- Netflix acquires Warner Bros and HBO Max
- New regulatory risk emerages
- Big purchases will likely put pressure on company earnings
- Netflix acquires Warner Bros and HBO Max
- New regulatory risk emerages
- Big purchases will likely put pressure on company earnings
Netflix announced the finalization of the purchase agreement for the legendary Warner Bros, the company stated in a Friday announcement. The transaction will also include the HBO Max service and related assets. The new acquisition will ultimately cost Netflix 72 billion dollars.
Netflix's acquisition of one of its competitors noticeably increases Netflix's market share. The merger allows Netflix to take a noticeable lead and once again become the undisputed leader in streaming — at least in terms of market share.
However, investors initially react with skepticism. The stock price temporarily dropped by as much as 5% before returning to around the opening session level. Why?
The merger of two such large entities will attract the attention of regulators not only in the USA but also abroad. Control over such a large segment of the market raises serious concerns about real competition in the market. As a result, some investors are already starting to price in a premium for the newly emerged risk.
It is difficult to estimate with any degree of certainty the ultimate impact of Netflix's new acquisition on the market. If regulatory risk does not materialize, this could be the beginning of Netflix's journey to once again becoming the "default" streaming platform. At the same time, such a large purchase will exert significant pressure on the company's financial reporting.
NFLX.US (D1)
Source: xStation5
Another Day at Meta - Fines, AI, and CAPEX
US OPEN: Wallstreet enters "wait-and-see" period
Alibaba after Earnings: Will divergent strategy pay off?
📈 US100 gains 2.1%
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
