Company: WBD
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001437107-25-000096
Chunk: 103

Company: Warner Bros. Discovery, Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 8
Chunk 103
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21 $1,608 $47 $14 $25 $28 Net investment hedges: (a)Cross-currency swaps434 6 — — 6 421 6 — — 4 No hedging designation:Foreign exchange944 16 6 13 108 951 18 7 14 122 Cross-currency swaps216 2 — — 2 210 2 — — 1 Interest rate swaps1,500 1 — — — — — — — — Total return swaps443 — — 17 — 454 — — 16 — Total$61 $31 $61 $137 $73 $21 $55 $155 (a) Excludes €1,500 million of euro-denominated notes ($1,618 million and $1,558 million equivalent at March 31, 2025 and December 31, 2024, respectively) designated as a net investment hedge. (See Note 8.)Derivatives Designated for Hedge Accounting Cash Flow HedgesThe Company uses foreign exchange forward contracts to mitigate the foreign currency risk related to revenues, production rebates, and production expenses. As production spend occurs or when rebate receivables are recognized, foreign forward exchange contracts designated as cash flow hedges are de-designated. Upon de-designation, gains and losses on these derivatives directly impact earnings in the same line and same period as the hedged risk. These cash flow hedges are carried at fair market value on the Company’s consolidated balance sheets. Hedge effectiveness is assessed using the spot method, with fair market value changes recorded in other comprehensive loss until the hedged item affects earnings. Excluded components, including forward points, are included in current earnings.

17

WARNER BROS. DISCOVERY, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(unaudited)

The following table presents the pre-tax impact of derivatives designated as cash flow hedges on income and other comprehensive loss (in millions). Three Months Ended March 31, 20252024Gains (losses) recognized in accumulated other comprehensive loss:Foreign exchange - derivative adjustments$14 $16 Gains (losses) reclassified into income from accumulated other comprehensive loss:Foreign exchange - distribution revenue4 2 Foreign exchange - costs of revenues— 11 Interest rate