subsidiary Guarantor and (iv) other customary events constituting a discharge of the Obligors’ obligations. 48 Summarized Financial Information The Company has included the accompanying summarized combined financial information of the Obligors after the elimination of intercompany transactions and balances among the Obligors and the elimination of equity in earnings from and investments in any subsidiary of the Parent that is a non-guarantor (in millions).
Note Guarantees issued by Scripps Networks, DCL or WMH, or any subsidiary of the Parent that in the future issues a Note Guarantee (each, a “Subsidiary Guarantor”) may be released and discharged (i) concurrently with any direct or indirect sale or disposition of such Subsidiary Guarantor or any interest therein, (ii) at any time that such Subsidiary Guarantor is released from all of its obligations under its guarantee of payment, (iii) upon the merger or consolidation of any Subsidiary Guarantor with and into DCL, WMH or the Parent or another Subsidiary Guarantor, as applicable, or upon the liquidation of such Subsidiary Guarantor and (iv) other customary events constituting a discharge of the Obligors’ obligations.
Year Ended December 31, 2023 2022 Cash, cash equivalents, and restricted cash, beginning of period $ 3,930 $ 3,905 Cash provided by operating activities 7,477 4,304 Cash (used in) provided by investing activities (1,259) 3,524 Cash used in financing activities (5,837) (7,742) Effect of exchange rate changes on cash, cash equivalents, and restricted cash 8 (61) Net change in cash, cash equivalents, and restricted cash 389 25 Cash, cash equivalents, and restricted cash, end of period $ 4,319 $ 3,930 Operating Activities Cash provided by operating activities was $7,477 million and $4,304 million in 2023 and 2022, respectively.
Year Ended December 31, 2024 2023 Cash, cash equivalents, and restricted cash, beginning of period $ 4,319 $ 3,930 Cash provided by operating activities 5,375 7,477 Cash used in investing activities (349) (1,259) Cash used in financing activities (3,749) (5,837) Effect of exchange rate changes on cash, cash equivalents, and restricted cash (180) 8 Net change in cash, cash equivalents, and restricted cash 1,097 389 Cash, cash equivalents, and restricted cash, end of period $ 5,416 $ 4,319 Operating Activities Cash provided by operating activities was $5,375 million and $7,477 million in 2024 and 2023, respectively.
(See Note 19 to the accompanying consolidated financial statements.) Distributions to noncontrolling interests and redeemable noncontrolling interests totaled $301 million and $300 million in 2023 and 2022, respectively. • Common Stock Repurchases Historically, we have funded our stock repurchases through a combination of cash on hand, cash generated by operations and the issuance of debt.
Distributions to noncontrolling interests and redeemable noncontrolling interests totaled $193 million and $301 million in 2024 and 2023, respectively. • Common Stock Repurchases Historically, we have funded our stock repurchases through a combination of cash on hand, cash generated by operations and the issuance of debt.
This section provides additional information regarding our businesses, current developments, results of operations, cash flows, financial condition, contractual commitments, critical accounting policies, and estimates that require significant judgment and thus have the most significant potential impact on our consolidated financial statements.
This section provides additional information regarding our businesses, current developments, results of operations, cash flows, financial condition, contractual commitments, critical accounting policies, and estimates that require significant judgment and thus have the most significant potential impact on our consolidated financial statements. This discussion and analysis is intended to better allow investors to view the company from management’s perspective.
Year Ended December 31, 2023 2022 % Change Studios $ 2,183 $ 1,772 23 % Networks 9,063 8,725 4 % DTC 103 (1,596) NM Corporate (1,242) (1,200) (4) % Inter-segment eliminations 93 17 NM 38 Studios Segment The following table presents, for our Studios segment, revenues by type, certain operating expenses, Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating income (loss) (in millions).
Year Ended December 31, 2024 2023 % Change Studios $ 1,652 $ 2,183 (24) % Networks 8,149 9,063 (10) % DTC 677 103 NM Corporate (1,260) (1,242) (1) % Inter-segment eliminations (186) 93 NM 38 Studios Segment The following table presents, for our Studios segment, revenues by type, certain operating expenses, Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating income (in millions).
