Warner Bros. Discovery, Inc. (the “Company”) (Nasdaq: WBD) today reported financial results for the quarter ended March 31, 2023.
David Zaslav, President and Chief Executive Officer of Warner Bros. Discovery said, “It is an important time for Warner Bros. Discovery. We’ve come through some major restructurings and have repositioned our businesses with greater precision and focus. And we see a number of positive proof points emerging, with DTC perhaps the most prominent. We made a meaningful turn this quarter with $50 million in segment EBITDA and 1.6 million net adds, and we feel great about the trajectory we are on. In fact, we now expect our U.S. DTC business to be profitable for 2023 – a year ahead of our guidance. Even in today’s challenging marketplace, we are positioned to drive free cash flow and deleverage our balance sheet, and we remain confident in our strategy and ability to achieve our financial targets.”
Q1 Financial Summary & Operational Highlights:
- Q1 total revenues were $10,700 million. Revenues decreased 5% ex-FX, or decreased 3% ex-FX excluding the impact of the 2022 Winter Olympic Games, compared to the prior year quarter, on a combined basis.
- Net loss available to Warner Bros. Discovery, Inc. was $(1,069) million, and included $1,810 million of pre-tax amortization from acquisition-related intangible assets and $95 million of pre-tax restructuring expenses.
- Q1 total Adjusted EBITDA was $2,611 million. Adjusted EBITDA increased 12% ex-FX compared to the prior year quarter, on a combined basis.
- Q1 cash provided by operating activities and reported free cash flow are not directly comparable to the prior year quarter due to the acquisition of the WarnerMedia business.
- Cash provided by operating activities was $(631) million, which includes $836 million of semi-annual interest payments largely attributable to merger-related debt.
- Reported free cash flow was $(930) million.
- Ended Q1 with $2.6 billion of cash on hand, $49.5 billion of gross debt, and 5.0x net leverage.
- Global DTC subscribers increased 1.6 million to 97.6 million at the end of Q1 vs. 96.1 million subscribers at the end of Q4.
- In Q1, WBD was the #1 most-watched Total TV linear portfolio among P25-54 viewers, driven by the broadcast of the NCAA March Madness tournament, and had 6 of the top 10 cable networks in Prime.
- Celebrated CNN’s first ever Oscar® with Navalny winning best documentary feature film.
- The Q1 launch of Hogwarts Legacy was the largest release of all time for Warner Bros. Games and is the best selling game year-to-date with over $1 billion in retail sales.
