(Finance) – S&P Global Ratings has lowered theoutlook on Warner Bros.Discovery (WBD) to “negative” from “stable” and confirmed the rating of the issuer’s credit “BBB-“.
The negative outlook reflects the expectations that the WBD’s leverage will remain high in 2024 to 4.4x and will decline to 3.8x in 2025, which is above the 3.5x threshold for the rating. Additionally, the potential loss of NBA broadcast rights starting in the second half of 2025 could exacerbate an already challenging environment for its television segment and further pressure its deleveraging efforts in 2026 and beyond.
“WBD’s first half operating performance disappointed our expectations, mainly due to the continued decline in revenue and cash flow in its cable TV operations – the report states – Accordingly, we have lowered our guidance for 2024 and 2025 and now view WBD’s ability to organically deleverage to 3.5x in 2025 as more challenging.”
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