Warner Bros. Discovery's second quarter revenue missed at $8.7B, but streaming profitability drove an unexpected EPS beat.

Warner Bros. Discovery reported second quarter revenue of $8.72 billion, an 11% decline year-over-year, missing analyst expectations. However, the company posted a surprise profit with diluted EPS of $0.06, beating estimates for a loss. The results were driven by strong growth in the Streaming segment, which was offset by significant declines in the Studios and Linear Networks segments.

Key Highlights

• Revenue fell 11% to $8.72 billion, impacted by a 39% ex-FX drop in Studios revenue and a 22% ex-FX decline in total advertising revenue.
• The Streaming segment was a bright spot, with revenue growing 10% to $3.1 billion and Adjusted EBITDA increasing 75% to $512 million.
• The company generated $572 million in free cash flow, down 19% from the prior year, and ended the quarter with net debt of $29.7 billion.