Netflix has agreed to acquire Warner Bros., a transaction that would fold the publisher's game development operations — including the teams behind the Mortal Kombat and Hogwarts Legacy franchises — into the streaming platform's gaming business.

The agreement, first reported by Video Games Chronicle, has not been disclosed in price terms, and a closing date has not been announced.

Warner Bros. Games is the Burbank-based publishing label that has overseen development of the two named franchises. The Mortal Kombat series is built by NetherRealm Studios in Chicago. Hogwarts Legacy, released in 2023, was developed by Avalanche Software in Salt Lake City, and the studio had been publicly attached to follow-up work on the franchise.

What does Netflix get from this deal?

• Two established console and PC studios with multi-platform shipping capability
• Active production pipelines on legacy IP
• Existing distribution arrangements across PlayStation, Nintendo, and Xbox
• A back catalogue spanning licensed and owned franchises
• Established live-service operations through Mortal Kombat's competitive scene

Netflix launched a games vertical in 2021, initially focused on mobile titles tied to its original programming. Since then, the company has expanded the division through studio acquisitions.

Bringing Warner Bros. Games under one roof would shift Netflix's gaming profile substantially, adding triple-A production history to a portfolio that has leaned toward casual and narrative experiences. The deal also brings live-service infrastructure through Mortal Kombat's competitive operations, a category Netflix has not previously operated at scale.

The acquisition would also expand Netflix's IP footprint at a moment when major entertainment companies are repositioning game studios as core strategic assets rather than ancillary businesses. For Netflix, whose subscriber growth has slowed, games represent one of the few remaining avenues for differentiation against competing streaming platforms.

What changes for the studios themselves?

NetherRealm and Avalanche operate from established offices and run multi-year development cycles. Day-to-day production is unlikely to shift in the short term.

The longer-term question is integration. Warner Bros. Games has historically operated with separation from the wider Warner Bros. Discovery corporate parent. That operating structure is what staff at both studios will be most attentive to under new ownership.

The acquisition also raises the question of how Netflix positions a publisher that has historically sold through third-party storefronts. Existing platform relationships are likely to be preserved through the transition, but the strategic calculus around exclusivity and timed deals could shift over time.

What signals are worth watching next?

Watch for a formal investor statement from either party, which would clarify the financial scale of the deal. The closing date remains unspecified, and the transaction will require regulatory review.

Quarterly disclosures from Netflix, where gaming currently appears as a small segment, will provide the first read on whether the division's priorities change once the Warner studios are integrated.

The acquisition, if completed, would mark one of the largest moves yet by a subscription entertainment platform into core games publishing. The closing timeline and post-close operating structure will determine whether Netflix treats Warner Bros. Games as a standalone label or accelerates integration into its existing games division.