Warner Bros. Discovery counts 117 million subscribers as streaming swings to a profit

Max is creating shareholder value, or whatever the finance bros say. Warner Bros. Discovery’s DTC unit, which houses the streamer, added 6.4 million global subscribers in Q424, according to the company’s quarterly earnings.

The DTC unit, which also includes Discovery+ and some niche streamers, counted 117 million global subscribers in total and 57 million domestic subscribers, the company reported. The company is aiming to hit 150 million global subscribers by the end of 2026, it disclosed in a shareholder letter published Thursday morning.

The company’s streaming business posted $409 million profit in Q424, compared to a $55 million loss in Q423, and over the course of the year, the business segment brought in $677 million in profit, more than six times that of the $103 million it brought in in 2023.

WBD has its ad-supported streaming tiers to thank for part of that growth: ad-tier signups helped drive advertising revenue up 27% in the three months ending December 31, according to the company. The amount of money the company earned per subscriber also inched up, with domestic ARPU increasing from $11.65 in Q423 to $11.77 in Q424.

With that said, the competition in the streaming world is still fierce.

“The global players will be…the largest sustainable-growth media companies,” WBD CEO David Zaslav said Thursday during the company’s earnings call.“There’ll probably be four or five or six, and our job every day is to fight to get a seat at that table.”

Join the fray: As peers like Comcast spin off their cable channels, WBD plans to report additional incremental guidance on growth of its global linear networks and streaming and studios separately beginning next quarter in an act of “self-consolidation,” CFO Gunnar Wiedenfels told investors Thursday. When asked about the potential for additional consolidation at WBD, Zaslav said consolidation and cross-company bundling could be in the company’s future.

“There’ll be a few global players. There may be some consolidation in getting there,” he said. “The consolidation may simply come with bundles, [and] as opposed to just being an economic bundle, [it] will be a consumer-friendly bundle where you can move between content from one [player] to another. We’re going to be a very, very attractive player. We’re already having a number of discussions, and we’ll just have to assess how strong we are alone.”

Play the hits: For WBD, franchises and tried-and-true IP are leading the pack and driving viewership. HBO series The Penguin, which premiered last fall, was among the top-three most-watched original series debuts on Max, the company said, and WBD is reviving other DC characters, including with a Superman tentpole movie release in July. The second episode of the third season of The White Lotus, meanwhile, brought in 3.4 million viewers last Sunday, according to Nielsen. There are other major tentpoles in the works, including the series It: Welcome to Derry, a prequel to the movie adaptations of Stephen King’s It, coming to screens later this year.

Beyond that, Max continues to expand to other countries, including a planned debut in Australia on March 31.

Other streamers like Netflix and Amazon Prime Video are doubling down on live sports opportunities, and while investment in sports will be a “pressure point,” Zaslav said, “the ability to really build a long-term platform on short-term sports rights has not been a good story in the past, and it’s unlikely to be a good story in the future.”

Cost of streaming: While Max is currently rolling out a password-sharing crackdown similar to those previously undertaken by Netflix and Disney, a price hike could also be in order, Zaslav suggested.

“The US is a pretty mature market. We think that there’s still some growth given the quality of our service,” he said. “A lot of the growth may come from price, as we play around with the quality of what we’re providing versus the cost of what we’re providing.”