Warner Bros. Discovery Eyes a New Spinoff Company on the Horizon

It sounds like Discoveryco. may be a reality.

CNBC’s David Faber stated on Thursday that Warner Bros. Discovery is “leaning toward…a separation,” as part of their latest financial report released shortly after the firm’s quarterly earnings data and discussions with Wall Street analysts. Faber further noted, “It has become quite evident to me through numerous talks I have conducted that we might see an announcement soon indicating their intention to attempt splitting up the business.”

Faber stated that it is “highly likely” Warner Bros. studios will be coupled with Max, making WBD’s cable networks the outlier assets. This move mirrors precisely what NBCUniversal is implementing for Faber.

A spokesperson for Warner Bros. Discovery did not immediately respond to
The Hollywood Reporter
Request for comments regarding the Faber report.

NBCU is spinning off most of its cable assets – minus Bravo and including CNBC – into a new company
now called Versant
(fka “SpinCo.”) and led by Mark Lazarus. Digital assets like the Golf Now app, Rotten Tomatoes and Fandango will also be
part of Versant
Almost instantly following the initial announcement about SpinCo, media analysts and journalists started questioning whether Warner Bros. Discovery would follow suit—and whether Skydance Paramount would promptly emulate this move once their merger was approved. In July 2023, Disney’s CEO Bob Iger stated publicly that his company’s traditional television networks, such as ABC, ”
may not be core
” to the company; he’s since walked that back.

In December, Warner Bros. Discovery started restructuring its organizational setup into a worldwide linear television department distinct from its streaming and studio divisions. This realignment was intended to enhance their “strategic adaptability and generate possible chances to uncover extra shareholder value,” as stated in an official company document released then.
The initiative
Is anticipated to wrap up around mid-2025 — can you tell which part of 2025 we’re getting close to?

“They’ve already done all of the reapportioning necessary,” Faber said. “And I would note as well, in their earnings report, for the first time, they break out every segment in its own financials. That is usually a tell, right? Streaming has its own page, studios and linear, global linear segments, network segment as well.”

What is WBD awaiting then? It still has around $35 billion in debt to allocate across Warner Bros.’ core operations and Discovery.

“It will require quite some time before this actually occurs,” Faber stated.

WBD came into existence only a few years ago through the merger of David Zaslav’s Discovery, Inc. and AT&T’s WarnerMedia.