Save up to 74%
Subscribe to Kiplinger
Shares of Warner Bros. Discovery (WBD) rose Thursday afternoon as investors analyze the company’s first-quarter earnings report and the announcement of a streaming package with Walt Disney (DIS).
During the quarter ended March 31, Warner Bros. profit. Discovery declined 7% year over year to $9. 96 billion. Its percentage-consistent loss is 40 cents, down from a loss of 44 cents last year.
Free money (FCF), which is money left over after a company has paid expenses, debt interest, taxes, and long-term investments to grow its business, showed a major improvement, reaching a positive $390 million, compared to $930. Negative millions. Millions a year ago.
Be a smarter, smarter investor.
“We are pleased with our progress in the first quarter, as evidenced by the strong effects achieved on KPIs,” said David Zaslav, CEO of Warner Bros. Discovery, in a press release. What happens is that once we return we generate a strong flow of free cash, even in our weakest FCF quarter of the season.
The effects of the first quarter did not meet analysts’ expectations. According to CNBC, Wall Street expects a profit of $10. 2 billion and a loss of 24 cents, in line with its share.
The bright spot for Warner Bros. Discovery is its Max streaming unit, which saw its profits grow “modestly” to about $2. 5 billion, thanks to a 69. 9% increase in advertising profits to $175 million. The unit added 2 million subscribers last quarter to bring its total to 99. 6 million.
“We will soon roll out Max to 29 countries across Europe, and the range of content for Max over the next year is one of the most comprehensive yet,” said Zaslav. “Warner Bros. Pictures also had a strong start to the year as the first studio to hit $1 billion at the box office and internationally, and they have a big project in the works. “
Another Warner Bros. Discovery expansion engine is the new streaming package that includes the Disney Plus and Hulu platforms of Max and Disney.
The deal was announced on Wednesday, May 8 and will be available in both ad-supported and ad-supported packages.
The package creates “the opportunity to drive incremental subscriber growth,” Zaslov said on today’s earnings call, adding that “this product will help increase retention and reduce churn and therefore contribute to superior values. ” useful life for customers. to have this summer.
Warner Bros. Discovery shares have been down 30% in 2024. However, analysts are positive on media services stocks.
According to S
Joey Solitro is a freelance money journalist at Kiplinger with over a decade of experience. A long-time equity analyst, Joey has covered a variety of sectors for the media, including The Motley Fool, Searching Alpha, Market Realist, and TipRanks. Joey has a bachelor’s degree in business administration.