Warner Bros. Discovery, Inc.WBD

Warner Bros. Discovery, Inc. Fair Value Disclosure

10-KFiled Feb 27, 20263 min read
FAIR VALUE MEASUREMENTS
Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants. Assets and liabilities carried at fair value are classified in the following three categories:
Level 1 - Quoted prices for identical instruments in active markets.
Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.
Level 3 - Valuations derived from techniques in which one or more significant inputs are unobservable.
The table below presents assets and liabilities measured at fair value on a recurring basis (in millions).
 
December 31, 2025
CategoryBalance Sheet LocationLevel 1Level 2Level 3Total
Assets
Cash equivalents:
Time depositsCash and cash equivalents$— $107 $— $107 
Equity securities:
Money market fundsCash and cash equivalents61 — — 61 
Mutual fundsPrepaid expenses and other current assets14 — — 14 
Company-owned life insurance contractsPrepaid expenses and other current assets— 2 — 2 
Mutual fundsOther noncurrent assets205 — — 205 
Company-owned life insurance contractsOther noncurrent assets— 105 — 105 
Total$280 $214 $— $494 
Liabilities
Deferred compensation planAccrued liabilities$66 $— $— $66 
Deferred compensation planOther noncurrent liabilities682 — — 682 
Total$748 $— $— $748 
December 31, 2024
CategoryBalance Sheet LocationLevel 1Level 2Level 3Total
Assets
Cash equivalents:
Time depositsCash and cash equivalents$— $95 $— $95 
Equity securities:
Money market fundsCash and cash equivalents46 — — 46 
Mutual fundsPrepaid expenses and other current assets16 — — 16 
Company-owned life insurance contractsPrepaid expenses and other current assets— 1 — 1 
Mutual fundsOther noncurrent assets216 — — 216 
Company-owned life insurance contractsOther noncurrent assets— 102 — 102 
Total$278 $198 $— $476 
Liabilities
Deferred compensation planAccrued liabilities$62 $— $— $62 
Deferred compensation planOther noncurrent liabilities650 — — 650 
Total$712 $— $— $712 
Equity securities include money market funds, investments in mutual funds held in separate trusts, which are owned as part of the Company’s supplemental retirement plans, and company-owned life insurance contracts. (See Note 17.) The fair value of the deferred compensation plan liability was determined based on the fair value of the related investments elected by employees. Company-owned life insurance contracts are recorded at their cash surrender value, which approximates fair value (Level 2).
In addition to the financial instruments listed in the tables above, the Company holds other financial instruments, including cash deposits, accounts receivable, accounts payable, senior notes, and a bridge loan. The carrying values for such financial instruments, other than the senior notes, each approximated their fair values as of December 31, 2025 and 2024. The estimated fair value of the Company’s outstanding senior notes, including accrued interest, using quoted prices from over-the-counter markets, considered Level 2 inputs, was $15,205 million and $34,876 million as of December 31, 2025 and 2024, respectively.
The Company’s derivative financial instruments are discussed in Note 13, its investments with readily determinable fair value are discussed in Note 10, and the obligation for its revolving receivable program is discussed in Note 8.
Free Sentinel

Want the next Warner Bros. Discovery, Inc. fair value disclosure the moment it drops?

Set a Sentinel and we'll alert you the moment Warner Bros. Discovery, Inc.'s next filing hits EDGAR. No credit card, your email never gets sold.

Track for free

Historical Timeline

Fiscal YearFiled
2025Feb 27, 2026Showing above
2024Feb 27, 2025
2023Feb 23, 2024
2022Feb 24, 2023
2021Feb 24, 2022
2020Feb 22, 2021
2019Feb 27, 2020
2018Mar 1, 2019
2017Feb 28, 2018
2016Feb 14, 2017
2015Feb 18, 2016

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

Income TaxesRevenueEarnings Per SharePP&EGoodwill & IntangiblesLeasesSegmentsDebtCommitmentsStock CompensationNew Standards