• Elon Musk is reportedly in talks to invest $1 billion in Skydance (PSKY), the media company led by David Ellison, according to people familiar with the matter.
  • The potential investment comes as Skydance nears completion of its acquisition of Warner Bros. Discovery (WBD), a deal that will create a combined entity with roughly $80 billion in net debt.
  • A Musk-backed investment could ease financing pressure and forge closer ties between the tech billionaire and the Ellison family’s expanding media empire.

Elon Musk, the billionaire CEO of Tesla (TSLA) and SpaceX (SPCX), is considering a $1 billion investment in Skydance, the media company helmed by David Ellison, according to people familiar with the matter. The talks, which were first reported by Semafor, are preliminary and could still fall apart, the people cautioned, asking not to be identified discussing confidential negotiations.

The potential capital injection would arrive at a critical juncture for Skydance, which is in the final stages of its acquisition of Warner Bros. Discovery. The all-stock deal, valued at approximately $81 billion in equity and $110 billion including assumed debt, is expected to close as early as next week, creating a combined company with a portfolio that includes Paramount Pictures, Warner Bros., CBS, CNN and HBO.

Representatives for Skydance and Musk did not respond to requests for comment.

A Timely Lifeline

The combined company will carry roughly $80 billion in net debt, a burden that has raised questions among analysts about its ability to invest in content and compete with streaming giants like Netflix (NFLX) and Disney (DIS). Management has targeted at least $6 billion in annual run-rate cost savings within three years, but the integration of two storied Hollywood studios is expected to be fraught with execution risk.

A $1 billion equity investment from Musk would be relatively small in the context of the overall debt load—about 1.25% of the net-debt burden—but it could provide a symbolic vote of confidence and strengthen liquidity. The terms of the potential investment, including whether the money would buy new shares or existing ones, remain unclear.

The talks also highlight the deepening financial ties between Musk and the Ellison family. Larry Ellison, David’s father and the co-founder of Oracle (ORCL), invested approximately $1 billion in Musk’s 2022 acquisition of Twitter, now known as X. Larry Ellison also previously served on Tesla’s board.

Strategic Overlap

Beyond the balance sheet, a partnership could have strategic implications. On Tuesday, media investor John Malone predicted that SpaceX could invest $8 billion to $10 billion in Skydance and strike a global output deal for its entertainment content. Malone, speaking at a conference, described the move as a way for Musk’s companies to secure content for distribution across their platforms.

Such an agreement would blur the lines between content ownership and technology distribution, a trend that has accelerated as tech giants push deeper into media. Skydance declined to comment on Malone’s remarks, and Musk’s representatives did not respond to inquiries.

The potential investment comes as Skydance prepares to report its first quarterly results as a combined company. In its most recent quarter as a standalone entity, Paramount Skydance reported revenue of $6.91 billion, up about 1% year over year, and adjusted EBITDA of $1.10 billion, up 27%. The company raised its full-year adjusted EBITDA guidance to $3.8 billion to $3.9 billion.

Regulatory Hurdles Cleared

The Warner Bros. Discovery acquisition has already cleared significant regulatory hurdles. U.S. federal and overseas authorities approved the deal, though a lawsuit by 12 states led to a settlement that imposes additional commitments, including the creation of a News Editorial Independence Board to oversee CNN and CBS News. The settlement also addresses concerns about foreign investment, with Saudi Arabian, Qatari and Abu Dhabi sovereign wealth funds having helped finance the acquisition.

The deal’s closing would mark the culmination of a years-long effort by David Ellison, who will serve as chairman and CEO of the combined company. Ynon Kreiz, the former CEO of Mattel (MAT), will serve as co-CEO, responsible for day-to-day operations and integration.

For Musk, the investment would represent a further foray into media ownership. The billionaire has already taken a prominent role in the platform formerly known as Twitter, which he acquired in 2022. A stake in Skydance would give him influence over a vast array of film, television and news assets.

What’s Next

Investors will be watching for an official announcement or regulatory filing that would confirm the investment and disclose its terms. Until then, the talks remain speculative and could unravel. Skydance’s shares, which trade under the ticker PSKY, were up 2.3% in afternoon trading on Wednesday.

This article was updated to clarify that the $1 billion investment figure has not been confirmed by Skydance or Musk.