WBD · 10-Q · 2026Q2 · Full report

Income Tax Rate Changes

Warner Bros. Discovery, Inc. · 2026-08-06 · Importance 65 · Surprise 82 · No source text

Income tax benefit was $433 million in the second quarter and $647 million in the first six months of 2026, compared with tax expense of $866 million and $881 million in the respective 2025 periods. The improvement primarily reflected lower pretax book income, including the absence of the $3.0 billion 2025 gain associated with the Tender Offers, plus excess tax benefits from share-based compensation. The six-month 2026 tax benefit also included a book-tax difference on the $2.8 billion Netflix Termination Fee accrual. As of June 30, 2026, WBD recognized an immaterial income tax expense from OECD Pillar Two minimum-tax rules.

Key facts

• Income tax benefit (expense) was $433 million and $(866) million for the three months ended June 30, 2026 and 2025, respectively, and $647 million and $(881) million for the six months ended June 30, 2026 and 2025, respectively. source
• Deferred income taxes at June 30, 2026: $5,579 million (December 31, 2025: $6,383 million). source
• As of June 30, 2026, the Company’s reserves for unrecognized tax benefits totaled $2,393 million and were $2,356 million as of December 31, 2025. source
• As of June 30, 2026, the Company recognized an immaterial income tax expense for Pillar Two GloBE minimum tax. source

Impact estimates