Regulatory Hurdles Mount in High-Stakes Battle for Warner Bros. Discovery

The competitive landscape of the streaming industry is facing a potential seismic shift as two media titans, Netflix and Paramount Skydance, engage in a fierce bidding war for Warner Bros. Discovery (WBD). This contest, now under intense regulatory scrutiny on both sides of the Atlantic, represents one of the most significant challenges in Netflix's corporate history.

The financial terms of the duel are staggering. Netflix has structured a cash offer of $27.75 per share, valuing the enterprise at $82.7 billion, with an equity valuation of $72 billion. This proposal includes WBD's film studio, HBO, and the HBO Max streaming service, but notably excludes cable channels such as CNN.

Paramount Skydance has countered with a substantially higher, unsolicited bid exceeding $108 billion for the entire company, applying significant pressure on its rival.

Regulatory Scrutiny Intensifies

Authorities in the United States and Europe are examining the proposed mega-mergers closely, creating substantial obstacles. The European Union has initiated parallel reviews of both acquisition offers, a process expected to last several months.

In the U.S., the situation escalated during a Senate Judiciary Committee hearing on February 3, 2026. Netflix Co-CEO Ted Sarandos faced pointed questions, asserting the company holds "no political agenda" and that the acquisition would benefit consumers and the industry. Committee Chairman Mike Lee expressed skepticism, warning the deal could "further cement Netflix's dominance," while Senator Cory Booker inquired about Sarandos's meetings with former President Donald Trump.

Should investors sell immediately? Or is it worth buying Netflix?

Political Landscape Shifts

A notable development occurred on February 4, 2026, when former President Donald Trump stated he would not intervene in the takeover battle. In comments to NBC Nightly News, he declared, "The Justice Department will handle it." This marked a shift from his position in December 2025, when he had characterized the Netflix deal as potentially problematic and warned against excessive market concentration.

Market Reaction and Company Performance

The uncertainty surrounding the potential acquisition has weighed on Netflix's share price. Closing at $80.87 on February 5, 2026, the stock hovered just above its 52-week low of $79.22. The company's market capitalization currently stands between approximately $340 and $350 billion.

Operationally, however, Netflix continues to perform robustly. The company reported 2025 revenue growth of 16%, reaching $45.2 billion, with operating profit surging roughly 30%. For 2026, management targets revenue between $50.7 and $51.7 billion and an operating margin of 31.5%.

The coming weeks will be critical in determining whether Netflix can secure the largest acquisition in its history or if Paramount Skydance will prevail with its superior bid.