LOS ANGELES (Diya TV) — Warner Bros. Discovery (WBD) announced plans to split into two separate publicly traded companies by mid-2026, separating its iconic Hollywood studios and streaming service from its legacy cable TV networks. The move aims to give each business more strategic flexibility amid massive disruption in the media landscape.
The split will create two entities: one focused on streaming and studios — including HBO, HBO Max, Warner Bros., and DC Studios — and another encompassing traditional cable networks such as CNN, TNT Sports, and Discovery. The streaming-and-studios company will be led by current CEO David Zaslav, while CFO Gunnar Wiedenfels will take the helm of the networks-focused entity, dubbed “Global Networks.”
“This isn’t a departure from our strategy,” Zaslav wrote in an internal memo to staff, obtained by CNN. “It’s about unlocking the full potential of two strong businesses, each with a distinct focus, a clear mission, and the scale to succeed on its terms.”
The announcement marks a significant reversal of the 2022 mega-merger between WarnerMedia and Discovery, which initially aimed to create a vertically integrated content powerhouse. Since then, WBD’s stock has plunged nearly 60%, weighed down by declining cable revenue, fierce competition in the streaming market, and concerns about its $38 billion debt load.
Much of that debt, currently rated “junk” by S&P Global Ratings, will reside with the Global Networks company after the split. As reported by Reuters, WBD has secured a $17.5 billion bridge loan from J.P. Morgan to help restructure its obligations. The deal will be structured as a tax-free transaction, according to CNN.
While the streaming unit will control the company’s most prized assets — HBO Max, Warner Bros. films, and DC franchises — the networks division will retain some streaming capabilities, including Discovery+ and Bleacher Report. CNN is also developing a new streaming product set to launch later this year.
The split comes amid broader turmoil in the cable TV sector, as more viewers cut the cord and shift to digital platforms. “The outlook for the cable network business broadly is pretty ugly,” analyst Jeff Wlodarczak of Pivotal Research Group told Reuters, noting the potential for further consolidation.
Media peers are making similar moves. Comcast is spinning off NBCUniversal’s cable channels into a new company, Versant, while Lionsgate recently separated its Starz cable network from its studio operations.
Some analysts see the WBD breakup as more financial engineering than operational strategy. “If anything, it could make them worse off,” said Brian Wieser, CEO of advisory firm Madison and Wall, speaking to CNN. “It may hamstring both sides until the transactions are complete.”
Despite the challenges, WBD remains optimistic about the future of its streaming unit. The company expects HBO Max subscriptions to grow from 122 million currently to over 150 million by the end of 2026. That figure still trails competitors like Netflix, which boasts over 300 million subscribers, and the combined Disney+ and Hulu base of 181 million.
The decision also follows increasing shareholder unrest. Last week, roughly 59% of WBD shareholders voted against executive compensation packages, including Zaslav’s $51.9 million pay for 2024, in a nonbinding advisory vote, according to Reuters.
The transaction is still subject to regulatory approval, which could prove challenging given current antitrust scrutiny. Still, Zaslav told investors the choice was clear. “The right path forward became increasingly evident — to separate global networks and streaming, and studios into two independent, publicly traded companies.”
As Warner Bros. Discovery prepares for this significant transformation, the move underscores a larger industry trend: the unraveling of the once-coveted media conglomerate model in favor of leaner, more focused operations.
