WBD
Warner Bros. Discovery, Inc. Series A Common Stock
stock NASDAQ

WBD really did have the best CFO in Wiedenfels. That debt structure coming out of the spinoff was absolutely beautiful. Matched their free cash flow and everything at such a low rate fixed the whole way out

You don't know your stock history nor do you understand how a mature business works.
Strong companies "hide KPI's" all the time. Apple stopped reporting units sold for iPhones, iPad and Mac units starting in 2019. They stated quarterly units sold no longer fully represented the strength and financial health of the company and that the market had matured. The stock got killed around this time for the same stupid reasons you give here. 7 years later the stock is up more than 1,000%.
Microsoft on the other hand has never reported how many Windows license units they sell each quarter. Samsung stopped reporting phone unit sales 7 years prior and Google has never reported units sold for it's smartphones. You would think those would be a very important KPI if Units sold were important to Apple, but it's not. There are so many examples of companies like Apple, Microsoft, Meta, Amazon, etc either not reporting certain KPI's or no longer reporting them.
Netflix is the clear subscriber leader in an industry that is maturing. They are raising prices (as are their competitors) and user growth in mature markets is no longer a "full representation of the strength and financial health of the company." The most obvious way to understand this is that Disney is doing the exact same thing as Netflix with Disney+ and WBD is doing the same thing with HBO Max. They both stopped reporting subscriber numbers. And Netflix's other big competitor Amazon Prime has NEVER reported annual Prime video user numbers.
So how can reporting this metric be SO important but yet the entire industry doesn't report it? Do you know how stupid that makes you sound? Almost as dumb as when you say "revenue growth is padded by price." Where did you get your business education from? I'm going to guess you've never once seen a demand curve before.

Everyone's talking about which franchises Paramount gets. I've been staring at the financing instead, because that's where this deal will actually be won or lost.
On Thursday Paramount launched syndication for a $7.5B incremental Term Loan B, and buried in the same press release: they intend to raise another \~$44.4B of secured debt on top of everything already committed.
The headline says "$110B deal" but that hides how it's funded, so let me walk through the stack.
Paramount is paying $31 a share in cash for WBD. On 2.51B shares outstanding (per the Q2 10-Q) that's \~$77.7B for the equity, a 147% premium to the $12.54 unaffected price. The $110B is enterprise value — it includes WBD's debt.
The money comes from four buckets. $47B of new equity: Ellison family + RedBird at $16.02 a share, plus three Gulf sovereign wealth funds and LionTree who put in money with no board seats and no governance rights. Larry Ellison personally guaranteed the equity piece. Then the debt: $54B committed from BofA, Citi and Apollo, the new $7.5B Term Loan B, and $44.4B of additional secured notes still to be raised. That's \~$153B of sources against \~$78B for the equity check. The other \~$75B goes to taking out WBD's existing $33B of gross debt, refinancing Paramount's own debt, and fees. (That last number is my arithmetic on their disclosed totals, not a company figure.)
What's left standing: a combined company with \~$77-80B of net debt — Morgan Stanley's estimate, from before the extra $7.5B. Against pre-synergy EBITDA that's 6-7x leverage. Management's 4.3x only works if the full $6B of promised synergies actually show up. S&P has Paramount on negative watch for a cut from BB+ to BB and doesn't see leverage below 5x until 2029.
The piece I can't stop thinking about is the $49B 364-day bridge sitting inside the committed debt. A bridge is meant to be temporary: you close, then you term it out into long-dated bonds. If credit markets don't cooperate when that wall comes due, or the combined cash flows can't support the refi, the entire structure is under stress within a year of closing.
And look at what services it. WBD did $1.88B of adjusted EBITDA last quarter on $8.7B of revenue. Linear networks revenue was down 17% ex-FX, domestic linear subscribers down 10%. The linear business is the cash cow behind this debt and it's structurally shrinking \~4-5% a year. Streaming did $3.1B of revenue (+10%) with $512M of EBITDA — growing fast, but nowhere near big enough to carry $80B of debt on its own yet.
The bull case isn't crazy, to be fair. Combine HBO Max and Paramount+ (Morgan Stanley sees 240M+ subs by 2030), take $6B+ of cost out, grow into the leverage the way cable did in the 2000s. 6x leverage has worked in media before, when the cash flows were stable.
But "stable" is doing a lot of work there. This needs three things to go right at once: the $6B of synergies (while releasing at least 30 films a year under the state AG settlement, which limits how much content cost you can actually cut), the $49B bridge termed out cleanly, and linear declining slower than the debt gets paid down.
What would change my mind: the bridge getting termed out into long-dated paper at a sane spread before close, or leverage printing below 6x in year one on reported results instead of synergy models.
Until then this looks like one of the most levered large-cap media deals ever attempted, funded by a guy whose father had to personally guarantee the equity check.

