Netflix grants Warner Bros. Discovery 7-day waiver to reopen deal talks with Paramount Skydance
Watch on YouTube ↗  |  February 17, 2026 at 14:24 UTC  |  5:49  |  CNBC
Speakers
David Faber — CNBC Anchor / Financial Journalist

Summary

  • Warner Bros. Discovery (WBD) has been granted a 7-day waiver by Netflix (NFLX) to negotiate a potentially superior deal with Paramount (PARA).
  • Paramount has indicated a willingness to pay "at least $31" per share, which is higher than the current implied offer, signaling a potential bidding war.
  • Netflix's stock has suffered significantly (down ~25%) amid the merger talks, suggesting shareholder disapproval of the acquisition; however, Netflix retains the right to match any offer.
Trade Ideas
Ticker Direction Speaker Thesis Time
WBD
LONG David Faber
Anchor, Squawk on the Street / Media Analyst 		"Warner Brothers stock price going up this morning... They've got their seven days now... [Paramount] indicated... they will pay at least 31, if not more." WBD is the target asset in a competitive bidding environment. The entrance of a second bidder (Paramount) with a specific price floor ($31+) creates an arbitrage opportunity and raises the valuation floor for WBD shares. LONG. The stock is reacting positively to the prospect of a higher bid ("superior proposal"). Regulatory/Antitrust intervention (Trump administration mentioned); the deal structure (LBO concerns regarding cable asset solvency). 0:35
NFLX
WATCH David Faber
Anchor, Squawk on the Street / Media Analyst 		"Your odds have to go down on Netflix winning... Look at that stock price... It has been brutal... now 25% [down]." The market has aggressively sold off Netflix on the news of this potential merger, viewing it as value-destructive or a distraction. If Paramount wins the bid for WBD, Netflix shares might experience a "relief rally" as the unpopular deal is taken off the table. However, Faber questions if Netflix will remain "disciplined" or chase the price up. WATCH. Await the end of the 7-day waiver to see if Netflix walks away (bullish for stock) or engages in a bidding war (bearish). Netflix management ego/lack of discipline leading to overpayment; general tech sell-off mentioned (AI/Bytedance concerns). 0:16
PARA
WATCH David Faber
Anchor, Squawk on the Street / Media Analyst 		"Your odds have to... go up on on Paramount... Will Paramount be able to address not just price but also some of these other concerns... particularly for Paramount's cable networks." Paramount is the "interloper" trying to acquire WBD. While their odds of winning are improving, Faber highlights significant structural risks regarding their cable assets (MTV, Nickelodeon) and the LBO structure, questioning if the entity would even be solvent by close. WATCH. The deal is complex and carries high execution risk due to the declining nature of legacy cable assets. Financing falling through; cable assets deteriorating faster than expected ("almost no longer be an ongoing entity"). 0:19