Other Contingent Commitments Other contingent commitments primarily include contingent payments for post-production term advance obligations on a certain co-financing arrangement, as well as operating lease commitment guarantees, letters of credit, bank guarantees, and surety bonds, which generally support performance and payments for a wide range of global contingent and firm obligations, including insurance, litigation appeals, real estate leases, and other operational needs. 47 The Company’s other contingent commitments at December 31, 2023 were $395 million, with $367 million estimated to be due in 2024.
Other Contingent Commitments Other contingent commitments primarily include contingent payments for post-production term advance obligations on a certain co-financing arrangement, as well as operating lease commitment guarantees, letters of credit, bank guarantees, and surety bonds, which generally support performance and payments for a wide range of global contingent and firm obligations, including insurance, litigation appeals, real estate leases, and other operational needs.
Selling, General and Administrative Selling, general and administrative expenses decreased 4% in 2023, primarily attributable to lower marketing and personnel expenses. Adjusted EBITDA Adjusted EBITDA decreased 9% in 2023. 40 DTC Segment The following table presents, for our DTC segment, revenues by type, certain operating expenses, Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating loss (in millions).
Selling, General and Administrative Selling, general and administrative expenses decreased 1% in 2024. 40 Adjusted EBITDA Adjusted EBITDA decreased 10% in 2024. DTC Segment The following table presents, for our DTC segment, revenues by type, certain operating expenses, Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating loss (in millions).
Additional information regarding contractual commitments to acquire content is set forth in “Material Cash Requirements from Known Contractual and Other Obligations” in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” • Debt Term Loan During the year ended December 31, 2023, we repaid $4.0 billion of aggregate principal amount outstanding of our term loan prior to the due date of April 2025.
Additional information regarding contractual commitments to acquire content is set forth in “Material Cash Requirements from Known Contractual and Other Obligations” in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” • Debt Floating Rate Notes During the year ended December 31, 2024, we repaid $40 million of aggregate principal amount of our floating rate notes due March 2024.
During the year ended December 31, 2023, we borrowed and repaid $5,207 million and $5,214 million, respectively, under our Credit Facility and commercial paper program.
During the year ended December 31, 2024, we borrowed and repaid $14,203 million under our Credit Facility and commercial paper program.
While benefit payments under the Pension Plans are expected to continue beyond 2033, we believe it is not practicable to estimate payments beyond this period. We are unable to reasonably predict the ultimate amount of any payments due to cash-settled share-based compensation awards.
While benefit payments under the Pension Plans are expected to continue beyond 2034, we believe it is not practicable to estimate payments beyond this period. Other employee obligations are primarily related to employment agreements with creative talent for certain broadcast networks. We are unable to reasonably predict the ultimate amount of any payments due to cash-settled share-based compensation awards.
Distribution revenues are largely dependent on the rates negotiated in the agreements, the number of subscribers that receive our networks, the number of platforms covered in the distribution agreement, and the market demand for the content that we provide.
Distribution revenues are largely dependent on the rates negotiated in the agreements, the number of subscribers that receive our networks, the number of platforms covered in the distribution agreement, and the market demand for the content that we provide. From time to time, renewals of multi-year carriage agreements include significant year one market adjustments to reset subscriber rates.
For further discussion of financial information for our segments and the geographical areas in which we do business, our content development activities, and revenues, see our business overview set forth in Item 1, “Business” and Note 23 to the consolidated financial statements included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K. 33 RESULTS OF OPERATIONS The discussion below compares our actual results for the year ended December 31, 2023 to our pro forma combined results for the year ended December 31, 2022, as if the Merger occurred on January 1, 2021.
For further discussion of financial information for our segments and the geographical areas in which we do business, our content development activities, and revenues, see our business overview set forth in Item 1, “Business” and Note 23 to the consolidated financial statements included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K.
