Warner Bros. Discovery (WBD), the multinational media and entertainment giant, recorded a net loss of $1.2 billion in the second quarter of 2023, with revenues also decreasing 4% (ex-FX) year-on-year.

Total revenue amounted to $10.3 billion, as opposed to $10.8 billion for the same period a year earlier.

The conglomerate’s networks segment, which includes the likes of pan-European sports broadcaster Eurosport, as well as the TNT Americas network which holds multiple sporting rights, brought in revenue of $5.7 billion. This represented (ex-FX) a decrease of 5% year-on-year from the equivalent period in 2022.

WBD released its second quarter and first half results, covering the three months and six months (respectively) up to June 30 this year, yesterday (August 3).

Networks distribution income came to $2.9 billion, a decrease of 1%, while advertising revenue was only $2.4 billion, a year-on-year decrease of 13%.

This advertising revenue loss was driven, WBD said, by “audience declines in domestic general entertainment and news networks and soft advertising markets.”

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By GlobalData

However, content revenue increased 18% ex-FX, “primarily driven by the timing of inter-segment content licensing to direct-to-consumer.”

Operating expenses in the networks division of WBD decreased 5%, to $2.8 billion, primarily due to “the broadcast of the NCAA March Madness Final Four and Championship [US college basketball] in the prior year.”

However, these savings were partially offset by what WBD described as “higher domestic sports-related expenses,” as well as by costs connected to the TNT Sports joint venture which WBD has entered into in the UK, amounting to a rebrand of the existing BT Sport broadcaster.

The TNT Sports financial results are currently unconsolidated, and not included in this earnings report.

The adjusted networks EBITDA (earnings before interest, taxation, depreciation, and amortization) came to $2.1 billion, an ex-FX decrease of 7% on the equivalent 2022 number.

WBD’s direct-to-consumer (DTC) segment, meanwhile, brought in total revenues of $2.7 billion, a year-on-year increase of 14%.

This section includes the discovery+ streaming platform which is used by WBD to air multiple top-tier sporting properties across Europe, the US, and other territories.

Total DTC subscription numbers came to 95.8 million, a decrease of 1.8 million since the end of the first quarter, with the figure well below what analysts were expecting the total to reach, according to media reports.

Domestically, 54 million subscribers were recorded, with international subscribers amounting to 41.8 million.

In terms of revenue, all DTC sectors (distribution, advertising, and content) saw income rise. In particular, year-on-year content income rose from $143 million to $410 million.

DTC operating expenses, meanwhile, came to $2.7 billion, a decrease of 8% year-on-year.

EBITDA for that segment recorded an improvement of $555 million on a pro forma combined basis.

Overall, WBD said that during the quarter it had repaid $1.6 billion in debt, although it still ended the three months with a debt of $47.8 billion.

David Zaslav, president and chief executive of Warner Bros. Discovery, said: “The important work we are doing to transform our businesses for the future continues to drive our strong financial performance as demonstrated by meaningful improvements to our balance sheet … All of which positions us well to lean into future growth opportunities that will ultimately drive shareholder value.”

For the first quarter results, reported in early May, WBD recorded a net loss of $1.1 billion.

The 2024 Olympic Games in Paris next year are the last under WBD’s current agreement for four editions of the games running from 2018 to 2024 as part of a €1.3-billion (then $1.45 billion) deal struck in 2015.

Read an interview on WBD's plans for the games with Scott Young, senior vice president of content and production at Warner Bros. Discovery Sports Europe, here.