Warner Bros Discovery drops 6% after losing NBA deal

Warner Bros Discovery (WBD.US) launched today's trading with a big bearish price gap. Stock is down around 6% at press time. Company's stock is taking a hit after NBA announced an 11-year deal worth $76 billion that awards streaming rights to Amazon (AMZN.US), NBC, which is owned by Comcast (CMCSA.US) and ESPN, which is owned by Disney (DIS.US). This means that multi-decade NBA partners TBS, owned by Warner Bros, and TNT have not been awarded NBA streaming rights under a new deal.

This was announced last week, but Warner Bros Discovery decided to use its incumbent matching rights and match an offer placed by Amazon. However, NBA announced yesterday in the evening that proposal made by Warner Bros Discovery did not match terms offered by Amazon, and that decided to proceed with a multi-year agreement with Amazon.

As this means Warner Bros Discovery losing a key piece of its sports content, stock has begun to receive recommendation downgrades.

Warner Bros Discovery (WBD.US) plunged after it lost NBA streaming rights. Stock launched today's trading with big bearish price gap, but has managed to recover slightly since. Source: xStation5