Netflix is no longer interested in bidding for Warner Bros. Discovery

The battle for ownership of Warner Bros. Discovery now seems to be over after Netflix pulled out of the bidding war.

The announcement came after Warner Bros said that it considered Paramount’s bid to be superior, inviting Netflix to increase its offer.

While Netflix was given time to consider its position and decide to up its bid, the company decided that this move would not be in its interest.

The Warner Bros announcement reads:

Warner Bros. Discovery, Inc. (“WBD”) (NASDAQ: WBD) today announced that its Board of Directors (the “Board”), following consultation with its independent financial and legal advisors, has determined that the previously disclosed proposal from Paramount Skydance Corporation (“PSKY”) (NASDAQ: PSKY) constitutes a “Company Superior Proposal” as defined in WBD’s merger agreement with Netflix, Inc. (“Netflix”) (NASDAQ: NFLX).

As disclosed by WBD on February 24, 2026, PSKY’s proposal includes a purchase price of $31.00 per WBD share in cash, plus a daily ticking fee equal to $0.25 per share per quarter beginning after September 30, 2026, as well as a $7 billion regulatory termination fee payable by PSKY in the event the transaction does not close due to regulatory matters, payment by PSKY of the $2.8 billion termination fee that WBD would be required to pay to Netflix to terminate the existing Netflix merger agreement, an obligation of Larry J. Ellison and an associated trust to contribute additional equity funding to the extent needed to support the solvency certificate required by PSKY’s lending banks, and a “Company Material Adverse Effect” definition that excludes the performance of WBD’s Global Linear Networks segment.

WBD has notified Netflix of its determination that the PSKY proposal constitutes a “Company Superior Proposal.” Under the terms of the Netflix merger agreement, this notice triggers a four business day period during which Netflix has the right to propose revisions to the Netflix merger agreement so that the PSKY proposal would cease to constitute a “Company Superior Proposal.” Following the conclusion of this period, if the Board determines in good faith, after consultation with its independent financial and legal advisors, that, after considering any revisions to the terms of the Netflix merger agreement proposed by Netflix, the PSKY proposal continues to constitute a “Company Superior Proposal,” WBD would be entitled to terminate the Netflix merger agreement.

The Netflix merger agreement remains in effect, and the Board continues to recommend in favor of the Netflix transaction and has not withdrawn or modified its recommendation.

Allen & Company, J.P. Morgan and Evercore are serving as financial advisors to Warner Bros. Discovery and Wachtell, Lipton, Rosen & Katz and Debevoise & Plimpton LLP are serving as legal counsel.

Netflix, however, is not interested. Indicating its decision to back out, the streaming giants says:

The transaction we negotiated would have created shareholder value with a clear path to regulatory approval. However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.

Warner Bros. is a world-class organization, and we want to thank David Zaslav, Gunnar Wiedenfels, Bruce Campbell, Brad Singer and the WBD Board for running a fair and rigorous process. We believe we would have been strong stewards of Warner Bros.’ iconic brands, and that our deal would have strengthened the entertainment industry and preserved and created more production jobs in the U.S.  But this transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.

Netflix’s business is healthy, strong and growing organically, powered by our slate and best-in-class streaming service. This year, we’ll invest approximately $20 billion in quality films and series and will expand our entertainment offering. Consistent with our capital allocation policy, we’ll also resume our share repurchase program.

We will continue to do what we’ve done for more than 20 years as a public company: delight our members, profitably grow our business, and drive long-term shareholder value.