The debate between physical media aficionados versus streaming service subscribers continues to rage, even as physical media options dwindle. But entertainment giant Warner Bros. Discovery (WBD) is offering a bit of an olive branch to physical fans: a solution to address “disc rot.” Investors did not seem happy about this play, however, sending shares down over 4% in Monday afternoon’s trading.
For those not familiar, “disc rot” is a condition in which those shiny discs develop a loss of fidelity, essentially. Discs hit by disc rot can freeze, have glitches in their playback, or otherwise stop working altogether. For discs made between 2006 and 2008 from Warner, though, the problem seems to be particularly potent. Thus, Warner is offering free replacement copies of a disc hit by disc rot, as long as Warner still owns the rights to the material in question, and the material is in print.
Meanwhile, Warner is looking to save some money by shifting office space in Washington state. Reports note that Warner is pulling out of its Seattle offices and moving into new digs in Bellevue as soon as the Hill7 lease, covering 112,000 square feet, expires. It has already leased 48,000 square feet in the Civica Office Commons instead, a major drop in square footage.
Growing Concern About Gaming
Yet there may be a larger problem afoot for Warner: its games division. We all remember the debacle that was Suicide Squad: Kill the Justice League. But with Warner capping off February by shuttering three studios and the Wonder Woman game project that was in development, it became clear that Warner’s ability to handle video game development was lacking.
In fact, Warner’s subsequent releases have left a bad taste in gamers’ mouths altogether. The release of MultiVersus, for one, represented a significant problem. Gamers bought in, picked up new seasons, supported the game…only to find themselves left out in the cold when Warner shuttered the project. Now, Warner has largely tainted its own pool, and left at least some gamers unable to take Warner at its word on any project. With only one title set to release in all of 2025, Game of Thrones: Kingsroad, Warner’s ability to turn things around is limited.
Is WBD Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on WBD stock based on 10 Buys and eight Holds assigned in the past three months, as indicated by the graphic below. After a 17.31% rally in its share price over the past year, the average WBD price target of $13.09 per share implies 23.03% upside potential.
