Warner Bros. Plans to Reject Paramount's Revised Takeover Bid
"Now Streaming" is The Fly's weekly recap of the stories surrounding the biggest content streamers.PLAYING THIS WEEKEND:The most notable new content to watch on streaming this weekend is the two-hour finale of Netflixseries "Stranger Things," which became available on New Year's Day. Netflix subscribers can also catch thriller miniseries "Run Away," adapted from a novel by Harlan Coben and starring James Nesbitt.WARNER BROS./PARAMOUNT:plans to reject a revised takeover bid from Paramount Skydance, people familiar with the matter told Bloomberg's Lucas Shaw earlier this week, echoing earlier reporting from CNBC's David Faber. The Warner Bros. board hasn't made a final determination, but will meet next week, according to Bloomberg's report. Among the board's concerns is that Paramount Skydance has not yet updated its offer, which Warner Bros. previously dismissed as inferior to one from Netflix, the author noted.AMC "STRANGER THINGS":On Friday, AMC EntertainmentCEO Adam Aron said that screenings of Netflix's "Stranger Things" finale in 231 of its U.S. theaters on New Year's Eve and New Year's Day was "nothing less than an absolute triumph," with the theater operator collecting more than $15M in just two days from the showtimes."This unprecedented theatrical event was nothing less than an absolute triumph," Aron said. "In addition to the countless millions of people who will enjoy Stranger Things on the Netflix streaming platform, in just two days, more than 753,000 Stranger Things fans flocked to an AMC Theatre to personally join in the celebration. AMC had slightly more than one-third of the total theatre count showing the Stranger Things series finale, and AMC estimates that more than half of all Stranger Things fans who saw the series finale in a movie theater did so at an AMC. Consumer demand was so high that AMC repeatedly and exponentially added thousands of additional showtimes across its participating locations. In the end, AMC had more than nine times the available seating capacity allocated to Stranger Things than was originally envisioned. The admissions price was free, but required the mandatory purchase of a $20 per-person food and beverage credit. As a result, AMC collected more than $15.0 million in just two days from Stranger Things showtimes. At AMC, our company is excited about the prospect of taking more Netflix content to theatre goers, and I might add that the working relationship between the two companies in our two recent projects has been easy, creative, and seamless."NETFLIX NFL GAMES:Meanwhile, Netflix said on Wednesday that its second NFL Christmas Gameday contest between the Detroit Lions and Minnesota Vikings became the most-streamed NFL game in U.S. history with an average of 27.5M viewers in the U.S., with US viewership peaking at over 30M viewers, according to Nielsen Big Data + Panel. The Cowboys-Commanders game averaged 19.9M US viewers. Netflix has now distributed the top three most-streamed NFL games in U.S. history, the company said. Snoop Dogg's Holiday Halftime Party in the Lions-Vikings game brought in an average of 29M viewers in the US, according to Nielsen Big Data + Panel. Viewers from over 200 countries and territories tuned in to at least one of the games, with the Cowboys-Commanders drawing a 22.4M global AMA and the Lions-Vikings garnering a 30.5M global AMA. This year, NFL Christmas Gameday drove more than 632M global owned social impressions, with Snoop's Holiday Halftime Party driving over 100M impressions on Christmas Day. Additionally, Lions-Vikings was the most socially consumed sporting event on Christmas Day.STOCK PLAYS:Other publicly traded companies in the space include Disney, AmazonApple, FuboTV, Comcast, Fox, Roku, and AMC Networks.
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Netflix Reports Strong Q3 Earnings Amid Stock Volatility
- Strong Financial Performance: Netflix's Q4 revenue rose 17.6% year-over-year to $12.1 billion, with earnings per share climbing 30.2% to $0.56, demonstrating the company's robust performance in the streaming market and its ability to attract over 325 million paid subscribers.
- Stock Split Impact: The announcement of a 10-for-1 stock split provided a temporary boost, yet concerns over the proposed acquisition of Warner Bros. have led to a 27% decline in stock price over the past six months, reflecting market uncertainty about future prospects.
- Acquisition Potential: Netflix's plan to acquire Warner Bros. for $82.7 billion, while increasing debt, could unlock significant value by leveraging Warner's extensive content library alongside Netflix's data-driven content creation capabilities, presenting substantial growth opportunities.
- Market Competition and Opportunities: Despite fierce competition, Netflix remains a leader in the streaming sector, with management noting that it commands less than 10% of TV viewing time in its most advanced markets, indicating ample room for growth, making the current stock dip an attractive buying opportunity.
Netflix Reports Strong Earnings but Stock Drops
- Strong Earnings Report: Netflix's Q4 revenue exceeded $12 billion, marking an 18% year-over-year increase, with earnings per share at $0.56, slightly above Wall Street expectations, indicating stable performance in a mature market.
- Slower Growth Forecast: Management projects revenue growth for 2026 to be between 12-14%, down from 16% in 2025, raising investor concerns about future growth and causing the stock to drop approximately 5% post-earnings.
- Increased Content Investment: Netflix plans to boost content spending by 10% to $18 billion in 2026 to enhance its content library and maintain market competitiveness, although this will increase the company's debt burden.
- Acquisition Strategy Shift: Netflix amended its bid for Warner Bros. Discovery to an all-cash offer valued at approximately $72 billion, aiming to secure a vast content library, but this will raise its debt from $34 billion to $42 billion.
