Paramount Skydance CEO David Ellison has won the bidding war for Warner Bros. Discovery.
Netflix said Thursday it won’t raise its bid, paving the way for Paramount to buy WBD and become a Hollywood behemoth.
The decision comes two days after Paramount increased its offer to $31 per share for all of WBD, including its cable networks like CNN and HGTV. WBD’s board said Thursday that Paramount’s latest offer was better than Netflix’s proposal to buy its streaming and studio assets — including Warner Bros. and HBO Max — for $27.75 per share.
“The transaction we negotiated would have created shareholder value with a clear path to regulatory approval,” Netflix co-CEOs Ted Sarandos and Greg Peters said in a statement. “However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.”
Netflix will now pocket a $2.8 billion breakup fee paid by WBD, which Paramount has said it will reimburse.
Netflix investors seem thrilled. The stock surged by more than 10% in after-hours trading following the announcement. Paramount shares jumped about 5%.
WBD shares slipped 1.8%, a potential sign that shareholders were counting on an even bigger bidding war.
A combination of Paramount and WBD could create a true rival to Hollywood leaders Netflix and Disney. However, despite its size, it would still face the daunting task of transitioning legacy media assets — including declining cable TV networks — to a new era dominated by streaming and social media.
“We are excited about the potential of a combined Paramount Skydance and Warner Bros. Discovery and can’t wait to get started working together telling the stories that move the world,” WBD CEO David Zaslav said in a statement.
A Hollywood-shaking deal
Ellison has relentlessly pursued WBD for months, making 10 official offers for the company. His pursuit of WBD has been backed by his father, Larry Ellison, the billionaire cofounder of cloud giant Oracle.
Paramount already owns its iconic movie studio, Paramount+, CBS, and TV networks like MTV and Comedy Central.
If Paramount’s WBD deal secures regulatory approvals, it will get the Warner Bros. studio, HBO, HBO Max, and cable networks like CNN, TNT, and HGTV, plus the Discovery+ streaming service.
Though the combination would make Ellison a Hollywood heavyweight, his company would still fall behind Netflix in a few key metrics.
HBO Max had 131.6 million subscribers as of the fourth quarter, while Paramount+ had 78.9 million paid subscribers as of late 2025.
Netflix crossed 325 million subscribers in the fourth quarter of 2025.
WBD’s streaming services accounted for 1.4% TV share on US TVs in January, according to Nielsen, compared to 2.3% for Paramount’s streamers. For comparison, Netflix was at 8.8% while Disney’s streamers got 4.9%.
One side plot is that CNN may soon find itself with the same corporate parent as CBS News, which Ellison has begun to remake by installing the polarizing Bari Weiss as its editor in chief.
Political rhetoric heated up in recent days
Paramount has framed itself as a better buyer for WBD than Netflix, which it said would wield unhealthy sway over competitors and consumers if it bought HBO and gained access to iconic IP like DC Comics’ Batman.
Netflix argued that it would be a better caretaker of Warner Bros. by laying off fewer staffers than Paramount would, while creating TV jobs in a Hollywood plagued by fewer productions. Paramount has promised investors $6 billion in cost savings from the deal.
Both Netflix and Paramount have angled for support from regulators and President Donald Trump. Paramount is willing to pay WBD a $7 billion breakup fee if its deal is blocked, a sign of Ellison’s confidence in regulatory approval.
A White House spokesperson told Business Insider in mid-February that Trump had “great relationships with all parties in this potential transaction and remains neutral in this process with no preference” for Netflix or Paramount.
However, Netflix caught Trump’s ire days later, with the president saying that the streaming giant must remove board member Susan Rice “or pay the consequences.” Rice, a White House official during the Obama and Biden administrations, appeared on a podcast and criticized Trump and companies she believes chose to “take a knee” to the president.
Sarandos previously downplayed Trump’s comments, saying the Netflix-Warner Bros. tie-up is “not a political deal.”
Disclosure: Mathias Döpfner, the CEO of Business Insider’s parent company, is a Netflix board member.
