Today, Warner Bros. Discovery reported that it lost 700,000 MAX and Discovery+ during the 3rd quarter of 2023. Yet the good news was that Warner Bros. Discovery’s stream services earned $111 million with adjusted EBITDA. Over all, it is hoped that Max will soon break even or become profitable soon. This all comes as MAX added CNN Max and its new live sports, Bleacher Report that is currently free but will be a shared feature next year.
“I am very pleased with the strong financial results that our company delivered in Q3, underscored by 22% growth in Adjusted EBITDA and over $2 billion in free cash flow, putting us on track to meaningfully exceed $5 billion for the year and contributing to our nearly $12 billion in debt paydown to date. Among the highlights, our Direct-to-Consumer business had another profitable quarter with $111 million of Adjusted EBITDA and launched its new live-programming offerings with CNN Max and the Bleacher Report Add-On, which are showing early signs of contributing to increased engagement and lower churn on Max. We’ve made great strides in just 19 months and are excited to continue building on this strong momentum, as we focus on driving future growth and creating long-term value for our shareholders.” Said David Zaslav President and Chief Executive Officer of Warner Bros. Discovery.
Overall it was a good quarter for Warner Bros. Discovery as revenues went up 1% thanks to hits like Barbie that continued to earn through the 3rd quarter of 2023. It was also able to repay $2.4 billion of its debt, helping it cut back on what has been a massive amount of debt.
Q3 Financial Summary & Operational Highlights:
- Q3 total revenues were $9,979 million. Revenues increased 1% ex-FX compared to the prior year quarter.
- Net loss available to Warner Bros. Discovery, Inc. was $(417) million, and included $1,758 million of pre-tax amortization driven by acquisition-related intangibles and $269 million of pre-tax restructuring expenses.
- Q3 total Adjusted EBITDA was $2,969 million. Adjusted EBITDA increased 22% ex-FX compared to the prior year quarter.
- Cash provided by operating activities increased to $2,516 million. Reported free cash flow increased to $2,059 million.
- Repaid $2.4 billion of debt during Q3. Ended the quarter with $2.4 billion of cash on hand, $45.3 billion of gross debt, and 4.2x net leverage.
- Global DTC subscribers decreased 0.7 million to 95.1 million at the end of Q3 vs. 95.8 million subscribers at the end of Q2. Global DTC ARPU was $7.82, a 6% ex-FX increase vs. the prior year quarter.
- Barbie was the highest grossing film in Warner Bros. history, generating nearly $1.5 billion in global box office.
- The Nun II was the 6th film in The Conjuring Universe to cross $250 million in global box office. As a franchise, The Conjuring Universe has grossed nearly $2.3 billion globally, the most of any horror franchise.
- Successfully launched news streaming service, CNN Max, in the U.S., on September 27th, ahead of the October 5th launch of the Bleacher Report Sports Add-On tier.