🎬 The 'Undo' Button

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CLOSEUP
⛓️‍💥 Warner Bros. is hitting “Ctrl + Z”…

Just three years after AT&T's WarnerMedia merged with Discovery in a $43B bet to create a Netflix-killing streaming giant, the company announced Monday it's splitting back into two separate entities by mid-2026. That honeymoon phase didn’t last long. Here’s how it will be divided:

• Streaming & Studios: The prestige stuff—HBO Max, Warner Bros. Motion Pictures, Warner Bros. Television, DC Studios, and HBO—helmed by current CEO David Zaslav.

• Global Networks: Everything else—cable channels (TNT, TBS, HGTV, Food Network), CNN, sports networks, Discovery+, and Bleacher Report—led by current CFO Gunnar Wiedenfels.

The brutal math behind the move:

• 📉 The Debt Problem: WBD is drowning in $37B of debt (for a company worth only $26B). They're taking out another $17.5B loan just to make this split happen.

• 💰 The Linear Decline: Their cable networks saw profits drop 15% and revenue fall 7% in Q1 alone. Add losing NBA rights to that mix, and you've got a serious headache.

• 📺 The Streaming Reality Check: Despite all the hype, Max still only grabbed 1.5% of total streaming viewership in April—second-to-last among major streamers, according to Nielsen's Gauge report.

The market's reaction: Wall Street wasn't exactly thrilled. S&P Global immediately downgraded WBD deeper into junk status (BB rating) and put the company on negative credit watch, basically saying "we think this is going to get worse before it gets better."

So what’s really going on here? This isn't just Warner Bros. Discovery having commitment issues—it's part of a larger industry trend. Comcast just spun off its cable networks into "Versant," and Lionsgate recently separated from Starz. Legacy media companies are basically performing surgical operations to remove their "dead weight."

Looking ahead: This split isn't really about creating two thriving companies. It's about making each piece small enough to be acquired. Industry veterans are already placing bets on who'll buy what—Netflix, Amazon, and Disney are all potential suitors for the studios side, while the cable networks will likely get scooped up by private equity firms specializing in managing decline.

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WIDESHOT
🎬 Spain, Hulu, and ad spending…

🇪🇸 Netflix just dropped €1B on Spain. The streaming giant announced a four-year investment commitment that will fund Spanish films and TV shows through 2028. Spain has just 8.7M Netflix subscribers compared to France's 14.6M… so why bet on a smaller market? Simply put, Spanish content has performed incredibly well: it’s generating twice the global viewing hours of French or German titles. Spain has racked up 8 entries in Netflix's top 10 most-viewed non-English shows ever—more than any other country—led by breakouts like ‘Money Heist’ and ‘Society of the Snow.’ The investment is part of Netflix's broader global spending spree that includes $2.5B in South Korea, $1B in Mexico, and nearly $6B in the UK over recent years. The strategy is simple: Netflix is banking on hyper-local authenticity that paradoxically resonates better globally than watered-down universal content.

🤝 File this under "expensive ways to avoid sharing": Disney's Hulu buyout. The Mouse House just paid Comcast an extra $439M to finalize complete ownership of the streaming service, wrapping up a corporate custody battle that’s been dragging on for years. The messy breakup began when Disney gained operational control in 2019 but left Comcast—a leftover from Hulu’s original multi-company setup—holding a third of the equity. The two media giants couldn't agree on what Hulu was worth: Disney lowballed, Comcast went high, and arbitrators had to play referee. CEO Bob Iger expressed relief the deal is "finally resolved," clearing the runway for Disney to merge Hulu deeper into the Disney+ ecosystem.

