Warner Bros. Discovery just realized its TV networks are worth $9.1 billion less than it originally thought, leading to a net loss of $10 billion in the second quarter of 2024.

The massive plummet in valuation is being recognized as a “non-cash goodwill impairment charge” primarily coming from the “Networks” section of the company. That must have been one eye-opening internal audit.

Wbd blames the devastating change in value to the “difference between market capitalization and book value” due to a soft U.S. advertising market and “uncertainty” surrounding future carriage deals. And oh yeah, the loss of the NBA certainly doesn’t help.

Wbd CEO David Zaslav said on Wednesday’s earnings call that market valuations two years ago when they first merged in April 2022, were “quite different than they are today,” and doing this “acknowledges” that change in value and “better aligns” them with their goals moving forward. CFO Gunnar Wiedenfels...