Adjusted EBITDA Adjusted EBITDA increased $2,150 million in 2023. 41 Corporate The following table presents our Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating loss (in millions): Year Ended December 31, 2023 2022 % Change Actual Actual Pro Forma Adjustments Pro Forma Combined Actual Pro Forma Combined (Actual) Pro Forma Combined (ex-FX) Adjusted EBITDA $ (1,242) $ (1,200) $ (353) $ (1,553) (4) % 20 % 20 % Employee share-based compensation 488 410 (11) 399 Depreciation and amortization 294 272 (40) 232 Restructuring and other charges 95 195 (44) 151 Transaction and integration costs 148 1,182 (564) 618 Impairments and loss on dispositions 60 50 — 50 Facility consolidation costs 32 — — — Amortization of fair value step-up for content (6) — — — Inter-segment eliminations (193) (31) — (31) Operating loss $ (2,160) $ (3,278) $ 306 $ (2,972) Corporate operations primarily consist of executive management and administrative support services, which are recorded in selling, general and administrative expense, as well as substantially all of our share-based compensation and third-party transaction and integration costs.
Corporate The following table presents our Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating loss (in millions): Year Ended December 31, 2024 2023 % Change % Change (ex-FX) Adjusted EBITDA $ (1,260) $ (1,242) (1) % (3) % Employee share-based compensation 547 488 Depreciation and amortization 332 294 Restructuring and other charges 96 95 Transaction and integration costs 239 148 Impairments and loss on dispositions 388 60 Facility consolidation costs 3 32 Impairment and amortization of fair value step-up for content 2 (6) Inter-segment eliminations — (193) Operating loss $ (2,867) $ (2,160) Corporate operations primarily consist of executive management and administrative support services, which are recorded in selling, general and administrative expense, as well as substantially all of our share-based compensation and third-party transaction and integration costs.
Content Rights We capitalize the costs to produce or acquire feature films and television programs, and we amortize costs and test for impairment based on whether the content is predominantly monetized individually, or as a group. 50 For films and television programs predominantly monetized individually, the amount of capitalized film and television production costs (net of incentives) amortized and the amount of participations and residuals to be recognized as expense in a particular period are determined using the individual film forecast method.
For films and television programs predominantly monetized individually, the amount of capitalized film and television production costs (net of incentives) amortized and the amount of participations and residuals to be recognized as expense in a particular period are determined using the individual film forecast method.
Other revenue increased 14% in 2023, primarily attributable to the opening of Warner Bros. Studio Tour Tokyo in June 2023, continued strong attendance at Warner Bros. Studio Tour London and Hollywood, and services provided to the unconsolidated TNT Sports joint venture. Costs of Revenues Our principal component of costs of revenues is content expense.
Other revenue primarily consists of studio production services and tours. Other revenue increased 4% in 2024, primarily attributable to the opening of Warner Bros. Studio Tour Tokyo in June 2023, partially offset by the timing of services provided to the unconsolidated TNT Sports UK joint venture. Costs of Revenues Our principal component of costs of revenues is content expense.
Additionally, our commercial paper program is supported by the Credit Facility. Under the commercial paper program, we may issue up to $1.5 billion, including up to $500 million of euro-denominated borrowings. Borrowing capacity under the Credit Facility is effectively reduced by any outstanding borrowings under the commercial paper program.
Additionally, our commercial paper program is supported by the Credit Facility. Under the commercial paper program, we may issue up to $1.0 billion. Borrowing capacity under the Credit Facility is effectively reduced by any outstanding borrowings under the commercial paper program. As of December 31, 2024, we had no outstanding borrowings under the Credit Facility or the commercial paper program.
DCL is a wholly owned subsidiary of the Company. Scripps Networks is also wholly owned by the Company. The tables below present the summarized financial information as combined for Warner Bros. Discovery, Inc. (the “Parent”), Scripps Networks, DCL, and WMH (collectively, the “Obligors”).
(See Note 11 to the accompanying consolidated financial statements.) DCL, Scripps Networks, and WMH are wholly owned by the Company. 48 The tables below present the summarized financial information as combined for Warner Bros. Discovery, Inc. (the “Parent”), Scripps Networks, DCL, and WMH (collectively, the “Obligors”).
December 31, 2023 Total Capacity Outstanding Indebtedness Unused Capacity Cash and cash equivalents $ 3,780 $ — $ 3,780 Revolving credit facility and commercial paper program 6,000 — 6,000 Senior notes (a) 43,955 43,955 — Total $ 53,735 $ 43,955 $ 9,780 (a) Interest on senior notes is paid annually, semi-annually, or quarterly.
