According to Wccftech, Netflix Co-CEO Gregory K. Peters stated at the UBS Global Technology Conference that the company attributed zero value to the WB Games division within its $82.7 billion agreement to acquire Warner Bros. Discovery’s Streaming & Studios unit. Peters called the gaming division “relatively minor” despite it including studios and major IPs. This valuation stands in stark contrast to the division’s success with Hogwarts Legacy, which sold over 34 million units by March 2025 and was the best-selling game of 2023. The deal itself is now under threat from a competing $108.4 billion hostile bid by Paramount Skydance for the entire Warner Bros. Discovery company. Netflix’s comments mark a clear de-prioritization of the gaming assets it is set to inherit.
Netflix’s Gaming Blind Spot
Here’s the thing: this isn’t just about accounting. It’s a window into Netflix’s entire philosophy on gaming. They see it as a value-add for their core subscription service, not as a standalone, revenue-generating pillar. So getting a studio that just produced a chart-topping, billion-dollar franchise for “free” fits that narrative perfectly. But it also shows a potentially massive blind spot. They closed their only in-house AAA studio last year. Now they’re getting, at no cost on their books, proven studios that work with DC, Harry Potter, and Mortal Kombat. It’s a bizarre disconnect.
The Hogwarts Legacy Paradox
How do you call a division “minor” when it just broke a 14-year sales streak held by Call of Duty and Rockstar? That’s the billion-dollar question. Peters name-dropped Hogwarts Legacy as a positive example, but the underlying message is brutal. It basically says, “Your one-off hits are nice, but your overall business isn’t material to ours.” This has to be demoralizing for the teams at NetherRealm (Mortal Kombat) and the others. It also glosses over the real potential. WB Games has refocused on four powerhouse IPs. That’s a cleaner, more potent portfolio than most publishers have. Netflix seems to see the trees—individual game successes—but is willfully ignoring the forest of a structured, IP-driven games business.
A Deal in Flux and a Strategic Gamble
Now, all of this might be moot. Paramount Skydance’s $108.4 billion bid for the whole company throws a huge wrench in the works. And that bid comes from a company that actually gets gaming, with studios like Skydance Interactive and Skydance New Media working on Marvel and Star Wars games. The contrast couldn’t be sharper. One suitor sees gaming as a core, valuable asset. The other sees it as a freebie bonus. For Warner Bros. Discovery’s shareholders, that’s a pretty big difference in perceived value.
What Netflix Is Really Buying
So what’s the play? I think Netflix is being brutally pragmatic. They’re buying a streaming library and film/TV studios. Everything else is gravy. They’ll take the game studios and use them to make mobile-ish games based on Stranger Things or *The Witcher* to keep subscribers engaged. The idea of funding a $200 million AAA console game to sell 20 million copies at $70? That’s probably not on their roadmap. It’s a defensive, ecosystem-driven strategy versus an offensive, market-conquering one. In the end, they got a “free” gaming division. The real cost might be failing to understand what it could actually become.
