Brief
Skydance market cap falls below half of combined Warner Bros. Discovery and Paramount value
The newly merged Skydance Corp. saw its market cap drop to about $36 billion after a warrant distribution and technical price adjustment.
By Felo News Desk · Published
Skydance Corp., the entity created by David Ellison after acquiring Warner Bros. Discovery, posted a market capitalization of under $40 billion on Oct. 5, well below the combined $78 billion cash value of the former Warner Bros. Discovery and Paramount assets.
On Tuesday after market close, the New York Stock Exchange adjusted Skydance’s share price downward by 19.4 cents to reflect the issuance of roughly 471 million warrants that give holders of Paramount Skydance’s PSKY Class B shares the right to buy stock at $12 per share. The adjustment triggered automated sell‑offs by index funds holding the warrants, pushing the NYSE‑listed SKYD stock down 22 percent on Wednesday.
Skydance issued a press release Wednesday noting the warrants represent about 9 % of its Class B common stock. The company said the implied equity value, including the warrants, would have placed its market cap at $45.6 billion based on a $9.07 per share price, with the warrants themselves valued at roughly $1 billion for a total equity value of $46.6 billion. After the 22 percent drop, the market cap fell to around $36 billion.
Thursday saw a modest rebound, with SKYD closing up 2.8 percent at $7.26 per share, raising the market cap to $36.6 billion—not counting the warrants, which closed at $2.96 each.
Analysts and credit‑rating agencies expressed skepticism about Skydance’s ability to meet its projected cost‑savings of $6 billion annually over the next three years while maintaining a slate of more than 30 theatrical releases per year. The company also faces annual interest payments exceeding $6 billion and a net debt load near $80 billion after assuming Warner Bros. Discovery’s $33.1 billion debt and the $78 billion cash payment from Paramount.
Under the merger terms, Paramount paid WBD shareholders $31.01666668 per share, totaling about $78 billion, and assumed WBD’s debt. Skydance’s Class A stock is held solely by the Ellison family and RedBird Capital Partners, leaving Class B investors without voting rights on corporate governance.
Key facts
- Skydance’s market cap fell to under $40 billion on Oct. 5, 2026. (variety.com)
- A 471 million warrant distribution triggered a 22 percent stock drop on Wednesday. (variety.com)
- Interest payments for the merged company exceed $6 billion per year. (variety.com)
- Paramount paid $78 billion in cash to acquire Warner Bros. Discovery. (variety.com)
- Skydance’s net debt after the merger is nearly $80 billion. (variety.com)
Sources
- [1] variety.com — originally reported as “Skydance’s Market Value Is Currently Less Than Half What Warner Bros. Discovery and Paramount Combined Were Worth”
