Warner Bros. Discovery Sees Profit Increase Amid Challenges

Warner Bros. Discovery set to report Q4 results, with EPS expected at $0.11, a turnaround from previous losses. Despite a tough landscape, analysts remain cautiously optimistic about WBD's future.

Date: 28-01-2025

AI Rating: 6

Earnings Per Share (EPS)
WBD is projected to report a profit of $0.11 per share for Q4 2024, marking a significant increase of 168.8% from a loss of $0.16 per share in the same quarter last year. This is a positive signal for investors, as it demonstrates a turnaround in earnings. However, analysts forecast a full-year loss of $4.33 for fiscal 2024, which is a notable decline from a loss of $1.28 in fiscal 2023. For fiscal 2025, there is an expectation of a growth in EPS to $0.18, reflecting an optimistic outlook beyond the immediate term.

Stock Performance
WBD shares have underperformed against the S&P 500 and XLC over the past year, with a reported decline of 1.5%. This indicates that there are challenges affecting demand for their stock, as it lagged behind broader market trends. The company's recent report of weaker-than-expected Q3 revenue of $9.6 billion exacerbates concerns, although shares closed up due to an earnings beat.

Trends and Challenges
The ongoing transition from cable to streaming platforms has led to increased content acquisition and production costs, which may further impact profit margins. Additionally, WBD's direct-to-consumer segment has seen significant subscriber growth with 7.2 million new additions, showcasing potential in new business models but also presenting challenges Traditional advertising markets are diminishing, which may affect revenue streams.

Analyst Sentiment
Despite the hurdles, the consensus rating on WBD stock remains moderately bullish, with a “Moderate Buy” rating among analysts. This reflects a cautious optimism that may positively influence investor sentiment.

Stocks: WBD