“Majority” of Warner Bros. Discovery’s $37 Billion in Debt Will Be Spun Off With TV Networks, Its CEO Says

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Gunnar Wiedenfels, the new president and CEO of the spun off Global Networks, stated on Monday that it’s likely that a large portion, approximately $37 billion, of Warner Bros. Discovery’s debt will be carried by this new company. However, he also mentioned that a substantial part of this debt load will stay with Streaming & Studios, which David Zaslav will continue to oversee.

Regarding our target capital structure, we haven’t reached any final decisions yet. There are many aspects that need to be addressed before the deal is finalized. However, it’s likely that most of the debt will be handled by global networks, while Streaming & Studios will carry a substantial but not negligible portion as well.” (Wiedendfels, speaking to media analysts on a conference call)

By the close of March, Warner Bros. Discovery’s total debt amounted to a staggering $38 billion, a figure that encompasses both their “total debt” ($37.4 billion) and obligations from financial leases ($535 million). The merger between WarnerMedia (previously owned by AT&T) and Discovery, Inc., which took place in 2022, resulted in over $50 billion of accumulated debt.

On June 9th, earlier this week, Warner Bros. Discovery made an announcement that many in the industry had anticipated – a division into two separate entities. These new companies, both publicly traded, will operate independently: one focusing on Streaming & Studios, and the other on Global Networks. At a later date, they are expected to change their names (perhaps to “Warner Bros.” and “Discovery” once more).

Disney, like NBCUniversal’s recent strategy, is considering a move that resembles the formation of Versant. They have flirted with this concept in mind.

In their new venture, Global Networks, Wiedenfels – who currently serves as the CFO of WBD and has been a long-term trusted partner to Zaslav – anticipates continued robust cash production. Despite the decline of cable TV, it still yields significant cash flow, particularly for networks like CNN, which Wiedenfels will also be leading.

(The goal here is to maintain the original meaning while making the text more conversational and easier to understand.)

Wiedenfels and Zaslav are set to stay in their current positions at Warner Bros. Discovery until the company’s anticipated split in mid-2026, at which point they will continue their roles.

Zaslav’s new company, Streaming & Studios, will encompass Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO and HBO Max, along with their illustrious film and television archives. The second division, Global Networks, will house entertainment, sports, and news TV brands globally, including CNN, TNT Sports in the U.S., Discovery, free-to-air channels across Europe, digital products like the successful streaming service Discovery+, and Bleacher Report (B/R).

From my perspective as a gamer, it’s like this: Zaslav is the one who gets to handle the exciting, innovative aspects; Streaming & Studios is where all the prestige lies, along with most of the promising future projects. Wiedenfels will be responsible for maintaining our current revenue streams, but he’ll also shoulder all the potential downsides due to industry shifts, and let’s not forget, a large chunk of that debt too.

Three years ago, the way audiences interacted with content was experiencing a significant transformation,” Zaslav wrote in a memo to his team, as reported by The Hollywood Reporter. “Both organizations recognized that this evolution required adaptation, change, and leadership in the future entertainment industry. It became apparent that unity – leveraging each other’s strengths – was essential for success.

Not that it was always easy.

Although the work since the merger has had its tough moments, in the end, we’ve managed to bolster every aspect of our business,” Zaslav stated in the memo. “By combining Discovery and Turner networks, we’ve established ourselves as a dominant force in live and unscripted television, with a broad global reach and impressive profit margins. We’ve revolutionized our direct-to-consumer service, with HBO Max now ranked among the world’s few profitable and globally accessible streaming platforms. Moreover, by blending creative genius with operational efficiency, we’ve made significant strides in regaining our film and television studios’ position at the industry forefront.

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2025-06-09 16:24