Paramount said the transaction has now either been approved or has not been challenged by authorities across 66 jurisdictions.

  • The CMA concluded the transaction does not raise a realistic prospect of substantially lessening competition in the U.K. and will not be referred for an in-depth Phase 2 investigation.
  • The regulator reviewed the companies' overlap in theatrical film distribution, subscription video-on-demand services, children's television channels and audiovisual content production and licensing.
  • The regulator said the combined company would remain competitive despite becoming the UK's largest theatrical film distributor, citing rivals including Universal, Disney and Sony.

Shares of Paramount Skydance Corp. (PSKY) and Warner Bros. Discovery Inc. (WBD) were in focus on Thursday after the U.K.’s Competition and Markets Authority (CMA) cleared Paramount's proposed $110 billion acquisition of Warner Bros. Discovery.

Paramount said the transaction has now either been approved or has not been challenged by authorities across 66 jurisdictions. The company also noted that it has secured antitrust clearances in the U.S., European Union and several other major markets, bringing the deal another step closer to completion even as it continues to face a lawsuit from a group of U.S. state attorneys general seeking to block the merger.

The CMA had set Aug. 7, 2026, as the deadline for its initial review of the deal, to decide whether the proposed merger had any competition concerns.

Paramount Skydance shares were up 0.3% in Thursday’s pre-market trade, while Warner Bros. Discovery shares rose 1%.

What The CMA Found

The CMA concluded the transaction does not raise a realistic prospect of substantially lessening competition in the U.K. and will not be referred for an in-depth Phase 2 investigation.

The regulator reviewed the companies' overlap in theatrical film distribution, subscription video-on-demand services, children's television channels and audiovisual content production and licensing.

The regulator said that while the combined company would become the UK's largest theatrical film distributor, it would continue to face competition from major studios including Universal, Disney and Sony, along with smaller distributors.

It also found that consumers would continue to have alternatives in children's programming through free-to-air television and streaming services, while Netflix, Apple, Disney, Amazon Prime Video and broadcaster-owned platforms such as BBC iPlayer and ITVX would remain competitive in the streaming market.

Paramount said the CMA's findings reinforce its position that the transaction does not raise antitrust concerns, noting the U.K. regulator reached conclusions similar to those of the European Commission, which approved the deal last month.

WBD Reports A Mixed Q2

Warner Bros. Discovery on Thursday reported a mixed second quarter, with earnings per share (EPS) of $0.06 beating Wall Street estimates of a loss of $0.1 per share, according to Fiscal.ai data.

However, its revenue of $8.72 billion missed the consensus estimate of $9.21 billion.

The company's Streaming segment was a bright spot, with revenue rising 10% to a record $3.08 billion. WBD attributed the growth to continued HBO Max subscriber expansion, new distribution agreements and higher ad-supported subscribers, despite the absence of NBA programming during the quarter.

PSKY’s Q2 Has Wall Street Divided

Paramount Skydance reported an EPS of $0.04 in Q2, missing estimates of $0.17, while revenue of $6.91 billion narrowly topped consensus expectations of $6.87 billion.

According to TheFly, Wall Street's reaction was mixed. UBS raised its price target to $18 from $10 while maintaining a ‘Sell’ rating, saying the quarter was largely in line and highlighted by cost-cutting. It cautioned that the proposed Warner Bros. Discovery acquisition brings leverage, regulatory and legacy television risks despite potential streaming synergies.

TD Cowen lowered its price target to $8 from $13 while keeping a ‘Hold’ rating, citing a longer timeline for resolving the Warner Bros. Discovery deal after a judge scheduled a trial for March 2027.

U.S. District Judge Araceli Martínez-Olguín has scheduled a 12-day trial beginning March 2, 2027, to hear lawsuits brought by a coalition of 12 states and the Writers Guild of America, which argue the merger would harm competition in Hollywood.

BofA also trimmed its price target to $9 from $11, with an ‘Underperform’ rating, arguing that Paramount faces a lengthy integration process that could become even more complex if the WBD acquisition is completed.

Paramount Skydance announced in February this year that it had entered into a definitive agreement with Warner Bros. to acquire the company. Paramount stated that it will pay WBD shareholders $31 in cash per share.

PSKY stock is down 35% year-to-date, while WBD stock is down 10%. The State Street Communication Services Select Sector SPDR ETF (XLC) is up 3% over the past 12 months, while the iShares Core S&P 500 ETF (IVV) is up 23%.

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