One-glance verdict
Overvalued
$12.23 our estimate vs market $30.95
Wall Street consensus: $30.62 (150.5% higher than our fair-value estimate)
153% above our estimate, beyond the bull case
Fundamentals snapshot
Warner Bros. Discovery Inc
WBD · NMS · Communication Services · Entertainment
Current price
$30.95
52-week range
$18.00 - $30.99
Market cap
$77.60B
Balance sheet
Distressed
0.63x Concerning
Net debt $28.61B. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
1 Risk
1 rewards · 1 risks
- Reward Free cash flow was positive in 10/10 years.
- Risk Return on equity was -8.8% last year — the company lost money on shareholders' equity.
What this company does
Warner Bros. Discovery Inc
Warner Bros. Discovery is a big media company that makes and shows movies, TV shows, and other entertainment content through its streaming services like HBO Max and discovery+, its movie and TV production studios, and its various TV channels. The money it makes mainly comes from people paying for its streaming subscriptions and from advertising on its channels. Understanding how well these different parts of the business are doing, for example, looking at its profit margins (the percent of each sales dollar left after day-to-day business costs), is important because it shows if the company is making more money than it spends to create and deliver all its entertainment.
How the company got here
Warner Bros. Discovery (WBD) was formed in April 2022 through the merger of WarnerMedia, owned by AT&T, and Discovery, Inc. This combination brought together a vast library of film and television content with a strong portfolio of unscripted and lifestyle programming. The goal was to create a more powerful media giant capable of competing in the rapidly evolving streaming landscape. Previously, WarnerMedia itself was part of AT&T, a telecommunications company, which had acquired it in 2018 with the aim of integrating content with its mobile and broadband services. In October 2026, Skydance Corporation acquired a majority stake in Warner Bros. Discovery, marking another significant shift in its corporate ownership.
What it actually does
Warner Bros. Discovery is a global media and entertainment company. It creates, produces, and distributes a wide range of content, including movies, television shows, and digital media. Think of it as a giant content factory that then figures out the best ways to get that content to viewers, whether through movie theaters, television channels, or streaming services. The company owns many well-known brands and intellectual properties that form the basis of its entertainment offerings.
Studios
The Studios segment is where much of the magic happens, focusing on creating content. This includes producing blockbuster movies that you see in theaters and developing television shows for broadcast and streaming. It also involves licensing this content to other platforms and distributing films and shows across various markets, including physical media like DVDs and digital downloads. This part of the business is crucial for feeding content to the company's own streaming services and networks, as well as generating revenue from external sales and licensing deals. It also encompasses video game development and licensing for interactive platforms.
Global Linear Networks
This segment operates a variety of television channels that are still widely watched. These networks include general entertainment, lifestyle, and news channels, such as HBO, CNN, HGTV, and Food Network. These channels make money primarily through advertising revenue (money paid by companies to show commercials during programs) and affiliate fees (payments from cable and satellite providers for carrying the channels). While streaming is growing, these traditional networks still represent a significant portion of the company's overall business.
Streaming
The Streaming segment is where WBD offers its direct-to-consumer services, like HBO Max and discovery+. These platforms provide a subscription-based model where customers pay a monthly fee for access to a vast library of movies, TV shows, and original content. This is the company's primary battleground against other major streaming players. The success here depends on attracting and retaining subscribers by offering compelling content and a user-friendly experience.
