Netflix has withdrawn from its bid to acquire Warner Bros. Discovery’s (WBD) studio and streaming assets, ending a months-long bidding process and clearing the path for Paramount Skydance to proceed with its acquisition of the entire company.
On February 26, 2026, WBD’s board determined that Paramount Skydance’s latest offer was superior to the existing $82.7 billion agreement signed with Netflix on December 5, 2025.
The Netflix deal targeted WBD’s streaming service (including HBO Max) and studio operations, leaving other parts of the company separate. Under the terms of the Netflix agreement, Netflix had four business days to match the superior proposal. However, within hours of the announcement, Netflix co-CEOs Ted Sarandos and Greg Peters stated the company would not raise its offer.
In a joint statement, they said: “The transaction we negotiated would have created shareholder value with a clear path to regulatory approval. 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.”
They added: “Warner Bros. is a world-class organization, and we want to thank David Zaslav, Gunnar Wiedenfels, Bruce Campbell, Brad Singer and the WBD Board for running a fair and rigorous process. We believe we would have been strong stewards of Warner Bros.’ iconic brands, and that our deal would have strengthened the entertainment industry and preserved and created more production jobs in the U.S. But this transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”
Netflix emphasised its ongoing organic growth, noting plans to invest about $20 billion in content this year and resume share repurchases.
Investors responded positively to the decision. Netflix shares rose 10 percent following the announcement, reflecting relief that the company avoided a higher-priced deal.
Paramount Skydance completed its merger in August 2025, after which David Ellison, CEO of Paramount, targeted WBD with initial offers, which were rejected. This led WBD to launch a formal auction, attracting bids from Paramount Skydance, Netflix, Comcast, and an unnamed party.
Netflix secured its agreement in December for the targeted assets. Paramount then pursued a hostile tender offer for the full company, threatening a proxy fight and raising its bid multiple times.
Paramount’s latest proposal, announced recently, raised its price to $31 per share in cash (from $30), with added assurances on financing, a $7 billion regulatory termination fee, payment of the $2.8 billion breakup fee owed to Netflix, and other adjustments addressing WBD concerns.
WBD and Paramount Skydance are now finalizing the agreement text. The deal requires approval from WBD shareholders and regulatory clearance in the US and other jurisdictions. The outcome shifts control of WBD’s assets, including Warner Bros. studios, HBO, and linear networks, to Paramount Skydance, backed by the Ellison family and other investors.
Netflix’s exit maintains its focus on independent growth in streaming, avoiding integration risks and higher costs. The bidding war highlighted pressures in the media sector, where companies seek scale amid competition from streaming platforms and declining traditional TV.
