Netflix Inc (NASDAQ:NFLX, XETRA:NFC) held an analyst briefing this week to make the case that its proposed merger with Warner Bros. Discovery has a cleaner regulatory path than the competing Paramount Skydance bid, deploying its chief global affairs officer and a senior antitrust lawyer from Skadden to push the argument.
The core pitch framed the Netflix combination as a vertical tie-up between a distributor and a studio, the kind of pairing that has historically cleared regulators with less friction.
The Paramount Skydance deal, by contrast, was characterised as a horizontal merger between two major studios with overlapping interests in news and sports, drawing comparisons to the Justice Department's successful block of the Penguin Random House and Simon & Schuster combination.
Investment bank Wedbush remains sceptical that the argument fully holds, noting that Netflix and Warner Bros. Discovery do overlap in content production and streaming, and expecting significant regulatory scrutiny regardless.
The broader point, though, is that Netflix can afford to walk away. Its advertising business is on track to at least double to $3 billion in 2026, and the underlying operation needs no external boost. The same may not be true of Paramount Skydance.
Wedbush kept its outperform rating and $115 price target.