Jul 16, 2026

Welcome back to What I’m Hearing, where there’s way too much going on for the dog days of summer.

Tonight, I’ve got a brief reaction to today’s Netflix earnings reveal (in a word: “Booooooo!”), and Julia Alexander will have a full breakdown of the numbers on Monday. Tomorrow morning, Eriq Gardner and I will both be watching the first court hearing in The State of California et al. v. Paramount Skydance Corporation and Warner Bros. Discovery, Inc. You can too.

On that topic: I’m sure you saw that judge Araceli Martínez-Olguín denied a preliminary injunction today in the separate case brought by Paramount+ subscribers, which may or may not signal how this Joe Biden appointee sees the antitrust landscape. That case is much weaker, and tomorrow’s T.R.O. hearing in the states’ case presents only the issue of whether to temporarily stop the WarnerMount deal from closing, not the larger question of whether Rob Bonta & Co. are likely to win at trial. I’d bet on the T.R.O. being granted, or it’s possible Martínez-Olguín determines an injunction hearing can take place before WarnerMount closes or integration begins. This is a relatively new judge without a track record on antitrust, but my friends from law school who took her path as a civil rights and public interest attorney (including for the ACLU) tend to view corporations, uh… skeptically.

Plus: I’ve got the details on A24’s urgent effort to keep Backrooms director Kane Parsons from bolting to Warner Bros. or Universal, including the biggest offer the indie studio has ever made to a filmmaker.

Discussed in this issue: David Ellison, Ryan Reynolds, Donna Langley, Chris Ferguson, Jenna Ortega, David Fenkel, Markiplier, Gunnar Wiedenfels, Casey Bloys, Robert Eggers, Mike Proulx, Dane Cook, J.J. Abrams, Renate Reinsve, Dave Portnoy, Ted Sarandos, Trevor Henderson, Jonah Hill, David Zaslav, Curry Barker, Chiwetel Ejiofor, Pam Abdy, Michael Morris, Josh Kushner, The Daniels, Glen Powell, Alex Kister, Greg Peters, Mike De Luca, Chris Nolan, Daniel Katz, Francesca Orsi, and… A24 dog collars.

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Let’s begin…

Thursday Thoughts...

Netflix and chill (the engagement reports): Let’s break out the Leslie Nielsen “Nothing to see here” meme for Netflix co-C.E.O.s Ted Sarandos and Greg Peters, who revealed today they will no longer tell us every six months what people are watching on Netflix. Definitely no issue with engagement, they insist, but yeah… those reports everyone obsesses over because they told us three years ago to obsess over them will just drop once a year now. Which, of course, suggests there is very much an issue with what the numbers are showing. “Netflix is running a familiar play when a metric gets uncomfortable: it shifts the spotlight,” wrote Forrester research director Mike Proulx. “Netflix says engagement is healthy. If that’s true, investors should want more visibility into it, not less.” Exactly.
More Netflix…: Projections of slower growth clipped the stock again today, so Netflix has now lost nearly half its value since October, when it first disclosed interest in buying Warner Bros. Yikes. The first-half viewing hours were up 2 percent, so not the disaster some were predicting, but assuming subscriber numbers grew in the quarter (again, Netflix doesn’t tell us anymore!), that’s likely a decline in time spent per member. And while TV viewing is up, film engagement is down again, Guggenheim analyst Michael Morris noted. In maybe the wimpiest move of them all, Netflix excluded video podcasts from its engagement report, so we can’t dunk on Dave Portnoy over how few people watched Pardon My Take. Sarandos, as predicted, is really leaning into the narrative that not all viewing hours are created equal. That’s smart. As I’ve said, Netflix is never going to beat YouTube at its own game, no matter how many food influencers or quack psychologists it signs up for shows. Better, more premium, and curated—that’s the winning argument to both advertisers and the Street, while also delivering the biggest and most attentive audience in subscription streaming.
Mike and Pam kick more cans: A fun parlor game on the Warner Bros. lot: Which movies will actually come out on the dates that studio heads Mike De Luca and Pam Abdy have scheduled them? Much was made yesterday of yet another delay for The Batman: Part II, this time to February 2028. But the more interesting punt is J.J. Abrams’s The Great Beyond, starring Glen Powell and Jenna Ortega, which was pushed from November to October 2027 after Abrams tested the movie in Orange County and the audience definitely had some notes. It joins recent Mike and Pam delays including The Bride! (from ’25 to early ’26, where it bombed), The Cat in the Hat (from March to November), and Jonah Hill’s Cut Off (from this month to… “unscheduled”). Legendary has also delayed Ryan Reynolds’s Animal Friends four separate times, most recently to January ’27 via Warners.
More…: People in town tend to joke about these delays as De Luca and Abdy problems due to creative issues. Not wrong. But the Warner Discovery finance team also has a heavy hand in the release calendar. C.F.O. Gunnar Wiedenfels hates frontloading the money to release and market films when he doesn’t absolutely have to, so Warners ends up pushing stuff around more often than other studios, and going more than four months—from One Battle After Another last September to Wuthering Heights in February—without a single release. That Gunnar-inflicted barren period could come back to haunt the WarnerMount deal now that prospective owner David Ellison has promised a steady conveyor belt of 30 movies a year from the combined studios. As the states’ lawsuit points out, Warner Discovery C.E.O. David Zaslav once promised 20 theatrical releases in 2024 yet ended up releasing only nine films that year. The 2023 strike crippled output, but the total was only 11 releases in 2025, so what’s to prevent a judge from looking at that recent precedent and throwing the broken promise back in Ellison’s face?
Box office over/under: Universal’s The Odyssey is surging after glowing reviews hit yesterday. I worry a little about World Cup mania, and that the frenzy to see this one in Imax could actually temper its opening weekend because the format is largely sold out. But I’ll still take the over on $100 million domestic.

