The Big Picture

1. Paramount acquired Warner Bros. Discovery in $111 billion deal. The combined company will operate as Skydance
2. Merger brings together biggest brands in entertainment, from CBS and HBO to Harry Potter and SpongeBob SquarePants
3. Deal comes after a settlement with 12 state attorneys general that includes Skydance’s commitment to theatrical release minimums and increased U.S. spending

After months of speculation and controversy, two of Hollywood’s biggest studios are now under the same Sky(dance).

Paramount has officially completed its acquisition of Warner Bros. Discovery (WBD), creating a new entertainment juggernaut in Hollywood. The deal is valued at approximately $111 billion, comprising a purchase price of around $81 billion and $30 billion in assumed debt.

The combined company will operate as Skydance, with billionaire David Ellison at the helm. Ellison’s company Skydance Media, previously acquired Paramount in August 2025 in an $8 billion deal.

“From the start, our ambition was to bring these two storied studios together and create a stronger competitor, with the talent, resources, and reach to tell great stories in every genre, on every platform, for audiences everywhere. Now that ambition is a reality,” Ellison said in a statement Tuesday.

Skydance Media

Ellison will serve as chairman and CEO of the combined company, with former Mattel CEO Ynon Kreiz serving as co-CEO.

In Tuesday’s announcement, the company reaffirmed its commitment to release at least 30 “high-quality” films in theaters annually. This must include 20 wide releases, each year for the first two years following the merger, and come with a 45-day minimum theatrical window.

Studio output was a major sticking point for critics of the deal, including a coalition of 12 attorneys general, led by California AG Rob Bonta, who filed suit in July to block the merger over concerns of lowering studio output and effects on the workforce. Their settlement, announced in September, cleared the way for the deal provided that Skydance:

1. Release 32 films a year — with 21 wide releases — in years three, four, and five following the two years of 30 releases.
2. Paramount commits to release at least four independent films in each year of the commitment period.
3. Spend a minimum of $1.5 billion across five years over its 2025 U.S. spending levels.
4. Increase domestic production to 20% versus its current 5%, pending the passage of a U.S. film tax credit.
5. Commit to a $47.5 million fund for workers affected by the merger.
6. Skydance must retain both Paramount and Warner Bros. studio lots for at least five years

Failure to meet the annual film output requirement would require Skydance to divest Miramax Studios and pay a $30 million penalty per missed film.

The deal has also been met with criticism from both Hollywood and Washington, D.C. In April, more than 1,000 film and television professionals, including Mark Ruffalo, Denis Villeneuve, and Florence Pugh, released an open letter opposing the then-proposed merger.

Democratic senators Elizabeth Warren of Massachusetts and Cory Booker from New Jersey have also been vocal critics of the merger, with Booker saying in April that it would “cut jobs, jack up prices for consumers, choke free speech, and put outsized power in the hands of one mega corporation.”

President Donald Trump welcomed the deal’s completion on Tuesday, telling reporters that Skydance is “going to be a great company.” David Ellison’s father, Larry Ellison, is a well-known supporter of the president.

Tony Mariotti from Los Angeles, United States, CC BY 2.0, via Wikimedia Commons

Beyond the film studios, the merger places some of the biggest names in TV, streaming, and sports under Ellison’s watch. Attention now turns to the integration of assets like Paramount+ and HBO Max, and the future of the CBS News and CNN newsrooms under shared ownership. Currently, CBS News and CNN retain separate editorial heads.

Also top of mind is the possible layoffs as a result of the deal. While the attorneys general settlement aims to provide some protections for the workers affected, Variety reported Tuesday that Ellison and Kreiz acknowledged layoffs would be coming. Skydance has also stated it is targeting $6 billion in annualized savings within three years. With no formal announcement as of Friday, it remains to be seen how Ellison will handle the overlapping assets in studios, streaming, and news.

Just ten months ago, Warner Bros. looked to be on its way to Netflix after the streaming giant announced its plans to acquire the company last December. The deal would have included only WBD’s studio and streaming businesses, spinning off the cable networks in a similar fashion to Comcast’s Versant Media spin-off earlier this year.

Following months of back and forth, WBD walked away from Netflix’s offer after Paramount came back to the table, offering a $31-per-share valuation, including the cable businesses. Netflix then declined to raise its bid. Ultimately, shareholders received $31.02 per share when the deal closed on Tuesday, as Warner Bros. Discovery stopped trading on Nasdaq.