Netflix Welcomes Warner Bros. Discovery Board Recommendation

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Netflix Welcomes Warner Bros. Discovery Board Recommendation

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17 December 2025

Global

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After Careful Review, Warner Bros. Discovery Board Urges Stockholders to Approve Netflix Agreement, Calling it the Best Option for Long-Term Value

Ted Sarandos and Greg Peters Send Letter to Warner Bros. Discovery Stockholders

Visit NetflixWBtogether.com for More Information on How Netflix and Warner Bros. Will Define the Next Century of Storytelling

HOLLYWOOD, Calif., Dec. 17, 2025 -- Netflix, Inc. today welcomed the recommendation from the Warner Bros. Discovery (WBD) Board of Directors for stockholders to reject the unsolicited offer from Paramount Skydance Corporation (PSKY), launched on December 8, 2025. After careful review with independent financial and legal advisors, the WBD Board urged stockholders to approve the merger agreement with Netflix, which they believe offers a more certain and superior alternative for WBD stockholders.

On December 5, Netflix and WBD announced a fully negotiated and financed definitive agreement under which Netflix will acquire Warner Bros., including its film and television studios, HBO Max and HBO. The cash and stock transaction is valued at $27.75 per WBD share, with a total enterprise value of approximately $82.7 billion (equity value of $72.0 billion). In addition, the transaction will provide WBD stockholders with incremental value from the previously announced separation of WBD's Global Linear Networks business, Discovery Global, which is planned for Q3 2026.

The Warner Bros. Discovery Board reinforced that Netflix's merger agreement is superior and that our acquisition is in the best interest of stockholders, said Ted Sarandos, Netflix co-CEO. This was a competitive process that delivered the best outcome for consumers, creators, stockholders and the broader entertainment industry. Netflix and Warner Bros. complement each other, and we're excited to combine our strengths with their theatrical film division, world-class television studio, and the iconic HBO brand, which will continue to focus on prestige television. We're also fully committed to releasing Warner Bros. films in theaters, with a traditional window, so audiences everywhere can enjoy them on the big screen.

Netflix co-CEO Greg Peters continued: "By acquiring Warner Bros., we'll be able to offer audiences and creators around the world even more choice, value and opportunity. This transaction is fundamentally pro-consumer, pro-innovation, pro-creator and pro-growth. Together we will deliver an even broader selection of great series and films that audiences can watch at home and in theaters, while driving long-term value for our stockholders. We're excited to begin this new chapter and continue to entertain and delight fans around the world."

Netflix has a long history of investing in creativity and partnering with top talent, and we're committed to honoring and growing Warner Bros.' incredible brands and franchises. By joining forces to combine our strengths and our passion for great storytelling, we'll strengthen the entertainment industry.

Our focus remains on creating outstanding films and shows, investing in the future of entertainment, and delivering more of what audiences love around the world.

The full text of Netflix's letter to WBD stockholders is below.

December 17, 2025

Dear Warner Bros. Discovery Stockholders,

Today the Warner Bros. Discovery ( WBD ) Board sent a clear message to you, their stockholders. The WBD Board urges you to reject Paramount Skydance's ( PSKY ) unsolicited, inferior and illusory tender offer.

After a robust and highly competitive strategic review process, the WBD Board had already recommended the transaction with Netflix. Today they have reaffirmed that this transaction is the best and most certain path forward for WBD and its stockholders and therefore recommend you vote to approve the Netflix Merger when the WBD stockholder meeting is convened.

We want to reiterate why we believe the agreed-upon transaction with Netflix is the right deal, with the right partner, at the right time - and to set the record straight on some key points. Here's why our transaction is superior on multiple fronts:

Superior financing certainty and clear funding structure: Our deal structure is clean and certain, with committed debt financing from leading institutions. There are no contingencies, no foreign sovereign wealth funds, and no stock collateral or personal loans. We are a scaled company with a +$400 billion market cap and a strong investment grade balance sheet. As WBD said, the PSKY offer has numerous risks and uncertainties associated with it, among which are PSKY's financial condition and creditworthiness.

Confidence in regulatory approvals: We plan to close the transaction in 12-18 months, after completing customary regulatory approvals. Netflix has submitted its HSR filing and is engaging with competition authorities, including the DOJ and EU Commission. Our financing structure is not subject to review by the Committee on Foreign Investment in the United States (CFIUS). Our $5.8 billion reverse termination fee, which is the largest cash regulatory termination fee in a public M&A transaction, shows our confidence in our ability to obtain required regulatory approvals.

Less risk and greater flexibility for WBD stockholders: Our offer provides flexibility for WBD to run its business between now and close, as well as facilitate the separation of Discovery Global quickly, as previously determined by the WBD board to be the right strategic direction that ensures continued stockholder value creation. In contrast, PSKY's offer puts substantial limitations on WBD's operations between sign and close and requires WBD to abandon its planned

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