The streaming giant Netflix finds itself navigating a complex two-front battle in its pursuit of Warner Bros. Discovery. As the company faces intense questioning from U.S. lawmakers over potential market dominance, a fierce bidding war with a key competitor is unfolding simultaneously. For investors, the core dilemma is whether the acquisition can overcome significant regulatory obstacles and a competing hostile offer.
Financial Firepower and Shareholder Vote Loom
Netflix enters this contest from a position of financial strength. Its fourth-quarter 2025 results, disclosed on January 20, showed revenue of $12.1 billion, slightly surpassing forecasts. The company’s global subscriber base expanded to 325 million. To finance the potential takeover, Netflix has temporarily halted its share repurchase program and secured credit commitments totaling $42.2 billion.
The next critical milestone is a shareholder vote at Warner Bros. Discovery, which could occur as soon as March. Market analysts suggest uncertainty surrounding the acquisition’s outcome and the stance of antitrust regulators will likely keep share price volatility elevated in the interim.
Senate Hearing Raises Antitrust Concerns
Co-CEO Ted Sarandos faced a rigorous hearing before the Senate Judiciary Committee on Tuesday. Senator Mike Lee, who chairs the Subcommittee on Competition Policy, Antitrust, and Consumer Rights, voiced substantial antitrust reservations. He cautioned that Netflix appeared to be striving to become “the one platform to rule them all.”
Should investors sell immediately? Or is it worth buying Netflix?
In a robust defense of the proposed transaction, Sarandos contended that the merger would ultimately bolster industry competition and protect jobs. He distinguished the deal from typical media consolidations, arguing it did not create an “Ark of Noah problem” resulting in redundant assets. Instead, Netflix is targeting specific Warner assets, such as film studios, which it currently lacks. Management also pledged to maintain the traditional 45-day theatrical window for Warner films.
Political Landscape Shifts as Bidding Escalates
A surprising development emerged on the political front yesterday. U.S. President Donald Trump stated in an interview with NBC News that he would not personally intervene in the bidding process, directing the Department of Justice to review the case. This marks a shift from comments made in December 2025, which had hinted at a more direct presidential involvement.
Meanwhile, competitive pressure is mounting:
* Netflix has tabled a cash offer of $82.7 billion for the Warner studios and the HBO Max service.
* Paramount Skydance has presented a competing, hostile bid for the entire company, implying an enterprise value exceeding $108 billion.
To date, the Warner Bros. Discovery board has rejected the Paramount Skydance overtures and continues to favor a deal with Netflix.
Ad
Netflix Stock: Buy or Sell?! New Netflix Analysis from February 5 delivers the answer:
The latest Netflix figures speak for themselves: Urgent action needed for Netflix investors. Is it worth buying or should you sell? Find out what to do now in the current free analysis from February 5.
Netflix: Buy or sell? Read more here...
