Company: WBD
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001437107-25-000096
Chunk: 130

Company: Warner Bros. Discovery, Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 8
Chunk 130
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Adjusted EBITDA - Corporate$(233)$(346)33 %33 %Depreciation and amortization99 82 Employee share-based compensation119 100 Restructuring and other charges31 11 Transaction and integration costs80 79 Facility consolidation costs5 — Impairments and loss on dispositions86 7 Operating loss$(653)$(625)

Corporate operations primarily consist of executive management and administrative support services, which are recorded in selling, general and administrative expense, as well as substantially all of our share-based compensation and third-party transaction and integration costs.

Adjusted EBITDA improved 33% for the three months ended March 31, 2025, primarily attributable to the release of previously recorded non-income tax reserves, lower facility costs due to office consolidations and closures, and lower securitization expense.

Inter-segment Eliminations

The following table presents our inter-segment eliminations by revenue and expense, Adjusted EBITDA and a reconciliation of Adjusted EBITDA to operating loss (in millions).

 Three Months Ended March 31, 20252024Inter-segment revenue eliminations$(765)$(449)Inter-segment expense eliminations(712)(508)Adjusted EBITDA - Inter-segment eliminations (53)59 Impairment and amortization of fair value step-up for content27 80 Operating loss$(80)$(21)

Inter-segment revenue and expense eliminations primarily represent inter-segment content transactions and marketing and promotion activity between reportable segments. In our current segment structure, in certain instances, production and distribution activities are in different segments. Inter-segment content transactions are presented at market value (i.e., the segment producing and/or licensing the content reports revenue and profit from inter-segment transactions in a manner similar to the reporting of third-party transactions, and the required eliminations are reported on the separate “Eliminations” line when presenting our summary of segment results). Generally, timing of revenue recognition is similar to the reporting of third-party transactions. The segment distributing the content, e.g., via our streaming or linear services, capitalizes the cost of inter-segment content transactions, including “mark-ups” and amortizes the costs over the shorter of the license term, if applicable, or the expected period of use. The content amortization expense related to the inter-segment profit is also eliminated on the separate “Eliminations” line when presenting our summary of segment results.

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LIQUIDITY AND