And now to the battle over the ‘Backrooms’ guy…

Can A24 Keep Kane Parsons?

Everyone in town is fighting to sign the 21-year-old director of breakout hit Backrooms. Can A24 keep him in the fold by offering its richest deal ever, or will Warner Bros. or Universal swoop in for the steal?

Matthew Belloni

If we’re judging juice in town by who can get a studio head on a plane for a meeting, Kane Parsons definitely has it. A few weeks ago, Warner Bros.’s Mike De Luca and Pam Abdy flew from Burbank to the Bay Area (alas, it was commercial) for a meeting with Parsons and his reps in a rented conference room at the Hotel Petaluma, near the home where the red-hot 21-year-old filmmaker has been living with his mother. Parsons considered hosting the Hollywood people at his mom’s house, but the air conditioning wasn’t working.

Mike and Pam dangled the full major-studio pu pu platter, of course, just one suitor of many attempting to lure the YouTuber turned hitmaker in the wake of the still-shocking $364 million performance of Backrooms—the A24 psychological horror pic based on a 4chan meme and Parsons’s digital shorts—which was made for just $10 million. That movie, as well as Obsession, from comic and digital creator Curry Barker ($428 million via Focus Features), and the self-released Iron Lung, from YouTuber Markiplier ($50 million), have kicked off an almost comical frenzy of dealmaking this summer as copycat studio executives fall over themselves to not seem old—sorry, to capture the zeitgeist.

Alex Kister, the 22-year-old creator of YouTube psychological horror series The Mandela Catalogue, will direct a movie adaptation for Amazon’s United Artists label and Amblin. Trevor Henderson, a creature designer with a big digital following, has sold two projects in a month based on viral memes, Siren Head and Cartoon Cat, to Warners and Sony’s Tristar unit, respectively. Even Barker’s dad got a full trade story to reveal he’s shooting a short film with… Dane Cook. For better or worse, this gold rush is just getting started.