What management is betting on now
Management is focused on integrating the various parts of the newly merged company and optimizing its content strategy across all platforms. A key priority is to make its streaming services profitable by carefully managing content costs and subscriber acquisition. They are also looking to leverage the company's extensive library of intellectual property, such as the DC Comics universe, to create new movies, shows, and experiences. The recent acquisition by Skydance Corporation suggests a new strategic direction aimed at streamlining operations and potentially unlocking further value from its diverse assets.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$632.00M
FY2024 Q4
$2.43B
FY2025 Q1
$302.00M
FY2025 Q2
$702.00M
FY2025 Q3
$701.00M
FY2025 Q4
$1.38B
FY2026 Q1
$-476.00M
FY2026 Q2
$572.00M
Revenue
$8.72B
Net income
$149.00M
Diluted EPS
0.06
Operating cash flow
$848.00M
Free cash flow
$572.00M
Fetching…
Sources
Revenue
$8.89B
Net income
$-2.92B
Diluted EPS
-1.17
Operating cash flow
$-208.00M
Free cash flow
$-476.00M
Fetching…
Sources
Revenue
$9.46B
Net income
$-252.00M
Diluted EPS
-0.10
Operating cash flow
$1.80B
Free cash flow
$1.38B
Fetching…
Sources
Revenue
$9.04B
Net income
$-148.00M
Diluted EPS
-0.06
Operating cash flow
$979.00M
Free cash flow
$701.00M
Fetching…
Sources
Revenue
$9.81B
Net income
$1.58B
Diluted EPS
0.63
Operating cash flow
$983.00M
Free cash flow
$702.00M
Fetching…
Sources
Revenue
$8.98B
Net income
$-453.00M
Diluted EPS
-0.18
Operating cash flow
$553.00M
Free cash flow
$302.00M
Fetching…
Sources
Revenue
$10.03B
Net income
$-494.00M
Diluted EPS
-0.20
Operating cash flow
$2.71B
Free cash flow
$2.43B
Fetching…
Sources
Revenue
$9.62B
Net income
$135.00M
Diluted EPS
0.05
Operating cash flow
$847.00M
Free cash flow
$632.00M
Fetching…
Sources
Is it cheap or expensive?
Fair value $12.23 vs current price $30.95
Wall Street consensus is the average analyst price target: $30.62 (150.5% higher than our fair-value estimate).
Our most-likely fair value is $12.23 a share — about 60.5% below today's price of $30.95, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Distressed
Net debt $28.6B. Interest coverage 0.6x.
Net debt
$28.61B
Interest coverage
0.63x
Warner Bros. Discovery Inc's profit covers its interest bill about 0.6 times over. and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Distressed
Worse cushion
Baseline
Better cushion
WBD
BASELINE
Warner Bros. Discovery Inc
Total debt $32.02B Interest coverage 0.63x This is the baseline the peer rows are being compared against.
Total debt $46.04B Interest coverage 7.63x +1,116% vs WBD Carries about 12.2x more debt cushion than WBD.
Total debt $16.65B Interest coverage 17.16x +2,634% vs WBD Carries about 27.3x more debt cushion than WBD.
Total debt $90.38B Interest coverage 4.69x +647% vs WBD Carries about 7.5x more debt cushion than WBD.
Total debt $6.77M Interest coverage -7.74x -100% vs WBD This peer has almost no interest-payment cushion compared with WBD.
Total debt $7.57B Interest coverage 8.72x +1,289% vs WBD Carries about 13.9x more debt cushion than WBD.
What you should know
The case for and against WBD
1 Reward
1 Risk
Rewards
-
Free cash flow was positive in 10/10 years.
Risks
-
Return on equity was -8.8% last year — the company lost money on shareholders' equity.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
-1,238.00x
P/B
2.36x
P/S
2.15x
EV/EBITDA
13.79x
PEG ratio
55.18x
Profitability
How much profit each dollar creates
Gross margin
47.8%
Operating margin
5.1%
Net margin
-8.8%
ROE
-8.8%
ROA
1.7%
Health
Liquidity and balance-sheet strength
Debt / equity
0.94x
Current ratio
0.78x
Quick ratio
0.41x
Total debt
$32.02B
Total cash
$3.41B
Growth
How the business has been compounding
Revenue TTM
$36.12B
Revenue 5Y CAGR
32.3%
EPS TTM
-1.28
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$3.42B
Free CF TTM
$3.09B
FCF margin
8.6%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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