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Warner Bros Discovery Eyes Potential Breakup Amid Revenue Miss and Cable Decline

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Warner Bros Discovery (WBD) is reportedly moving toward a potential company breakup, according to CNBC, as it looks to shed its struggling cable TV division and concentrate on faster-growing streaming and studio segments. The news sent WBD shares climbing over 4%, partially offsetting a sharp 6% drop earlier in the day following disappointing Q1 earnings.

The strategic shift comes as the broader media industry undergoes a profound transformation. Cord-cutting continues to erode the profitability of traditional cable networks, pushing media giants like WBD to reevaluate their core assets. WBD, which was formed through the 2022 merger of Warner Media and Discovery, had already taken initial steps in December by operationally separating its cable TV division from its studio and streaming units.

KEY FINANCIAL HIGHLIGHTS:

  • Revenue: Fell 10% YoY to $8.98 billion, missing analyst expectations of $9.60 billion.

  • Earnings: Posted a wider-than-expected loss of $0.18 per share versus the forecasted $0.13 loss.

  • Studio revenue: Dropped 18% to $2.31 billion, missing the $2.73 billion consensus.

  • Cable networks revenue: Declined 7%.

  • Streaming performance: A bright spot, with Max adding 5.3 million subscribers, beating estimates and bringing its total base to 122.3 million.

CEO David Zaslav highlighted Max’s continued appeal in the competitive streaming space, driven by strong programming like The White Lotus and The Pitt. Still, the studio division underperformed due to weak box office results — most notably the underwhelming performance of Mickey 17, which failed to replicate the success of Dune: Part Two.

On a more optimistic note, Q2 appears to be off to a better start. WBD’s latest theatrical releases — Ryan Coogler’s Sinners and A Minecraft Movie — have garnered major success, with the latter earning nearly $900 million globally and becoming 2025’s biggest box office hit to date.

A potential split would align WBD with peers like Comcast, which is also spinning off traditional cable properties in favor of a more streamlined digital content model. However, analysts caution that divesting cable assets could be challenging due to WBD’s heavy debt burden of $38 billion and the declining appeal of linear TV.

“WBD would be leaner and have stronger growth potential without cable assets,” noted eMarketer’s Ross Benes. “But finding a buyer could be difficult.”

While Warner Bros Discovery has yet to comment on the breakup report, the path toward separation could reshape its future trajectory as it competes for relevance and revenue in an increasingly digital-first entertainment industry.

Intel Shareholders Approve CEO Compensation and Equity Incentive Plan Amid Leadership Shift

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Intel shareholders on Tuesday approved a new equity incentive plan designed to bolster stock reserves for attracting and retaining talent, as well as a $42 million stock-based compensation package for newly appointed CEO Lip-Bu Tan. The vote took place during the company’s first shareholder meeting under Tan’s leadership.

Intel shares fell 1.6% in early trading, extending a 36% decline over the past year, as investors digest the company’s ongoing leadership and strategic shifts.

Tan, who succeeded Pat Gelsinger in March after the board lost confidence in his high-cost turnaround efforts, will have his compensation tied to Intel’s future stock performance. Tan has already initiated a restructuring plan, which includes flattening the corporate hierarchy, cutting excess middle management, and recalibrating Intel’s artificial intelligence roadmap.

Shareholders also approved the current board of directors, although three members did not seek re-election. Meanwhile, three shareholder proposals were rejected, including:

  • A call to reassess Intel’s operations in Israel,

  • A demand for new charitable giving transparency, and

  • A proposal to allow shareholders to act by written consent.

Tan said he plans to capitalize on Intel’s established positions in the PC and data center markets to deliver more competitive AI products, signaling a strategic refocus in an increasingly crowded chip landscape.

Musk Seeks Auction of OpenAI Stake Through State Attorneys General

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Elon Musk has asked the attorney generals of California and Delaware to facilitate an auction of OpenAI’s stake to establish the fair market value of its charitable assets during the company’s ongoing corporate restructuring. The request was made through a letter sent by Musk’s attorney, Marc Toberoff, on Tuesday, urging the states to implement a competitive bidding process to ensure the protection of public interests, as OpenAI works to distance its non-profit control.

Musk’s move comes amid OpenAI’s plans to convert into a public benefit corporation and separate its for-profit business from its charitable structure. OpenAI has stated that the valuation of its assets will be handled by independent financial advisors, despite Musk’s push for a more open bidding process.

Sam Altman, who co-founded OpenAI with Musk, helped propel the company into the limelight with the release of the ChatGPT AI tool in 2022. Backed by Microsoft, OpenAI was valued at $157 billion after raising $6.6 billion in investment. However, Musk, who owns the AI startup xAI, is challenging OpenAI’s conversion through legal means, arguing that it contradicts the original mission he had funded the company for. The court is expected to make a ruling later this month on Musk’s preliminary injunction.

In December, Delaware Attorney General Kathy Jennings filed an amicus brief, indicating her office’s scrutiny of OpenAI’s restructuring plans, while California’s Attorney General Rob Bonta has yet to make any public comments on the case. Musk’s legal efforts are supported by the AI safety group Encode, which has joined the push to block the transition, raising concerns about potential fiduciary violations.