Warner Bros. Discovery has announced it will split into two separate publicly traded companies by mid-2026, a move aimed at sharpening strategic focus and unlocking greater value for shareholders. The company, which has struggled under the weight of declining cable revenues and a sprawling portfolio of media assets, believes that separating its operations will better position each business to thrive in an increasingly competitive and fragmented entertainment landscape. The split will result in two distinct entities: one focused on streaming and studio production, and the other dedicated to traditional cable networks and global television assets.
The streaming and studios company will include Warner Bros. Motion Picture Group, Warner Bros. Television, HBO, HBO Max, DC Studios, and other content-related operations such as gaming, studio tours, and consumer products. This entity, which will be led by current CEO David Zaslav, will operate free from the burden of legacy TV infrastructure and will not inherit the company’s current debt load, enabling it to invest more aggressively in content and compete more directly with digital-first rivals like Netflix and Disney. The second company, Global Networks, will house cable and linear TV brands such as CNN, TNT Sports, Discovery Channel, Discovery+, and a range of international channels. It will be managed by Gunnar Wiedenfels and will retain most of Warner Bros. Discovery’s existing debt, with a focus on maximizing cash flow and stabilizing its legacy business.
The transaction is expected to be structured as a tax-free spinoff, subject to regulatory approvals and a green light from the IRS. A key part of the plan includes Global Networks retaining up to a 20% stake in the new streaming and studios company, which could be monetized over time to reduce debt. For shareholders, this move signals the potential for a significant shift in how the market values Warner Bros. Discovery’s assets. The stock rose about 11% following the announcement, reflecting optimism that separating the high-growth, capital-intensive streaming business from the slower-moving, cash-generating networks operation will allow investors to more clearly assess the strengths and risks of each.
Ultimately, the split offers investors a clearer choice between two distinct investment profiles: one focused on growth and content innovation, and the other on stability and cash generation. The goal is to allow both companies to operate with greater strategic clarity and independence, enhancing their ability to respond to rapid changes in consumer behavior and technology. If approved and completed as planned, the breakup will be one of the most consequential restructurings in the media industry in recent years.
