Kristina Roberts
The first three months of 2025 were not easy for Warner Bros Discovery. The company made less money than experts had predicted, mainly because their movies did not perform as well as expected in theaters. Another big problem was that fewer people are watching cable TV these days, choosing streaming services instead. This shift has hurt their traditional TV business, including popular channels like CNN and Discovery.
Last year, the company had a huge hit with Dune: Part Two, which earned over $700 million worldwide. But this year, their big release, a sci-fi comedy called Mickey 17, barely made enough to cover its production costs. Because of this, the money earned from their movie division dropped by nearly 20%, falling far short of what analysts had hoped for.
However, things started looking better in the second quarter. A horror film called Sinners and A Minecraft Movie—which has already made around $900 million—helped turn things around. The company is also hopeful about its upcoming summer releases, especially Superman, directed by a filmmaker known for successful superhero movies.
TV Networks Struggle as Viewers Move to Streaming
The decline in cable TV viewers continues to be a major challenge. Advertising revenue dropped by 12% because companies are spending less on TV commercials. More and more people are canceling their cable subscriptions, preferring to watch shows and movies online instead.
Even with these struggles, there was some good news. The company’s streaming service, Max, gained over 5 million new subscribers, much more than expected. Hit shows like the third season of The White Lotus and a new medical drama called The Pitt helped attract viewers.
Warner Bros Discovery has also been expanding its streaming service to new countries, including Australia earlier this year. Last year, it launched in over 70 countries across Europe and Asia. Another smart move was offering a bundle that includes Max along with other popular streaming services, which has helped keep customers from canceling their subscriptions.
Financial Results Fall Short of Expectations
Overall, the company’s revenue for the first quarter dropped by 10% compared to last year. They lost more money per share than analysts had predicted, even though they managed to cut costs by nearly 12%. When these results were announced, the company’s stock price dipped slightly in early trading.
The entertainment industry is going through big changes. With fewer people watching cable TV, companies like Warner Bros Discovery must rely more on streaming and blockbuster movies to stay profitable. While this quarter was disappointing, the strong start to the second quarter gives some hope that things could improve.
The success of A Minecraft Movie and the upcoming Superman film could help the company bounce back. At the same time, their streaming service is growing, which is crucial as more viewers move away from traditional TV. The next few months will be important in determining whether Warner Bros Discovery can overcome these challenges and return to stronger financial performance.
Looking Ahead: Can Warner Bros Discovery Recover?
The company has a lot riding on its upcoming movie releases and the continued growth of its streaming platform. If Superman becomes a hit and more people sign up for Max, the second half of 2025 could be much better than the first.
Still, the bigger problem remains—the decline of cable TV. As more viewers switch to streaming, the company will need to keep producing must-watch shows and movies to stay competitive. The bundle deal with other streaming services seems to be working, and expanding into new markets could also help bring in more subscribers.
For now, Warner Bros Discovery is facing tough times, but there are signs that better days could be ahead. The key will be whether their new movies and streaming strategy can make up for the losses in their traditional TV business. If they succeed, the company could regain its footing in the fast-changing world of entertainment.
