Netflix shares sink as concerns mount over risks of Warner Bros deal

Netflix investors were already sceptical about its US$72 billion (S$93.4 billion) deal for Warner Bros Discovery.

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Now the threat of having to pay even more and potentially face a protracted regulatory fight is making matters worse.

Shares of Netflix fell 3.4 per cent on Dec 8, at the lowest since mid-April, after Paramount Skydance made a US$108 billion hostile bid for the HBO owner and US President Donald Trump said the Netflix deal “could be a problem”.

The stock is down more than 20 per cent since Oct 21, when a disappointing third-quarter earnings report added to unease about its potential pursuit of Warner Bros.

“A higher bid by Paramount makes it more likely that either Netflix has to increase its price or walk away,” said Mr Uday Cheruvu, portfolio manager at Harding Loevner.

Even if Netflix prevails, the acquisition is risky because it involves integrating a whole new organisation and “the problems that brings”, Mr Cheruvu said.

After rallying early in 2025, Netflix shares have been under pressure in recent months amid concerns about its growth outlook and its costly pursuit of Warner Bros.