Paramount Skydance (PSKY) reportedly lost the race to acquire Warner Bros. Discovery (WBD) as reports indicate that WBD has entered exclusive negotiations with Netflix (NFLX) to sell its film and TV studios and HBO Max streaming service. Paramount, Netflix, and Comcast (CMCSA) had submitted their second round of “improved bids” on December 1, and Netflix, with its “mostly cash offer,” has emerged as the winner. The two could announce a deal soon, with WBD continuing its planned split into Warner Bros. and Discovery Global, which is expected to complete in April.
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Paramount, led by David Ellison, seems upset and accuses WBD of tainting the sale process to favor Netflix. A deal combining Netflix with WBD’s studios and streaming service could dramatically reshape the entertainment and media industry. As of early 2025, Netflix boasted about 301.6 million global subscribers, HBO Max roughly 116 million, and Paramount+ about 79 million subscribers.
Paramount Cries Foul in the WBD Sale Process
On December 1, Paramount sent a letter to WBD’s lawyers stating that a sale to Netflix would be highly unlikely due to high regulatory scrutiny in the U.S. and overseas. On December 3, Ellison wrote to Warner Bros. CEO David Zaslav, accusing the company of abandoning “the semblance and reality of a fair transaction.” In response, Warner said it would fulfill its fiduciary duties with the utmost care and would continue to do so.
Netflix’s Warner bid has drawn concern among some lawmakers that HBO Max could tilt the streaming market, though the Justice Department has not formally reviewed the deal. Netflix argues the market extends beyond subscriptions to free platforms like YouTube (GOOGL), Facebook (META), and TikTok, and maintains that even if limited to subscription services, HBO Max would not hurt competition. The strategy is that bundling could lower prices versus separate sales, and many HBO Max subscribers also pay for Netflix.
Paramount Loses the Bidding War
Rumors that Netflix offered the highest cash bid prompted Paramount to push back. Paramount raised its breakup fee from $2.1 billion to $5 billion to influence Warner Bros.’ decision, though Netflix has reportedly offered the same breakup fee.
Paramount also stated that it had the easiest path to regulatory approval compared with Comcast and Netflix. Warner Bros. Discovery hopes to close the deal before Christmas. Paramount was seen as the best option since it was the only player willing to acquire the entire WBD, while Comcast and Netflix were focused on WBD’s movie and TV studios and HBO Max.
PSKY, CMCSA, NFLX: Which Is the Best Media Stock, According to Analysts?
We used the TipRanks Stock Comparison Tool to determine which media company is currently preferred by analysts.
Analysts have assigned a “Strong Buy” consensus rating on NFLX stock, which offers the highest upside potential among them. Conversely, Wall Street remains more cautious about the long-term outlook of Comcast and Paramount Skydance shares.
