Warner Bros. Discovery’s (NASDAQ:WBD) losses narrowed in Q1 with a loss of $0.40 per share, compared to a loss of $0.44 per share in the same period last year. Analysts expected the media conglomerate to report a loss of $0.23 per share.
The company generated total revenues of $9.95 billion in the first quarter, a decline of 7% year-over-year on a currency-neutral basis, and fell short of consensus estimates of $10.25 billion.
WBD’s Direct-to-Consumer Business in Q1
Warner Bros. Discovery added 2 million streaming subscribers in the first quarter, totaling 99.6 million. This business generated revenues of $2.46 billion in Q1, a modest increase year-over-year. However, advertising revenues for the direct-to-consumer business segment soared 70% year-over-year to $175 million. This rise was primarily due to higher engagement on Max in the U.S., driven partly by the launch of B/R Sports on Max in October 2023, and growth in “ad-lite” subscribers. “Ad-lite” subscribers are users who subscribe to a streaming service with reduced advertising.
Recently, the company announced that it had teamed up with Disney (NYSE:DIS) to launch a streaming service.
Is WBD a Good Stock to Buy?
Analysts remain cautiously optimistic about WBD stock, with a Moderate Buy consensus rating based on nine Buys, seven Holds, and one Sell. Over the past year, WBD has declined by more than 40%, and the average WBD price target of $13.61 implies an upside potential of 70.1% from current levels. These analyst ratings are likely to change following WBD’s Q1 results today.
