Discovery Inc. closed out the fourth quarter—which could be its last before merging with WarnerMedia—with 22 million paid streaming subscribers.
The new total, which is being driven up largely by Discovery+, represents an increase of 2 million since the end of the third quarter. Looking slightly ahead, Discovery said its coverage of the Winter Olympics in Europe helped grow its paid subscriber totals at Discovery+ and that “well over half” of the new Olympics subscribers also engaged with Discovery+’s entertainment content.
Discovery said that it has now transitioned its entire Discovery+ subscriber base across Europe onto the same technology platform as the U.S., which is said will improve the user experience, reduce churn and enable an ad-supported offering in European markets beginning in March in the U.K.
"2021 was by all measures an exceptional year for our company, in which we achieved significant operational, financial, and strategic objectives. We grew our global DTC paying subscribers to 22 million, a tailwind for our strong distribution revenue growth of 11%, while global advertising revenues grew 10% due to continued strength in our key markets and share gains,” Discovery CEO David Zaslav said in a statement.
Discovery’s merger with WarnerMedia has already gained clearance from the European Commission and antitrust clearance in the U.S. Zaslav said that AT&T received a favorable private letter ruling from the IRS and that Discovery has scheduled a stockholder meeting for March 11.
“Following the vote, and assuming the deal is approved by our stockholders, we expect to be on track to close in Q2,” he said.
Discovery—which will become Warner Bros. Discovery after the merger closes—is expecting synergies from combining the separate tech platforms and marketing strategies for Discovery+ and HBO Max. The combined company’s streaming strategy will include subscription and advertising revenue, which could become a bigger part of the equation going forward. Zaslav suggested that the combined content libraries of Discovery and WarnerMedia could eventually be used to power a free, ad-supported streaming service or a free global digital network.
In likely its last quarter as a standalone company, Discovery reported total revenues of $3.19 billion, up 10% year over year, and total adjusted OIBDA of $1.14 billion.