Netflix said it will not raise its offer for Warner Bros. Discovery, stepping back from an escalating takeover battle after Paramount Global increased its bid to US$31 per share.
In a statement released Thursday, Netflix co chief executives Ted Sarandos and Greg Peters said the company would not match the revised Paramount Skydance offer, arguing that doing so would undermine financial discipline. The executives said the original transaction negotiated by Netflix would have created shareholder value and offered a clear regulatory pathway, but that at the higher price required to compete with Paramount’s latest bid, the deal was no longer financially attractive.
The decision comes just days after Paramount raised its hostile offer from $30 to $31 per share for all of Warner Bros. Discovery, including major cable assets such as CNN and HGTV, as well as premium properties tied to HBO and DC Comics. Paramount has reportedly submitted multiple formal offers over several months, intensifying what has become one of the most closely watched media acquisition battles in recent years.
Following Netflix’s announcement, its shares surged more than 9 percent in after hours trading, signaling investor approval of the company’s decision to prioritize balance sheet discipline over aggressive bidding. Markets appeared to interpret the withdrawal as a sign that Netflix is unwilling to overextend financially in pursuit of scale.
The tug of war between Netflix and Paramount has unfolded against a backdrop of heightened regulatory scrutiny and political attention. Paramount has framed itself as a more suitable acquirer, arguing that a Netflix takeover of Warner Bros. Discovery could concentrate excessive power in streaming and grant Netflix expanded control over valuable intellectual property, including iconic franchises such as Batman.
Netflix, for its part, has countered that it operates in a highly competitive landscape that includes free streaming platforms, traditional television and user generated content ecosystems. The company has also suggested it would be a more stable steward of Warner’s assets, potentially preserving more jobs and production capacity in an industry grappling with cost cuts and reduced output.
The regulatory debate has drawn attention from Washington. President Donald Trump has commented publicly on the potential implications of a Netflix Warner combination, at one point suggesting that Netflix’s market position could present concerns. More recently, he indicated he would defer to the US Department of Justice to evaluate any antitrust considerations.
Political tensions briefly flared when Trump criticized Netflix over comments made by board member Susan Rice, a former White House official, though Sarandos maintained that the proposed acquisition was not political in nature. Reports indicated Sarandos attended meetings at the White House during the week, though details of those discussions were not disclosed.
For Warner Bros. Discovery, the outcome of the bidding contest carries significant strategic implications. The company controls a vast portfolio spanning film studios, premium television, cable networks and globally recognized franchises. Any acquisition would reshape the competitive dynamics of the media and streaming sectors, where consolidation has accelerated amid rising content costs and subscriber growth pressures.
Paramount’s persistence suggests it sees strong strategic alignment in combining its own assets with Warner’s portfolio. A successful deal would create a larger diversified media entity spanning broadcast, cable and streaming properties, potentially better positioned to compete with dominant global platforms.
Netflix’s withdrawal at the higher bid level underscores a broader theme in today’s media landscape. Scale remains important, but financial sustainability and regulatory certainty are equally critical. By declining to escalate its offer, Netflix is signaling that disciplined capital allocation outweighs the pursuit of additional content libraries at any cost.
As Warner Bros. Discovery evaluates Paramount’s revised proposal, attention will shift to regulatory reactions and shareholder sentiment. The outcome will likely influence not only the future structure of the companies involved but also the trajectory of consolidation across the global entertainment industry.
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