December 31, 2024 Total Capacity Outstanding Indebtedness Unused Capacity Cash and cash equivalents $ 5,312 $ — $ 5,312 Revolving credit facility and commercial paper program 6,000 — 6,000 Senior notes (a) 39,527 39,527 — Total $ 50,839 $ 39,527 $ 11,312 (a) Interest on senior notes is paid annually, semi-annually, or quarterly.
For a film or television program that is predominantly monetized on its own but also monetized with other films and/or programs (such as on our DTC or linear services), we make a reasonable estimate of the value attributable to the film or program’s exploitation while monetized with other films/programs, based on relative market rates, and expense such costs as the film or television program is exhibited.
For television programs that are monetized on an individual basis, ultimate revenues are estimated based on factors including the performance of similar programs in each applicable market, firm commitments in hand from customers that license the program in the future, and the popularity of the program in its initial markets. 51 For a film or television program that is predominantly monetized on its own but also monetized with other films and/or programs (such as on our DTC or linear services), we make a reasonable estimate of the value attributable to the film or program’s exploitation while monetized with other films/programs, based on relative market rates, and expense such costs as the film or television program is exhibited.
Financing Activities Cash used in financing activities was $5,837 million and $7,742 million in 2023 and 2022, respectively. The decrease in cash used in financing activities was primarily attributable to less net debt activity during the year ended December 31, 2023. Capital Resources As of December 31, 2023, capital resources were comprised of the following (in millions).
The decrease in cash used in financing activities was primarily attributable to lower net debt activity and lower distributions to noncontrolling interests and redeemable noncontrolling interests during the year ended December 31, 2024. 45 Capital Resources As of December 31, 2024, capital resources were comprised of the following (in millions).
As of December 31, 2023, we had no outstanding borrowings under the Credit Facility or the commercial paper program. (See Note 11 to the accompanying consolidated financial statements.) Purchase Obligations Content purchase obligations include commitments associated with third-party producers and sports associations for content that airs on our television networks and DTC services.
(See Note 11 to the accompanying consolidated financial statements.) 46 Purchase Obligations Content purchase obligations include commitments associated with third-party producers and sports associations for content that airs on our television networks and DTC services.
Components are aggregated into a single reporting unit if they share similar economic characteristics. Our reporting units are Studios, Networks, and DTC. We evaluate our goodwill for impairment annually as of October 1 or earlier upon the occurrence of substantive unfavorable changes in economic conditions, industry trends, costs, cash flows, or ongoing declines in market capitalization.
We evaluate our goodwill for impairment annually as of October 1 or earlier upon the occurrence of substantive unfavorable changes in economic conditions, industry trends, costs, cash flows, or ongoing declines in market capitalization.
In making this determination, we evaluate whether we or another party involved with the VIE (1) has the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) has the obligation to absorb losses of or receive benefits from the VIE that could be significant to the VIE. 51 If it is concluded that an entity is not a VIE, we consider our proportional voting interests in the entity and consolidate majority-owned subsidiaries in which a controlling financial interest is maintained.
In making this determination, we evaluate whether we or another party involved with the VIE (1) has the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) has the obligation to absorb losses of or receive benefits from the VIE that could be significant to the VIE.
The largest component of distribution revenue is comprised of linear distribution rights to our networks from cable, DTH satellite, and telecommunication service providers. We have contracts with distributors representing most cable and satellite service providers around the world, including the largest operators in the U.S. and major international distributors.
We have contracts with distributors representing most cable and satellite service providers around the world, including the largest operators in the U.S. and major international distributors.
Interest payments on our outstanding finance lease obligations are based on the stated or implied rate in our finance lease agreements. (See Note 12 to the accompanying consolidated financial statements.) Operating Lease Obligations We obtain office space and equipment under multi-year lease arrangements. Most operating leases are not cancellable prior to their expiration.
