![]() The company has a 14+ year average maturity, meaning less risk in the short term from rising interest rates. That's ~25% of the company's EBITDA, showing the FCF growth that can come from paying down its debt. The company has an average cost of debt of 4.6% that's well protected from rising interest rates, costing the company $2.3 billion in annual interest. The company has $49.5 billion worth of gross debt, 94% of which is fixed. The company still has a massive amount of debt it needs to figure out how to handle. Unfortunately, we expect the company's advertising revenues not to recover as much due to a trend of advertising to move online. Advertising took a much more substantial impact as a larger division of the company. The company's network EBITDA remains stronger, with only a 10% drop, although revenue took a larger drop, even when removing the impact of the Olympics. The effects of the broader market downturn are clearly visible. The company did manage to decrease operating expenses and cost of revenue along with adjusted EBITDA by more than 20%. The company's studio revenue dropped 7% YoY due to primarily a mistiming in releases along with prior year theatrical successes. The company's per segment performance struggled with both films and networks. We'd like to see the company continue using its FCF to pay down debt, as a rising interest environment could make rolling over debt difficult. That's exciting to see after the multi-billion annual interest expenses the company incurred. The company's semi-annual interest payments totaled almost $900 million, meaning ordinary FCF would be positive. The company swung into negative FCF due to semi-annual interest payments and various expenses, along with struggles from Warner Media. Unfortunately, the company has dipped into negative free cash flow ("FCF"), which makes its position much tougher. The company had relatively strong financial results for a tough quarter and the overall EBITDA increased due to massive improvement in its DTC business. That's strong, the company's market cap to EBITDA is a mere 3x. However, the company managed to increase its adjusted EBITDA by 12% to $2.6 billion. That resulted in a 5% decline in the company's revenue without Elims. The company's revenues have been partially impacted by foreign exchange and the lack of income from the Olympics. Warner Bros Discovery Investor Presentation The company's financials have taken a hefty impact YoY. As we'll see throughout this article, the company can still generate substantial shareholder returns. ![]() ( T ) was with a substantial amount of debt into a tough market. The company has gone through several cycles of acquisitions and spinoffs, and its most recent spin-off from AT&T Inc. ( NASDAQ: WBD) is a $30 billion multinational media company known for its impressive legacy portfolio of assets. ![]()
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