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Warner Bros. Discovery (WBD) stock rose sharply Thursday as rumors swirled about a possible split of the company's cable networks from its studios and streaming businesses.

The stock gained as much as 6% during the day, closing at $9.01, after CNBC's David Faber reported that an announcement may come "in the not-too-distant future."

According to Yahoo, Faber suggested that WBD could separate its struggling cable channels, like CNN and HGTV, from its stronger streaming and studio businesses.

While the company has not confirmed these plans, it has been showing signs of change. Late last year, WBD split into two divisions — one focused on streaming and studios, and the other on cable networks.

This move was part of a larger plan to restructure the company, which is expected to finish in mid-2025.

"They've already done all of the reapportioning necessary," Faber said, pointing to the company's latest earnings report. For the first time, WBD broke down results by business segment, a step that often comes before a major change.

In the first quarter of 2025, Warner Bros. Discovery (WBD) announced a loss of $453 million. The company made $8.98 billion in revenue, which fell short of analyst expectations.

WBD Cable Revenue Falls 7%, Streaming Business Grows

WBD's cable business is facing difficulties, experiencing a 7% decline in revenue.

Linear advertising, which brings in money from traditional TV commercials, fell 11%, and earnings from cable dropped 14%.

Meanwhile, Warner Bros. Discovery's streaming business continues to expand. The company added 5.3 million new subscribers, reaching a total of 122 million.

Streaming revenue increased by 8% to reach $2.7 billion, while profits rose to $339 million, LA Times said.

CEO David Zaslav told analysts, "Our commitment to high-quality storytelling continues to be the engine that powers Warner Bros. Discovery." He declined to say whether a spinoff was happening but added, "We can move quickly if we decide to change."

Zaslav's team has been under pressure as younger viewers move away from cable TV. Traditional media companies like Disney and Paramount are also rethinking their cable strategies. Comcast, for example, is launching a new company called Versant to handle its cable networks.

WBD has about $38 billion in debt, though it paid off $2.2 billion in the first quarter. With cable viewership dropping and dealmaking in the media industry slowing due to high interest rates and political uncertainty, WBD may need to act soon.