(See Note 12 to the accompanying consolidated financial statements.) Operating Lease Obligations We obtain office space and equipment under multi-year lease arrangements. Most operating leases are not cancelable prior to their expiration. Payments for operating leases represent the amounts due under the agreements assuming the agreements are not canceled prior to their expiration.
Six Flags Guarantee In connection with WM’s former investment in the Six Flags (as defined below) theme parks located in Georgia and Texas (collectively, the “Parks”), in 1997, certain subsidiaries of the Company agreed to guarantee (the “Six Flags Guarantee”) certain obligations of the partnerships that hold the Parks (the “Partnerships”) for the benefit of the limited partners in such Partnerships, including, annual payments made to the Parks or to the limited partners and additional obligations at the end of the respective terms for the Partnerships in 2027 and 2028 (the “Guaranteed Obligations”).
Unrecognized Tax Benefits Although we can reasonably estimate the total amount of unrecognized tax benefits related to certain of the Company’s uncertain tax positions that may decrease over the next twelve months, we are unable to reasonably predict the ultimate amount and timing of cash settlement with the respective taxing authorities. 47 Six Flags Guarantee In connection with the WarnerMedia Business’ former investment in the Six Flags (as defined below) theme parks located in Georgia and Texas (collectively, the “Parks”), in 1997, certain subsidiaries of the Company agreed to guarantee (the “Six Flags Guarantee”) certain obligations of the partnerships that hold the Parks (the “Partnerships”) for the benefit of the limited partners in such Partnerships, including annual payments made to the Parks or to the limited partners and additional obligations at the end of the respective terms for the Partnerships in 2027 and 2028 (the “Guaranteed Obligations”).
Senior Notes During the year ended December 31, 2023, we purchased or repaid $2,420 million of aggregate principal amount outstanding of our senior notes due in 2023 and 2024. In addition, we have $1,781 million of senior notes coming due in 2024.
Senior Notes During the year ended December 31, 2024, we repurchased or repaid $5,923 million of aggregate principal amount outstanding of our senior notes. In addition, we have $2,748 million of senior notes coming due in 2025. In February 2025, we redeemed in full $1,500 million aggregate principal amount of our 6.412% senior notes due 2026.
This also involves the use of significant estimates and assumptions with respect to the potential outcome of positions taken on tax returns that may be reviewed by tax authorities.
This also involves the use of significant estimates and assumptions with respect to the potential outcome of positions taken on tax returns that may be reviewed by tax authorities. Goodwill and Intangible Assets Goodwill is allocated to our reporting units, which are our operating segments or one level below our operating segments (the component level).
In December 2023, we acquired the remaining 65% of BluTV for $50 million. • Redeemable Noncontrolling Interest and Noncontrolling Interest Due to business combinations, we also had redeemable equity balances of $165 million at December 31, 2023, which may require the use of cash in the event holders of noncontrolling interests put their interests to us.
We contributed $109 million and $112 million in 2024 and 2023, respectively, for investments in and advances to our investees. • Redeemable Noncontrolling Interest and Noncontrolling Interest We had redeemable equity balances of $109 million at December 31, 2024, which may require the use of cash in the event holders of noncontrolling interests put their interests to us.
Notwithstanding the U.S. taxation of these amounts, we intend to continue to reinvest these funds outside of the U.S. Our current plans do not demonstrate a need to repatriate them to the U.S. However, if these funds were to be needed in the U.S., we would be required to accrue and pay non-U.S. taxes to repatriate them.
Our current plans do not demonstrate a need to repatriate them to the U.S. However, if these funds were to be needed in the U.S., we would be required to accrue and pay non-U.S. taxes to repatriate them. The determination of the amount of unrecognized deferred income tax liability with respect to these undistributed foreign earnings is not practicable.
Summarized Guarantor Financial Information Basis of Presentation As of December 31, 2023, the Company has outstanding senior notes issued by DCL, a wholly owned subsidiary of the Company, and guaranteed by the Company, Scripps Networks Interactive, Inc.
Summarized Guarantor Financial Information Basis of Presentation As of December 31, 2024, the Company has outstanding senior notes issued by Discovery Communications, LLC (“DCL”), which are guaranteed by the Company, Scripps Networks Interactive, Inc. (“Scripps Networks”), and WarnerMedia Holdings, Inc.
