Warner Bros. Discovery Earnings Look-Ahead: Focus on what lies beyond “Barbie”
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Warner Bros. Discovery (NASDAQ:WBD) is set to post second quarter earnings on Thursday and investors will focus on what lies in terms of growth beyond the success story of its recent box office hit âBarbieâ.
Wall Street analysts expect Warner Bros. Discovery to post loss per share of $0.08, while revenue is expected to grow 6.4% at $10.46 billion.
After Warner Bros. Discoveryâs release of "Shazam! Fury of the Godsâ and âThe Flashâ met with cold reception from movie-goers, Margot Robbie and Ryan Gosling starrer âBarbieâ remains the talk of the town, with the film staying on top of the domestic box office lists and grossing $93 million over the second weekend.
However, intensifying competition in the streaming space as well as a soft advertising market still remain the areas of concern for the media company.
Warner Bros. Discovery has been facing pressure in an increasingly competitive space for streaming services which includes rivals including Netflix (NFLX), Disney+ (DIS) and Amazon Prime Video (AMZN).
Following the footsteps of successful efforts at rivals like Disney+, the company in May unveiled its streaming service âMaxâ, which is a combination of HBO Max and Discovery+.
"I'll be curious to see whether ongoing cost-cutting measures and restructuring efforts are starting to pay off,â said Jesse Cohen, senior analyst at Investing.com.
While âBarbieâ and Christopher Nolanâs âOppenheimerâ made movie-goers flock to the theatres, box-office is still reeling from an inconsistent release slate and less ticket sales. Now, the strikes by Hollywood actors and writers could add to the owes for major studios.
A recent analysis at Seeking Alpha points out that the success of Barbie/Oppenheimer is a big win for the industry, but âstudios should savor the flavorâ, as it may be some time before this type of box office âtwin-killingâ can be seen again.
WBD, formed by the merger of WarnerMedia and Discovery Inc, also posted a 14% decline in first-quarter advertising revenue saw a decline of 14%, driven by soft advertising markets mainly in the United States.
Analysts are still bullish on the stock with Seeking Alpha analysts Wall Street and Seeking Alphaâs Quant Ratings considering the stock a âbuyâ. 
Over the last 2 years, Warner Bros. Discovery has beaten EPS estimates 50% of the time and has beaten revenue estimates 100% of the time.
The stock has risen over 30% so far this year.

Over the last 3 months, EPS estimates have been revised upward two times, compared to eight downward revisions, while revenue estimates have seen one upward revision versus 14 downward moves.