But while Barker’s next couple movies are already lined up, Parsons is a free agent and thus considered the big get. In the Petaluma meeting, the Warners execs floated a massive overall deal with both the film studio and HBO Max for television. (Business affairs is working up the official offer now.) Parsons, who told me in June that he watches more TV than movies, is said to be a big fan of HBO, and a separate Zoom meeting with its leaders, Casey Bloys and Francesca Orsi, happened today. Warners also just signed Chris Ferguson, who produced Backrooms and coordinated the shoot in Vancouver, to his own first-look deal. Perhaps tellingly, Parsons offered a statement of support in the announcement of the Ferguson deal this week: “I am very excited to continue collaborating with this lot,” Parsons said. Hmm…

That’s just the Warner Bros. courtship. Donna Langley, the NBCU Entertainment chair whose savvy in recruiting filmmakers led to this weekend’s The Odyssey from former Warners stalwart Chris Nolan, flew Parson to L.A. for a meeting earlier this month. Sony Pictures is setting up its own longshot get-together. And A24 is going hard after this one, almost certainly the most aggressively the indie studio has ever pursued a filmmaker. Which makes sense.

Backrooms is the biggest hit in A24 history, and the studio is standing at a crossroads of sorts. It was once forced to watch its arthouse filmmakers leverage their A24 hits into a major studio deal, like The Daniels (Everything Everywhere All at Once) got at Universal; or go elsewhere in search of bigger budgets, like Robert Eggers (The Witch and The Lighthouse) did for The Northman and Nosferatu at Focus Features. But now A24 is flush with ambition following its 2024 cash infusion from Josh Kushner’s Thrive Capital. Co-founders Daniel Katz and David Fenkel are guided by the $3.5 billion valuation that came with the new money, essentially forcing them to take bigger swings on more-commercial projects while also trying not to lose the street cred of the only studio “cool” enough to sell out of logo dog collars on its website. Very tough, and its recent A.I. deal with the extremely uncool Google certainly didn’t help.

Last year was… not great for New A24, with a string of flops like Eddington and Death of a Unicorn and Opus and The Smashing Machine. The Materialists, which grossed more than $100 million thanks to overseas audiences, and the $70 million–budgeted Marty Supreme, which nearly hit $200 million worldwide, did better but came nowhere near a Backrooms-style smash. In short, A24’s attempt to level up is a work in progress.

So… according to two sources, the A24 offer to Parsons is its biggest ever, structured as a three-year first-look deal with performance bonuses built in if he makes two movies from the deal, one of which is contemplated as a Backrooms sequel. One source told me that $65 million is the likely payday for Parsons, given what he wants to make, but the dollar amount is still being discussed. (A24 and Parsons’s reps declined to comment.) One wrinkle: A24 is attempting to include television in the first-look arrangement, but Kane’s team may want to hold that back, potentially setting up a TV deal elsewhere. Again, they’re still negotiating, and either Warners or another studio could swoop in for the steal.

Incidentally, Parsons still doesn’t have an agent, despite what I’m told is an inbox full of unread emails from suitors. It doesn’t seem like Kane’s in a rush to sign anywhere, preferring to let his managers at 3 Arts and lawyers at the Ziffren firm handle the various courtships. Parsons is emphasizing his desire to pursue mostly his own original projects, and since A24 helped him line up Chiwetel Ejiofor and Renate Reinsve for Backrooms, access to I.P. or actors or scripts—all of which a talent agency can be helpful in procuring—isn’t really an issue.

Parsons has said he’d like to make something based on the video game Portal, though that’s controlled by Valve, the owner of the digital gaming platform Steam, which has shown little interest in film or TV adaptations. (At one point years ago, J.J. Abrams thought he had a deal to adapt Portal, but Valve backed out.) At some point, Parsons’s reps will likely feel pressure from the Big Three agencies for a meeting, but that hasn’t happened. Parsons has been in London and Martha’s Vineyard with his girlfriend, I’m told, but a decision on his next moves should come before the end of the summer.

See you Monday,
Matt

Got a question, comment, complaint, or love for somebody as strong as Manohla Dargis’s love for ‘The Odyssey’? Email me at Matt@puck.news or call/text me at 310-804-3198.

Puck sports correspondent John Ourand and a rotating cast of industry insiders take you inside the executive suites and owners boxes where the decisions that shape the entire sports business are made. You’ll hear interviews with players, network execs, and everyone in between. The Varsity is an extension of John’s private email for Puck by the same name. New episodes publish every Wednesday and Sunday.

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