The table below presents our Adjusted EBITDA by segment (in millions).
(See Note 23 to the accompanying consolidated financial statements.) The table below presents our Adjusted EBITDA by segment (in millions).
Content expense includes television/digital series, specials, films, and sporting events. The costs of producing a content asset and bringing that asset to market consist of production costs, participation costs, and exploitation costs.
Content expense includes television/digital series, specials, films, games, and sporting events. Amortization related to both historical cost basis and any fair value adjustments to content arising from business combinations is included in costs of revenues. The costs of producing a content asset and bringing that asset to market consist of production costs, participation costs, and exploitation costs.
Our borrowing costs and access to capital markets can be affected by short and long-term debt ratings assigned by independent rating agencies which are based, in part, on our performance as measured by credit metrics such as interest coverage and leverage ratios. 45 The 2017 Tax Act features a participation exemption regime with current taxation of certain foreign income and imposes a mandatory repatriation toll tax on unremitted foreign earnings.
Our borrowing costs and access to capital markets can be affected by short and long-term debt ratings assigned by independent rating agencies which are based, in part, on our performance as measured by credit metrics such as interest coverage and leverage ratios. Credit rating agencies may continue to review and adjust our ratings or outlook.
Discovery, Inc.” On April 11, 2022, our shares started trading on Nasdaq under the trading symbol WBD. (See Note 3 and Note 4 to the accompanying consolidated financial statements.) Warner Bros. Discovery is a premier global media and entertainment company that provides audiences with a differentiated portfolio of content, brands and franchises across television, film, streaming, and gaming.
Discovery, Inc.” On April 11, 2022, our shares started trading on Nasdaq under the trading symbol WBD. (See Note 3 and Note 4 to the accompanying consolidated financial statements.) Warner Bros.
This discussion and analysis is intended to better allow investors to view the company from management’s perspective. 32 This section provides an analysis of our financial results for the fiscal year ended December 31, 2023 compared to the fiscal year ended December 31, 2022.
This section provides an analysis of our financial results for the fiscal year ended December 31, 2024 compared to the fiscal year ended December 31, 2023.
(See Note 6 to the accompanying consolidated financial statements.) Impairments and Loss on Dispositions Impairments and loss on dispositions was a $77 million and $117 million loss in 2023 and 2022, respectively. The loss in 2023 was primarily attributable to lease impairments and costs associated with our exit from AT&T SportsNets.
(See Note 12 to the accompanying consolidated financial statements.) The loss in 2023 was primarily attributable to lease ROU asset impairments and costs associated with our exit from AT&T SportsNets. Interest Expense, net Actual interest expense, net decreased $204 million in 2024, primarily attributable to lower debt during the period.
We have a $6.0 billion revolving credit facility and commercial paper program described below. We also participate in a revolving receivables program and an accounts receivable factoring program described below. • Debt Senior Notes During the year ended December 31, 2023, we issued $1.5 billion of 6.412% fixed rate senior notes due March 2026.
We also participate in a revolving receivables program and an accounts receivable factoring program described below. • Debt Senior Notes During the year ended December 31, 2024, we issued €650 million of 4.302% fixed rate senior notes due January 2030 and €850 million of 4.693% fixed rate senior notes due May 2033.
The Company uses this measure to assess the operating results and performance of its segments, perform analytical comparisons, identify strategies to improve performance, and allocate resources to each segment. The Company believes Adjusted EBITDA is relevant to investors because it allows them to analyze the operating performance of each segment using the same metric management uses.
Management believes that Adjusted EBITDA is an appropriate measure for evaluating the operating performance of the Company’s operating segments because it is the primary measure used by the Company’s chief operating decision maker to assess the operating results and performance of the segments, perform analytical comparisons, identify strategies to improve performance, and allocate resources to each segment.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeDuring the year ended December 31, 2023, we had access to a $6.0 billion multicurrency revolving credit facility. We had no outstanding borrowings as of December 31, 2023. We also have access to a commercial paper program, which had no outstanding borrowings as of December 31, 2023.