📹 Is this the moment creators officially overtake Hollywood? Global ad spending forecasts just got slashed for 2025 due to tariff uncertainty and economic jitters. Meanwhile, creator-driven platforms like YouTube, TikTok, and Instagram are bucking the trend—they'll capture more than half of all content-driven ad dollars for the first time ever, surpassing traditional Hollywood content. Creator revenue is expected to hit $184.9B this year—up 20% from 2024. These creator platforms have a key advantage: creators make content for free while traditional media companies burn cash on studios, executives, and production. Instead, creator platforms can dump that money into AI and targeting tech that makes ad spending way more efficient—showing dog food ads to actual dog owners instead of random TV commercials. Advertisers love this precision and pay for it. This might be the milestone where the underdogs became the top dogs in entertainment.

LAST LOOKS
Film Development 🗒️

• Peter Sohn will direct ‘Incredibles 3,’ taking over from Brad Bird, who remains on board as writer and producer. (more)

• Sony Pictures Animation has set Stephen Curry, Caleb McLaughlin, Gabrielle Union, and Nick Kroll for the voice cast of ‘Goat.’ (more)

• Patrick Schwarzenegger will star opposite Margaret Qualley in ‘Love Of Your Life,’ a new Amazon MGM film directed by Rachel Morrison. (more)

• Nintendo has delayed its live-action ‘Legend of Zelda’ movie to May 7, 2027, citing production reasons. (more)

• Yahya Abdul-Mateen II has joined David Fincher’s ‘Once Upon a Time in Hollywood’ sequel. (more)

• Mark Ruffalo will star in ‘Being Heumann,’ Apple’s adaptation of Judy Heumann’s memoir, directed by ‘CODA’s’ Siân Heder. (more)

• Jonathan Daviss will star as Snoop Dogg in Universal’s upcoming biopic, directed by Craig Brewer. (more)

• Scott Cooper will write, direct, and produce a new untitled crime drama for United Artists and Scott Stuber at Amazon MGM Studios. (more)

• ‘Oldboy’ screenwriter Hwang Jo-yoon makes his streaming debut with Disney+ Korean crime thriller ‘Gold Land.’ (more)

• Emily Mortimer will direct ‘Dennis,’ a Moscow-set romance starring Alison Oliver and Yura Borisov, produced by A24 and Fruit Tree. (more)

TV Development 📺

• Rachel Brosnahan will star in and executive produce S2 of Apple’s legal drama ‘Presumed Innocent.’ (more)

• Gemma Chan and Chloë Sevigny have joined Peacock’s ‘The Five-Star Weekend’ as a series regular alongside Jennifer Garner, Regina Hall. (more)

• Felicity Huffman is joining S2 of Fox’s medical drama ‘Doc’ as a series regular, playing a sharp and ambitious doctor with a secret. (more)

• Titus Welliver will star alongside J.K. Simmons in ‘The Westies,’ an MGM+ crime drama about a brutal Irish gang in 1980s Hell’s Kitchen. (more)

• Iris Apatow has joined S3 of Hulu’s ‘Tell Me Lies’ in a recurring role as a college freshman hiding a secret. (more)

• HBO’s ‘Harry Potter’ series has added nine characters, including Molly Weasley, and Lucius Malfoy, and Draco Malfoy. (more)

• Prime Video has renewed ‘Maxton Hall – The World Between Us’ for S3 ahead of its S2 premiere this November. (more)

Business 🤝

• Paramount CFO Naveen Chopra is stepping down and will be temporarily replaced by former Discovery CFO Andrew Warren. (more)

• Paramount is cutting another 3.5% of its U.S. workforce, citing declines in linear TV and broader economic challenges. (more)

• Disney+ has named Angela Jain head of content for EMEA to lead its push for more local originals and expand its international streaming slate. (more)

• Major League Baseball has acquired a stake in Jomboy Media to co-create content and expand its reach in the creator economy. (more)

Other News 🚨

• SAG-AFTRA has reached a tentative deal with video game companies to end the nearly 10-month strike, pending board approval and final terms. (more)

• A judge has thrown out Justin Baldoni’s $400M defamation suit against Blake Lively, ruling her harassment claims were legally protected. (more)

• The 2025 BET Awards took place Monday night—see the full list of winners here.

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