This afternoon, we issued our earnings release, shareholder letter, and trending schedule, and these materials can be found on our website at ir.wbd.com. More importantly, we are seeing healthy acceleration in subscriber-related revenue growth, which we expect will pick up real pace in Q2 and through the rest of the year. We believe the key to strong subscriber and subscriber-related revenue growth is delivering content that audiences love, boy, do they love what they're getting on HBO Max today. The work we've done to return our WB Studios to leadership has set the foundation for the company's next chapter.
We're seeing the benefits of the operating leverage that we have start to really kick in as the growth on profits is really starting to accelerate as we look throughout the year. I think, going forward, the great thing is, we still have multiple different levers of growth, Rich, to your point. You know, HBO Max is a global high-growth asset, is really the linchpin of our ability to have our ambition to split the company. and Casey and the whole team and the creative renaissance that went behind it, that is the leading growth asset at Warner Bros.
Increasingly, we're seeing very significant revenue contributions growing from international and in some cases more than 50% of revenue is coming out of streaming utilization of this content. The demand for this content and the viewer engagement is still there and continues to be a great business for us. As we think about studios, the guidance I think for adjusted EBITDA is relatively in line with 2025. Is there any good way for us to just think about the revenue or the EBITDA of the studio business excluding that?
| Metric | Period | Current guidance |
|---|---|---|
| Total streaming subscribers | FY2026 (year-end) | More than 150 million globally by year-end |
| WB Studios adjusted EBITDA | Annual goal | At least $3 billion |
| Studio adjusted EBITDA | FY2026 | Maintaining roughly in line with 2025 (an ambition for the team) |
| Free cash flow transaction/separation impact | FY2026 | May not reach 2025 level but pretty close; ~$100 million negative through Q1 |
| Metric | YoY | Note |
|---|---|---|
| Overall networks | Up significantly | Focus on creating more content across sports, food, home and general entertainment; sports doing very well and CNN ratings up significantly. |
| Streaming profitability | From -$2 billion historically to +$1.4 billion last year | Global scaling of HBO Max, operating leverage from tech platform investments, and a stronger, more consistent content slate. |
| Networks EBITDA | Down roughly in line with revenue | Secular linear decline, partially offset by international share gains, streaming utilization of content, and continued efficiency management. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| HBO Max as growth linchpin | Losing over $2 billion as a subscale, primarily U.S. service | Effectively a $4 billion turnaround and the leading global high-growth asset underpinning the company split and Paramount deal | — |
| Bundling and consolidation | No bundled subscribers from other programmers three years ago | Bundles with Disney, RTL+ in Germany, Viu in Southeast Asia and LATAM; bundled subs are the highest-LTV cohort with strong churn benefits | — |
| Sports in streaming | Playing in sports internationally for 15+ years | Disciplined experimentation across markets (simulcast in U.S., standalone in U.K., bundled in Brazil/Mexico) to find a profitable model | — |
| Scale strategy | Aggregating all content in one place | Global scale is key, but distributing content across HBO Max, AVOD, and channels in different markets captures more value than putting everything in one basket | — |