The news: Netflix will officially acquire Warner Bros. Discovery’s (WBD) streaming and studio assets in an $82.7 billion deal, the company announced Friday morning, after five weeks of speculation. Netflix stated it has secured $59 billion in financing from a collection of banks to finalize the deal.

• Netflix claims it will maintain WBD’s theatrical operations and argues that combining Netflix’s distribution scale with Warner Bros.’ IP library will expand creative opportunities, broaden audience reach, and deliver $2 billion to $3 billion in annual cost savings.
• WBD shareholders will receive $23.25 in cash plus $4.50 in Netflix common stock for every WBD share they own.
• Netflix offered a strategic rationale for the move, stating the acquisition will offer consumers more choice, expand studio operations, and create better value for shareholders and talent.
• WBD’s linear networks are still set to be spun out from the company next year in a global networks company that will include CNN, Discovery, and TNT.

What Netflix gains: The deal stands to significantly strengthen Netflix’s competitive positioning in a market where it’s already a global leader.

• Netflix gains access to WBD’s vast catalog that brings premium content from HBO Max, Warner Bros. Pictures, and Discovery. This boosts Netflix’s offering of high-quality, long-tail programming—likely leading to increased viewing hours and an enhanced reputation for premium storytelling.
• The streamer will simultaneously benefit from increased ad inventory and revenue potential. Integrating WBD’s content with Netflix’s growing ad-supported tier will offer greater ad impressions across diverse audiences, strengthening Netflix’s case for premium CPMs and attracting advertisers seeking contextual alignment and prestige placements.
• Netflix’s massive subscriber base combined with WBD’s strong IP will consolidate unmatched subscription scale and strengthen Netflix’s theatrical pipeline—meaning the company can better rival players like Disney.