Stock Analysis on Net
Stock Analysis on Net

Warner Bros. Discovery Inc. (NASDAQ:WBD)

This company has been moved to the archive! The financial data has not been updated since November 4, 2022.

Analysis of Operating Leases

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An operating lease is treated like a rental contract. Neither the leased asset nor the associated liability is reported on the lessee balance sheet, but the rights may be very similar to the rights of an owner. The lessee only records the lease payments as a rental expense in income statement.

Adjustments to Financial Statements for Operating Leases

Warner Bros. Discovery Inc., adjustments to financial statements

US$ in millions

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Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Adjustment to Total Assets
Total assets (as reported) 34,427 34,087 33,735 32,550 22,555
Add: Operating lease right-of-use asset (before adoption of FASB Topic 842)1 — — — 736 205
Total assets (adjusted) 34,427 34,087 33,735 33,286 22,760
Adjustment to Total Debt
Total debt (as reported) 15,014 15,645 15,669 17,045 14,785
Add: Operating lease liability (before adoption of FASB Topic 842)2 — — — 736 205
Add: Operating lease liabilities, current (included in Accrued liabilities) 62 71 82 — —
Add: Operating lease liabilities, noncurrent (included in Other noncurrent liabilities) 567 592 621 — —
Total debt (adjusted) 15,643 16,308 16,372 17,781 14,990

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1, 2 Equal to total present value of future operating lease payments.

Warner Bros. Discovery Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios for Operating Leases (Summary)

Warner Bros. Discovery Inc., adjusted financial ratios

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Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Total Asset Turnover1
Reported total asset turnover 0.35 0.31 0.33 0.32 0.30
Adjusted total asset turnover 0.35 0.31 0.33 0.32 0.30
Debt to Equity2
Reported debt to equity 1.29 1.50 1.58 2.03 3.21
Adjusted debt to equity 1.35 1.56 1.66 2.12 3.25
Return on Assets3 (ROA)
Reported ROA 2.92% 3.58% 6.13% 1.82% -1.49%
Adjusted ROA 2.92% 3.58% 6.13% 1.78% -1.48%

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 See details »

2 See details »

3 See details »

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Warner Bros. Discovery Inc. adjusted total asset turnover ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level.
Adjusted debt to equity A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. Warner Bros. Discovery Inc. adjusted debt to equity ratio improved from 2019 to 2020 and from 2020 to 2021.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Warner Bros. Discovery Inc. adjusted ROA deteriorated from 2019 to 2020 and from 2020 to 2021.

Warner Bros. Discovery Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

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Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
As Reported
Selected Financial Data (US$ in millions)
Revenues 12,191 10,671 11,144 10,553 6,873
Total assets 34,427 34,087 33,735 32,550 22,555
Activity Ratio
Total asset turnover1 0.35 0.31 0.33 0.32 0.30
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Revenues 12,191 10,671 11,144 10,553 6,873
Adjusted total assets 34,427 34,087 33,735 33,286 22,760
Activity Ratio
Adjusted total asset turnover2 0.35 0.31 0.33 0.32 0.30

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

2021 Calculations

1 Total asset turnover = Revenues ÷ Total assets
= 12,191 ÷ 34,427 = 0.35

2 Adjusted total asset turnover = Revenues ÷ Adjusted total assets
= 12,191 ÷ 34,427 = 0.35

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Warner Bros. Discovery Inc. adjusted total asset turnover ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level.

Adjusted Debt to Equity

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Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
As Reported
Selected Financial Data (US$ in millions)
Total debt 15,014 15,645 15,669 17,045 14,785
Total Discovery, Inc. stockholders’ equity 11,599 10,464 9,891 8,386 4,610
Solvency Ratio
Debt to equity1 1.29 1.50 1.58 2.03 3.21
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Adjusted total debt 15,643 16,308 16,372 17,781 14,990
Total Discovery, Inc. stockholders’ equity 11,599 10,464 9,891 8,386 4,610
Solvency Ratio
Adjusted debt to equity2 1.35 1.56 1.66 2.12 3.25

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

2021 Calculations

1 Debt to equity = Total debt ÷ Total Discovery, Inc. stockholders’ equity
= 15,014 ÷ 11,599 = 1.29

2 Adjusted debt to equity = Adjusted total debt ÷ Total Discovery, Inc. stockholders’ equity
= 15,643 ÷ 11,599 = 1.35

Solvency ratio Description The company
Adjusted debt-to-equity A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. Warner Bros. Discovery Inc. adjusted debt-to-equity ratio improved from 2019 to 2020 and from 2020 to 2021.

Adjusted Return on Assets (ROA)

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Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) available to Discovery, Inc. 1,006 1,219 2,069 594 (337)
Total assets 34,427 34,087 33,735 32,550 22,555
Profitability Ratio
ROA1 2.92% 3.58% 6.13% 1.82% -1.49%
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Net income (loss) available to Discovery, Inc. 1,006 1,219 2,069 594 (337)
Adjusted total assets 34,427 34,087 33,735 33,286 22,760
Profitability Ratio
Adjusted ROA2 2.92% 3.58% 6.13% 1.78% -1.48%

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

2021 Calculations

1 ROA = 100 × Net income (loss) available to Discovery, Inc. ÷ Total assets
= 100 × 1,006 ÷ 34,427 = 2.92%

2 Adjusted ROA = 100 × Net income (loss) available to Discovery, Inc. ÷ Adjusted total assets
= 100 × 1,006 ÷ 34,427 = 2.92%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Warner Bros. Discovery Inc. adjusted ROA deteriorated from 2019 to 2020 and from 2020 to 2021.