Warner Bros Discovery Inc (WBD.O) reported a quarterly loss on Friday due to expenditures related to its 2022 merger, dimming the streaming business’s first profit and sending shares down 5%.

The merger of WarnerMedia and Discovery Inc. resulted in a $1.81 billion charge and $95 million in restructuring charges in the first three months of 2023.

Warner Bros Discovery lost 44 cents per share, whereas Refinitiv data predicted a 1-cent profit.

The streaming segment, which includes HBO Max and Discovery+, earned $50 million pre-tax in the quarter, compared to a $227 million loss a year earlier. 1.6 million signed up.

That was a milestone for a losing segment trying to attract subscribers and a footing in the industry’s digital future.

CEO David Zaslav led media executives in limiting content spending for the company’s service to balance the expansion of the service with sustained investment in Warner Bros Discovery’s film and television business.

“We are not trying to win the direct-to-consumer spending war,” Zaslav said last year.

Walt Disney Co. (DIS.N) and other entertainment corporations have followed suit, trying to combine profitability and investing in new content to attract and maintain members in an uncertain economy.

Warner Bros Discovery’s new streaming service, “Max,” will combine HBO Max’s scripted content with Discovery’s reality programming on May 23. In addition, unscripted and children’s programming will broaden its appeal beyond HBO’s acclaimed and edgy series.

Refinitiv data shows Warner Bros Discovery’s first-quarter 2023 revenue was $10.70 billion, compared to analysts’ projections of $10.78 billion.

Warner Bros.’ March release “Shazam! Fury of the Gods,” a sequel to 2019’s “Shazam,” underperformed at the box office. The sequel grossed $133 million, significantly less than the original’s $368 million.

“It’s been over a year since Warner Bros Discovery completed its merger and it looks like David Zaslav is still figuring out the best way to move this combined company forward,” said Third Bridge analyst Jamie Lumley.

“With revenue dropping on an annual basis across all business segments and a swing to an overall net loss, it’s clear there is still a lot of work to do to get the company on firm footing.”

HGTV, Discovery, and TLC’s advertising income jumped 56%.