WBD really did have the best CFO in Wiedenfels. That debt structure coming out of the spinoff was absolutely beautiful. Matched their free cash flow and everything at such a low rate fixed the whole way out

You don't know your stock history nor do you understand how a mature business works.
Strong companies "hide KPI's" all the time. Apple stopped reporting units sold for iPhones, iPad and Mac units starting in 2019. They stated quarterly units sold no longer fully represented the strength and financial health of the company and that the market had matured. The stock got killed around this time for the same stupid reasons you give here. 7 years later the stock is up more than 1,000%.
Microsoft on the other hand has never reported how many Windows license units they sell each quarter. Samsung stopped reporting phone unit sales 7 years prior and Google has never reported units sold for it's smartphones. You would think those would be a very important KPI if Units sold were important to Apple, but it's not. There are so many examples of companies like Apple, Microsoft, Meta, Amazon, etc either not reporting certain KPI's or no longer reporting them.
Netflix is the clear subscriber leader in an industry that is maturing. They are raising prices (as are their competitors) and user growth in mature markets is no longer a "full representation of the strength and financial health of the company." The most obvious way to understand this is that Disney is doing the exact same thing as Netflix with Disney+ and WBD is doing the same thing with HBO Max. They both stopped reporting subscriber numbers. And Netflix's other big competitor Amazon Prime has NEVER reported annual Prime video user numbers.
So how can reporting this metric be SO important but yet the entire industry doesn't report it? Do you know how stupid that makes you sound? Almost as dumb as when you say "revenue growth is padded by price." Where did you get your business education from? I'm going to guess you've never once seen a demand curve before.

Everyone's talking about which franchises Paramount gets. I've been staring at the financing instead, because that's where this deal will actually be won or lost.
On Thursday Paramount launched syndication for a $7.5B incremental Term Loan B, and buried in the same press release: they intend to raise another \~$44.4B of secured debt on top of everything already committed.
The headline says "$110B deal" but that hides how it's funded, so let me walk through the stack.
Paramount is paying $31 a share in cash for WBD. On 2.51B shares outstanding (per the Q2 10-Q) that's \~$77.7B for the equity, a 147% premium to the $12.54 unaffected price. The $110B is enterprise value — it includes WBD's debt.
The money comes from four buckets. $47B of new equity: Ellison family + RedBird at $16.02 a share, plus three Gulf sovereign wealth funds and LionTree who put in money with no board seats and no governance rights. Larry Ellison personally guaranteed the equity piece. Then the debt: $54B committed from BofA, Citi and Apollo, the new $7.5B Term Loan B, and $44.4B of additional secured notes still to be raised. That's \~$153B of sources against \~$78B for the equity check. The other \~$75B goes to taking out WBD's existing $33B of gross debt, refinancing Paramount's own debt, and fees. (That last number is my arithmetic on their disclosed totals, not a company figure.)
What's left standing: a combined company with \~$77-80B of net debt — Morgan Stanley's estimate, from before the extra $7.5B. Against pre-synergy EBITDA that's 6-7x leverage. Management's 4.3x only works if the full $6B of promised synergies actually show up. S&P has Paramount on negative watch for a cut from BB+ to BB and doesn't see leverage below 5x until 2029.
The piece I can't stop thinking about is the $49B 364-day bridge sitting inside the committed debt. A bridge is meant to be temporary: you close, then you term it out into long-dated bonds. If credit markets don't cooperate when that wall comes due, or the combined cash flows can't support the refi, the entire structure is under stress within a year of closing.
And look at what services it. WBD did $1.88B of adjusted EBITDA last quarter on $8.7B of revenue. Linear networks revenue was down 17% ex-FX, domestic linear subscribers down 10%. The linear business is the cash cow behind this debt and it's structurally shrinking \~4-5% a year. Streaming did $3.1B of revenue (+10%) with $512M of EBITDA — growing fast, but nowhere near big enough to carry $80B of debt on its own yet.
The bull case isn't crazy, to be fair. Combine HBO Max and Paramount+ (Morgan Stanley sees 240M+ subs by 2030), take $6B+ of cost out, grow into the leverage the way cable did in the 2000s. 6x leverage has worked in media before, when the cash flows were stable.
But "stable" is doing a lot of work there. This needs three things to go right at once: the $6B of synergies (while releasing at least 30 films a year under the state AG settlement, which limits how much content cost you can actually cut), the $49B bridge termed out cleanly, and linear declining slower than the debt gets paid down.
What would change my mind: the bridge getting termed out into long-dated paper at a sane spread before close, or leverage printing below 6x in year one on reported results instead of synergy models.
Until then this looks like one of the most levered large-cap media deals ever attempted, funded by a guy whose father had to personally guarantee the equity check.

All for WBD and Data centers 😂

I hold a few long and short WBD options (both in- and out of the money) in a few of my Wealthsimple and IBKR accounts. Assuming that the merger with Paramount goes through this week at $31 per share, will there be any fees that Wealthsimple/IBKR charges to cash-out these options at their intrinsic value?
Also, Wealthsimple has somewhat weird rules about auto-liquidation of expiring options, etc., so I wonder if there is any danger there? I am hoping that once everything is finalized, trading of WBD will halt, and everything will get frozen (including margin), but perhaps there is something that I am not aware of with how these brokers handle acquisitions?