- Primary Subject: Netflix's withdrawal from the Warner Bros. Discovery (WBD) acquisition.
- Key Update: Netflix officially abandoned its $83 billion bid for WBD's studio and streaming assets after Paramount Skydance submitted a "superior" $111 billion offer.
- Status: Confirmed
- Last Verified: March 2, 2026
- Quick Answer: Netflix walked away because Paramount's $31-per-share offer made the deal "financially unattractive." Consequently, Netflix will receive a $2.8 billion breakup fee from WBD.
Despite Netflix's confidence in letting Warner Bros. Discovery take its pick between the streaming giant and Paramount's bidding war, the former bowed out of the competition. So, what gives?
Paramount Skydance outbid Netflix's $27.75-per share offer with a $31-per-share proposal, and yet, the losing company still walked away with its chin up high. Here's how it all went down.
Why Netflix CEO Ted Sarandos Pulled the Deal After Paramount
Paramount increased its offer last week (in a deal that includes its news and cable TV networks), leading spectators to believe that Netflix would fight to win the day, only to have Netflix back out as the asking price was "no longer financially attractive."
With that, Paramount's $111 billion megadeal for Warner Bros. Discovery is officially sealed.
In a new interview with Bloomberg, Netflix co-CEO Ted Sarandos revealed why the company decided against upping its bid and going all out in a war against Paramount's acquisition of WBD:
"We had a very tight range that we'd be willing to pay and made that offer back when we closed this deal," Sarandos told the outlet. "We hadn't moved much from that, except for moving to cash, which served to move the deal faster. I'm happy where we got in and happy where we got out."
Despite the seemingly instant decision, Sarandos noted: "We knew right away, when we got the notice on Thursday, that they had a superior offer and the details of that deal. We knew exactly what we were gonna do."
What Netflix Gained After Walking Away From WBD's Paramount Merger
Paramount may have struck the deal with the streaming giant, but ultimately, Netflix still won its own. Considering that the company's stock price increased in recent days, Paramount agreed to pay them a $2.8 billion cancellation fee, instead.
Thus, a win-win situation for the streamer, still, as they took a firm stance that they would no longer engage in "irrational" bidding wars, which actually caused their stock price to rise.
The most that Sarandos could say was that Paramount's merger with WBD should "be highly scrutinized" and that the brief battle was "unusual, irrational, whatever words you want to use in that."
Still, despite how things unfolded, Sarandos said, "It'll be fascinating to see the next steps. I have been on the record a lot in the last two weeks talking about what I think the future looks like."
"I'm confident in our future that we're not impacted by all that. In fact, maybe it's to our advantage. But I hope I'm wrong for the sake of the industry. " Sarandos added, sharing his belief that Warner Bros. Pictures might end up back on the market for bidding again, "Possibly. Or if you look at the history of Warner Bros..."
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