Under a Paramount-WBD merger, two struggling media giants would unite

Netflix has dropped out of the bidding war for Warner Bros. Discovery (WBD), making Paramount Skydance the expected owner of WBD. A Paramount-WBD merger remains subject to regulatory approval, but it’s likely that we will see a Paramount-Skydance-Warner-Bros.-Discovery media giant.

Such a conglomerate would unite two legacy media companies that have struggled with profitability for years and have strongly invested in streaming and cable.

With Paramount inching closer to WBD ownership, let’s look at what the union implies for streaming and cable.

A tale of two struggling businesses

Over the past few years, both WBD and Paramount have seen declining revenue and struggled with profitability, as summarized in the table below, leading to WBD becoming eager for a sale and Paramount throwing mountains of money at media mergers.

Paramount’s financial difficulties, combined with heavy reliance on the declining linear networks, are why analysts like Laura Martin, who covers entertainment and Internet at Needham & Company, say that Paramount “must have” WBD. Paramount is betting that the merger will lead to more consistent profitability by getting its streaming business out of the red and through content creation, theatrical releases, and licensing, as well as by deriving more value from its cable business.

HBO Max may become part of Paramount+

Paramount+ isn’t profitable. However, Paramount’s overall streaming business, including Pluto and BET+, has been narrowing losses. In Q4 2025, Paramount’s streaming business posted adjusted operating income before depreciation and amortization (OIBDA) of minus-$158 million (Paramount didn’t share full-year figures). Paramount+ grew revenue 17 percent year over year (YoY) and subscribers from 77.9 million in Q3 to 78.9 million.

WBD’s streaming business, per the company’s full-year 2025 earnings report, made $393 million adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA), down from $409 million for 2024. WBD ended the year with 131.6 million streaming subscribers across HBO and Discovery+. WBD doesn’t break out numbers based on streaming service, but most of its streaming business is tied to HBO Max.

For comparison, Netflix, the largest subscription video-on-demand provider, reported net income of $11 billion for 2025. Netflix last reported its subscriber count at 301.6 million in January 2025.

For subscribers, the most obvious potential outcome is for HBO Max to become part of the Paramount+ streaming service. In November, Bloomberg, citing unnamed people familiar with the plans of Paramount CEO David Ellison, said that the executive would merge HBO Max “into the existing Paramount+ platform” because he thinks “combining the offerings will allow more people to see the work of film and TV show creators” and would be more “compelling” to subscribers.

A Paramount+ that encompasses titles from WBD would be larger and more valuable and, therefore, likely command higher subscription prices. Although Vikrant Mathur, co-founder of streaming technology provider Future Today, noted in an email to Ars Technica that “in the near term, it’s plausible that HBO Max and Paramount+ remain distinct brands but are offered in discounted bundles.”

Paramount could also fold Discovery+ or the CNN streaming service into Paramount+, but it hasn’t provided specific plans. An app that unifies Paramount+ with other streaming libraries could make finding content easier if it’s executed well.