The Warner Bros. Discovery (WBD) media and entertainment giant saw its revenues (reported) drop 4% year-on-year during the third quarter of 2024.
WBD, which released its Q3 financials earlier today, secured revenues of $9.6 billion in the three months up to September 30, down from $9.97 billion the prior year. This time period included the Paris 2024 Olympic Games, for which WBD was the main European broadcaster.
The networks segment of WBD, which contains the TNT and Eurosport networks, saw its revenue rise by 3%, however, from $4.8 billion to $5 billion.
This came primarily due to a substantial increase in content revenue year-on-year – from $215 million to $833 million – which more than offset decreases across both distribution and advertising income. This rise in content income was due to the sublicensing of rights to the 2024 Paris Olympics, which took place in July and August in the French capital and were covered in their entirety to WBD through a major pan-European deal dating back to 2014.
Indeed, sublicensing revenue for the Olympics came to $578 million out of the total.
Multiple sublicensing tie-ups between WBD – which showed the games on both linear channels and via its range of streaming platforms, such as Discovery+ and Max – were struck with free-to-air broadcasters across the continent.
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Max had expanded into Europe during the last few weeks before the Olympics.
In total, WBD aired the Olympics across nearly 50 markets in 20 languages on the Max and Discovery+ streaming services, and through Eurosport on linear television.
There was a cumulative reach of more than 215 million in Europe viewing Olympics content on WBD platforms – 23%, and over 40 million, more than the Tokyo 2020 games.
Adjusted EBITDA (earnings before interest, taxation, depreciation, and amortization) for the networks division came to $2.1 billion, meanwhile, down 12% from last year’s equivalent figure, meanwhile. WBD has said the broadcasting of the Paris Olympics across Europe “negatively affected” the adjusted EBITDA to the tune of $65 million.
Overall, WBD’s Q3 adjusted EBITDA came to $2.3 billion, a year-on-year fall of 19%.
In the direct-to-consumer (DTC) WBD segment, meanwhile, revenues jumped by 8%, up from $2.43 billion to $2.63 billion.
This was driven by a substantial 49% surge in advertising revenue, which hit $205 million during the three months, up year-on-year from $138 million. WBD put this down to an increase in domestic ad-lite subscribers.
This offset a slight drop in content revenue, from $120 million to $107 million.
Distribution income also rose, in this case by 6% to $2.32 billion.
For Max, there was an increase of 7.2 million global subscribers versus the Q2 figure, with the total on September 30 at 110.5 million. This was primarily due to a rise of 6.9 million subscribers in overseas markets – 57.9 million at the end of Q3, as opposed to 50.8 million as Q2 came to a close.
The rise represents the biggest quarterly increase in subscribers for Max since its launch (initially in the US) last May.
In terms of that platform’s expansion, late last month it was revealed that it will launch in Germany in 2026.
Adjusted EBITDA for the DTC division, meanwhile, came to $289 million – up from just $111 million the prior year.
David Zaslav, president and chief executive of Warner Bros. Discovery, has now said: “Thanks to our rapid international expansion and continued investment in high quality, diverse content, we saw momentum accelerate in our global DTC business in Q3. In total, Max delivered 7.2 million net subscriber adds, the strongest quarterly gain since the platform’s launch.”
These results compare favorably to WBD’s Q2 financials, in which the heavyweight had to substantially reduce the accounted value of its own media assets through a goodwill impairment charge.
In terms of Olympic viewership for WBD, there was a cumulative reach of more than 215 million in Europe viewing Olympics content on WBD platforms – 23%, and over 40 million, more than the Tokyo 2020 games.
In total, more than seven billion minutes were streamed throughout the games – six times more than Tokyo 2020.
Under a new agreement announced in January 2023, WBD will continue to cover the games on its streaming and digital platforms and hold full pay-TV rights for multiple editions.
This includes the 2026 Winter Olympics in Milan Cortina and the 2030 edition in the French Alps, as well as the 2028 Summer Olympics in Los Angeles and Brisbane in 2032.
