Netflix (NFLX) Stock; Drops Marginally While Considering Higher Warner Bros. Bid

TLDRs;

• Netflix stock dips slightly as the company weighs raising its $82.7B Warner Bros. bid amid Paramount competition.
• Paramount’s $108.4B offer challenges Netflix, raising questions about financing and stability of a potential combined company.
• The deal faces US and UK antitrust reviews that could impose conditions or limit Netflix’s streaming growth.
• Warner Bros. shareholders will vote on Netflix’s offer March 20, with Paramount’s deadline to bid set February 23.

Netflix (NASDAQ: NFLX) stock saw a modest decline on Thursday as investors digested the latest developments in the high-stakes bidding war for Warner Bros. Discovery (WBD). Sources familiar with the matter indicate that Netflix is prepared to increase its $82.7 billion offer, or $27.75 per share, if Paramount Skydance submits a more aggressive bid.

Netflix, Inc., NFLX

Paramount has already proposed a $108.4 billion deal, or $30 per share, to acquire the entire studio and streaming portfolio. Netflix, which reportedly holds about $9 billion in cash, has the flexibility to respond with a higher offer, signaling its willingness to compete for the coveted entertainment assets, including franchises like Harry Potter and Game of Thrones.

Paramount’s Offer Brings Higher Risk

While Paramount’s bid is significantly larger on paper, Warner Bros.’ board has raised concerns about the financial and operational stability of a combined Paramount-WBD entity. Analysts point to a projected debt-to-EBITDA ratio of 6.8x by 2026 and describe Paramount Skydance’s credit rating as barely above junk status.

In contrast, Netflix’s proposal benefits from backing by a company with a market capitalization above $400 billion and an investment-grade balance sheet. Additionally, the Netflix deal plans to restructure certain assets into Discovery Global, which includes linear television networks, making a direct comparison with Paramount’s bid less straightforward.

Antitrust Concerns Loom

The potential acquisition has already drawn scrutiny from regulators in the United States and the United Kingdom. The Department of Justice is reportedly monitoring the situation, while UK lawmakers have called for an investigation by the Competition and Markets Authority (CMA).

A Netflix acquisition of Warner Bros. would create a streaming powerhouse with an estimated 33% share of the U.S. market, raising concerns that the merger could reduce competition and increase subscription costs. Director James Cameron has also voiced opposition, warning that such consolidation could negatively impact cinemas and reduce consumer choice. Even a successful bid may come with regulatory conditions that could reshape content production and distribution for years.

Shareholder Vote Approaches

Warner Bros. Discovery has scheduled a shareholder vote on Netflix’s offer for March 20. Paramount has been given until February 23 to submit a revised bid, keeping the competitive pressure on Netflix. Paramount also intends to nominate directors at the upcoming annual meeting, signaling its continued push to gain influence over the company’s strategic direction.

Investors appear cautiously optimistic but are weighing the regulatory and financial risks of either deal. The market response reflects uncertainty about how the bidding war will conclude, with Netflix’s stock showing a modest pullback amid speculation about a potential increase in its offer and ongoing antitrust reviews.

Netflix’s next moves in the Warner Bros. acquisition battle could define the future of streaming competition, content ownership, and shareholder value for years to come.

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