Netflix is no longer contemplating a future that includes Warner Bros., having ceded the heated M&A battle to Paramount Skydance. Netflix CFO Spence Neumann, speaking Wednesday at the Morgan Stanley Technology, Media & Telecom Conference, reiterated the company’s position that it bailed out of the bidding for Warner Bros. because Paramount increased its offer price.
“The short answer is, it was all about price,” Neumann said. “We said all along this opportunity was a nice-to-have at the right price, not a must-have at any price,” he added, echoing Netflix co-CEO Ted Sarandos’ previous statement.
Netflix, when it struck the deal to buy WB’s studios and streaming business in December, was playing “offense, not defense,” Neumann said. According to the CFO, Netflix has a “unique view” into how to value the WBD assets. “We went into it with a point of view on price,” he said. “When it became clear it didn’t make sense for us financially anymore,” the company bowed out.
“Now we move forward, and we move forward with $2.8 billion in our pocket that we didn’t have a few weeks ago,” said Neumann, referring to the breakup fee it received from Paramount Skydance.
On Feb. 26, Netflix abandoned its deal to buy Warner Bros.’s studios and streaming business after David Ellison’s Paramount upped its hostile bid for WBD in its entirety to $31/share — leaving Paramount the winner of a debt-fueled takeover of the media conglomerate. Paramount Skydance paid Netflix the $2.8 billion breakup fee once Warner Bros. Discovery terminated its agreement with Netflix in favor of Paramount’s “superior” offer.
Asked if the Warner Bros. bidding war changed Netflix’s M&A strategy, Neumann replied, “I know it sounds boring, but it’s really no change.” The company will “continue to stay focused on what are those opportunities” to accelerate the growth of the business, he said.
Neumann said Netflix, by the end of the bidding process for Warner Bros., had “a stronger belief” that “we would have been great stewards” for those assets. And, he insisted, Netflix had high confidence that it had a “clear path” to regulatory approval.
Love Film & TV?
Get your daily dose of everything happening in music, film and TV in Australia and abroad.
“At the end of the day, we were going to be disciplined” on the price it was willing to pay for Warner Bros., Neumann said.
In 2026, Netflix plans to boost its total cash content spending to around $20 billion, up 10% from last year. It is forecasting revenue of $50.7 billion-$51.7 billion, which would be an increase of 12%-14% year over year, and projects hitting 31.5% operating margin in 2026. The streaming heavyweight reported more than 325 million subscribers worldwide as of the end of 2025, up from 301.2 million a year prior.
The expected 10% increase in Netflix’s content spending this year is in line with its expected revenue growth, Neumann said. “It’s really no change in our approach,” he said. “We really want to be that starting point and destination for professionally produced content for creators around the world.”
From Variety US