Not a must have: Netflix co-CEOs Ted Sarandos and Greg Peters explain employees decision to backout from Warner Bros deal at town hall

Netflix co-CEOs Ted Sarandos and Greg Peters reportedly held a brief town hall last week. This town hall was held to address Netflix employees following the streaming giant's announcement that it would not move forward with its planned acquisition of Warner Bros Discovery (WBD).

The failed deal was agreed upon by the two companies earlier in December 2025. The 15- to 20-minute session, moderated by Netflix Chief Communications Officer Dani Dudeck, did not include a Q&A section, a report claims.A Deadline report cited sources who claimed that Netflix’s co-CEOs had set a specific number for the film and TV studio and knew what it needed to be to make sense for the company. In justifying their decision to back out of the deal, Sarandos and Peters drew on a version of the line they had used in their reply to WBD's request for a higher bid the previous day, stating that acquiring Warner Bros “was always a 'nice to have' at the right price, not a 'must have' at any price.”

The town hall came after WBD’s board came back to Netflix with a recommendation to accept Paramount's higher price and asked the company to match it. Both Sarandos and Peters responded with a quick no. The two noted that they had done due diligence and did not feel the need to prolong the process once the number crossed the threshold they had set.In their remarks, both Sarandos and Peters sounded confident about the decision to walk away and laid out their reasons for doing so.

The town hall was called at short notice, mirroring a similar session held by Warner Bros Discovery earlier that same morning. The timing followed the WBD Board's declaration of Paramount's superior offer the previous afternoon, with Netflix withdrawing from the deal roughly 90 minutes later.The session also marked Netflix's second town hall that week, coming just days after the company had already held its regular quarterly town hall.

The reaction among Netflix staff to losing the Warner Bros deal is said to be mixed, with employees divided over the news, though the development caught most of them off guard at that time.“The office was quiet yesterday,” one person told Deadline.

What more did Netflix co-CEOs said to employees at the townhall

The two executives also pointed to a strong year ahead for Netflix and spoke about momentum building toward 2030, a milestone the company had been working toward.Sarandos and Peters went on to thank employees, including those who had spent the past month and a half working on integration planning that ultimately did not move forward, before asking staff to return to their regular work.While both executives showed restraint in walking away from the deal, that did not mean the outcome came without some disappointment. Sarandos had been open about how much he wanted the century-old studio. As Paramount's efforts to acquire Warner Bros gathered pace over the past few weeks, he took part in several interviews, making the case for Netflix's bid, and was in Washington DC for meetings related to the Netflix-WB deal when news of the WBD board's recommendation came through last week. However, Netflix did not leave empty-handed. The termination fee from the Warner Bros merger agreement, amounting to $2.8 billion, was paid to the streamer the same day.