Biggest changeDuring the year ended December 31, 2024, we entered into a new $6.0 billion multicurrency revolving credit agreement, replacing the existing $6.0 billion multicurrency revolving credit agreement. We had no outstanding borrowings as of December 31, 2024. We also have access to a commercial paper program, which had no outstanding borrowings as of December 31, 2024.
The earnings of certain international operations are expected to be reinvested in those businesses indefinitely. The functional currency of most of our international subsidiaries is the local currency. We are exposed to foreign currency risk to the extent that we enter into transactions denominated in currencies other than our subsidiaries’ respective functional currencies (“non-functional currency risk”).
The earnings of certain international operations are expected to be reinvested in those businesses indefinitely. 53 The functional currency of most of our international subsidiaries is the local currency. We are exposed to foreign currency risk to the extent that we enter into transactions denominated in currencies other than our subsidiaries’ respective functional currencies (“non-functional currency risk”).
(See Note 13 to the accompanying consolidated financial statements.) 53 Market Values of Investments and Liabilities In addition to derivatives, we had investments in entities accounted for as equity method investments, equity investments, and other highly liquid instruments, such as money market funds and mutual funds, that are accounted for at fair value.
(See Note 13 to the accompanying consolidated financial statements.) Market Values of Investments and Liabilities In addition to derivatives, we had investments in entities accounted for as equity method investments, equity investments, and other highly liquid instruments, such as money market funds and mutual funds, that are accounted for at fair value.
Accordingly, we may experience a negative impact on our net income, other comprehensive (loss) income and equity with respect to our holdings solely as a result of changes in foreign currency. The majority of our foreign currency exposure is tied to Europe and Latin America.
Accordingly, we may experience a negative impact on our net loss, other comprehensive loss, and equity with respect to our holdings solely as a result of changes in foreign currency. The majority of our foreign currency exposure is tied to Europe and Latin America.
Most of our non-functional currency risks related to our revenue, operating expenses and capital expenditures were not hedged as of December 31, 2023. We generally do not hedge against the risk that we may incur non-cash losses upon the translation of the financial statements of our subsidiaries and affiliates into U.S. dollars.
Most of our non-functional currency risks related to our revenue, operating expenses, and capital expenditures were not hedged as of December 31, 2024. We generally do not hedge against the risk that we may incur non-cash losses upon the translation of the financial statements of our subsidiaries and affiliates into U.S. dollars.
The potential change in fair value of these senior notes from a 100 basis-point increase in quoted interest rates across all maturities, often referred to as a parallel shift in the yield curve, would be a decrease in fair value of approximately $2.9 billion as of December 31, 2023.
The potential change in fair value of these senior notes from a 100 basis-point increase in quoted interest rates across all maturities, often referred to as a parallel shift in the yield curve, would be a decrease in fair value of approximately $2.1 billion as of December 31, 2024.
The interest rate on borrowings under the revolving credit facility is based on a floating rate based on the applicable currency of the borrowing plus a margin. The revolving credit facility matures in June 2026, with the option for up to two additional 364-day renewal periods.
The interest rate on borrowings under the revolving credit facility is based on a floating rate based on the applicable currency of the borrowing plus a margin. The revolving credit facility matures in October 2029, with the option for up to two additional 364-day renewal periods.
As of December 31, 2023, we had $43.9 billion of fixed-rate senior notes, at par value. Our current objectives in managing exposure to interest rate changes are to limit the impact of interest rates on earnings and cash flows.
As of December 31, 2024, we had $39.5 billion of fixed-rate senior notes, at par value. Our current objectives in managing exposure to interest rate changes are to limit the impact of interest rates on earnings and cash flows.
(See Note 13 to the accompanying consolidated financial statements.) 52 As of December 31, 2023, the fair value of our outstanding senior notes, including accrued interest, was $40.5 billion. The fair value of our long-term debt may vary as a result of market conditions and other factors.
(See Note 13 to the accompanying consolidated financial statements.) As of December 31, 2024, the fair value of our outstanding senior notes, including accrued interest, was $34.9 billion. The fair value of our long-term debt may vary as a result of market conditions and other factors.

Other WBD 10-K year-over-year comparisons