Performance shrinking still "in demand": Warner Bros. (WBD.US) Q4 revenue and profit both decreased. Paramount and Netflix continue to compete in a bidding war.

Notice that Warner Bros. Discovery (WBD.US) saw a decline in sales and profits in the fourth quarter. This further highlights the serious challenges that this media giant faces when considering acquisition offers from competitors. The financial report shows that Warner Bros. Q4 revenue decreased by 5.6% year-on-year to $9.46 billion. Adjusted EBITDA decreased to $2.22 billion. However, both of these figures were better than Wall Street's expectations. The loss per share was $0.10, compared to a loss of $0.20 per share in the same period last year. Due to a decrease in advertising sales and distribution revenue, Warner Bros.'s TV network business, including CNN, TNT, and HGTV, saw a 12% decrease in revenue to $4.2 billion. Adjusted EBITDA decreased by 27% to $1.41 billion. Warner Bros.'s studio division reported a 13% decrease in revenue to $3.18 billion, lower than Wall Street's expected $3.37 billion. Revenue from movies, TV shows, and video games all declined, with profits decreasing by 23%. Streaming business revenue increased by 5% to $2.79 billion, partly due to growth in advertising business, while profits slightly decreased. Services like HBOMax added 3.5 million new subscribers this quarter, bringing the total global subscriber count to 131.6 million. At the time of this performance release, a fierce bidding war for this iconic Hollywood studio is heating up. Paramount Sky (PSKY.US) raised its offer for Warner Bros. to $31 per share in the past week, aiming to disrupt the current deal the company has with Netflix (NFLX.US). Warner Bros. is currently weighing whether this new offer is superior to the existing transaction (selling its studio and HBOMax business to Netflix for $27.75 per share). If the board supports Paramount's new offer, Netflix will have four days to respond with a counteroffer or walk away. This season, Warner Bros. lost the U.S. media rights to the NBA due to a new agreement signed between the league and Walt Disney Company, Comcast Corporation Class A, and Amazon.com, Inc. This change has impacted their TV ratings. As per the terms of the agreement reached with Netflix, Warner Bros. plans to spin off its cable TV networks into a separate entity in the third quarter. Warner Bros. Discovery was the result of a merger four years ago. The company has been striving to compete with streaming rivals like Netflix and reverse the decline in traditional cable TV audience. With over $32 billion in debt, its stock price has been long depressed, but it has risen by 130% since Paramount expressed interest in acquisition in September last year.