Balance Sheet: Liabilities and Stockholders’ Equity

The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.

Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.

Warner Bros. Discovery Inc., consolidated balance sheet: liabilities and stockholders’ equity

US$ in millions

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Accounts payable	412)	397)	463)	325)	277)
Accrued payroll and related benefits	533)	494)	425)	484)	535)
Content rights payable	772)	528)	456)	384)	219)
Finance lease liabilities, current	58)	57)	47)	—)	—)
Other accrued liabilities	867)	714)	750)	695)	555)
Accrued liabilities	2,230)	1,793)	1,678)	1,563)	1,309)
Deferred revenues	478)	557)	489)	249)	255)
Current portion of debt	339)	335)	609)	1,860)	30)
Current liabilities	3,459)	3,082)	3,239)	3,997)	1,871)
Noncurrent portion of debt	14,420)	15,069)	14,810)	15,185)	14,755)
Deferred income taxes	1,225)	1,534)	1,691)	1,811)	319)
Finance lease liabilities, noncurrent	197)	184)	203)	—)	—)
Other noncurrent liabilities	1,730)	1,835)	1,826)	1,040)	587)
Noncurrent liabilities	17,572)	18,622)	18,530)	18,036)	15,661)
Total liabilities	21,031)	21,704)	21,769)	22,033)	17,532)
Redeemable noncontrolling interests	363)	383)	442)	415)	413)
Series A-1 convertible preferred stock: $0.01 par value	—)	—)	—)	—)	—)
Series C-1 convertible preferred stock: $0.01 par value	—)	—)	—)	—)	—)
Series A common stock: $0.01 par value	2)	2)	2)	2)	1)
Series B convertible common stock: $0.01 par value	—)	—)	—)	—)	—)
Series C common stock: $0.01 par value	5)	5)	5)	5)	4)
Additional paid-in capital	11,086)	10,809)	10,747)	10,647)	7,295)
Treasury stock, at cost	(8,244)	(8,244)	(7,374)	(6,737)	(6,737)
Retained earnings	9,580)	8,543)	7,333)	5,254)	4,632)
Accumulated other comprehensive loss	(830)	(651)	(822)	(785)	(585)
Total Discovery, Inc. stockholders’ equity	11,599)	10,464)	9,891)	8,386)	4,610)
Noncontrolling interests	1,434)	1,536)	1,633)	1,716)	—)
Total equity	13,033)	12,000)	11,524)	10,102)	4,610)
Total liabilities and equity	34,427)	34,087)	33,735)	32,550)	22,555)

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).

Liabilities Trends

Current liabilities showed significant volatility, increasing sharply from 1,871 million US$ in 2017 to a peak of 3,997 million US$ in 2018, then declining over the next two years before slightly rising again to 3,459 million US$ in 2021. This trend was influenced particularly by fluctuations in the current portion of debt, which spiked to 1,860 million US$ in 2018 before normalizing in subsequent years.

Noncurrent liabilities increased steadily from 15,661 million US$ in 2017 to a high of 18,622 million US$ in 2020, before declining to 17,572 million US$ in 2021. The noncurrent portion of debt remained relatively stable, hovering around 14,400 to 15,200 million US$, with a slight decline in 2021. Other noncurrent liabilities nearly tripled from 587 million US$ in 2017 to 1,826 million US$ in 2019 and then stabilized.

Total liabilities peaked in 2018 at 22,033 million US$, followed by a slow decline to 21,031 million US$ by 2021, reflecting overall management of debt and other obligations.

Accounts Payable and Accrued Items

Accounts payable increased steadily from 277 million US$ in 2017 to 412 million US$ in 2021, indicating growing short-term obligations to suppliers. Content rights payable showed a strong upward trend, nearly quadrupling from 219 million US$ in 2017 to 772 million US$ in 2021, which may suggest increased investment or obligations related to content acquisition.

Accrued payroll and related benefits decreased between 2017 and 2019 but rose again by 2021, returning close to its initial level of around 530 million US$. Other accrued liabilities and accrued liabilities both increased notably, with accrued liabilities rising from 1,309 million US$ in 2017 to 2,230 million US$ in 2021, signaling higher accrued expenses or obligations.

Deferred Revenues and Taxes

Deferred revenues nearly doubled from 255 million US$ in 2017 to 489 million US$ in 2019, followed by minor fluctuations, ending at 478 million US$ in 2021, possibly reflecting shifts in prepaid service revenues or contract-based income recognition.

Deferred income taxes displayed substantial volatility, peaking at 1,811 million US$ in 2018 and then declining steadily to 1,225 million US$ in 2021, which may reflect changing tax positions or the utilization of deferred tax assets or liabilities.

Lease Liabilities

Finance lease liabilities emerged in 2020, with current liabilities increasing slightly from 47 million US$ to 58 million US$ by 2021 and noncurrent liabilities around 200 million US$ during the same period, reflecting adoption of lease accounting standards or new lease obligations.

Equity Composition and Changes

Common stock remained relatively stable over the period, with minor increments in par value shares issued. Additional paid-in capital increased steadily from 7,295 million US$ in 2017 to 11,086 million US$ in 2021, indicating ongoing capital contributions or issuance at premiums.

Treasury stock increased in absolute value, moving from -6,737 million US$ in 2017 to -8,244 million US$ in 2021, suggesting increased stock repurchases or retention of shares by the company.

Retained earnings showed a strong upward trend, growing from 4,632 million US$ to 9,580 million US$, indicating cumulative profitability or earnings retention across the years.

Accumulated other comprehensive loss deepened slightly reaching -830 million US$ in 2021 after some fluctuation, reflecting unfavorable changes in items recorded directly against equity.

Total stockholders' equity increased substantially, from 4,610 million US$ in 2017 to 11,599 million US$ in 2021. Inclusion of noncontrolling interests brought total equity to 13,033 million US$ in 2021, reflecting overall strengthening of the equity base.

Overall Financial Position

The sum of total liabilities and total equity increased consistently from 22,555 million US$ in 2017 to 34,427 million US$ in 2021, demonstrating overall growth in the company's balance sheet size. While liabilities initially rose sharply, they trended downwards after 2018, with equity steadily increasing, indicating a shift towards a more equity-financed structure over the period under review.

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Warner Bros. Discovery Inc. (NASDAQ:WBD)

Balance Sheet: Liabilities and Stockholders’ Equity