The telecoms giant confirmed the deal as it also reported that trading is “on the right track” despite a dip in revenues for the past year.
In February, the group said it was in exclusive negotiations with the US media giant after completing a lengthy review of its BT Sport operation. It confirmed it will now form a 50-50 joint venture which will bring together BT Sport and Eurosport.
BT said the two brands will initially stay separate but will ultimately be brought “together under a single brand in the future”.
The London-listed firm said it will immediately receive £93 million from Warner Bros Discovery, and up to £540m if future conditions are met.
The confirmation came as BT told shareholders it met expectations with a 2 per cent increase in earnings to £7.6 billion for the year to March, as cost savings offset lower revenues.
It said it will extend its cost savings plans to save £2.5bn by the end of 2025, amending previous targets of £2bn in savings by 2024.
Cost reductions have helped the company absorb some inflation pressures, it added.
Revenues for the year dropped by 2 per cent to £20.8bn, driven by lower sales in its enterprise and global businesses, although the firm benefited from a strong performance by its Openreach network business.
It added that its consumer business, which is focused around the EE mobile brand, returned to growth in the final quarter.
John Moore, senior investment manager at wealth firm Brewin Dolphin, said: “BT has been through a highly challenging period, but today’s results tentatively suggest there are signs of more encouraging times ahead for shareholders.
“The joint venture with Warner Bros Discovery is a potentially exciting development in a highly competitive market and continues to differentiate BT’s entertainment offering. Meanwhile, Openreach’s strong performance and the reinstatement of the dividend, despite the expected dip in revenues, are also positives.”
Walid Koudmani, chief market analyst at financial brokerage XTB, noted: “While the general market sentiment remains uncertain, today’s report appears to have inspired confidence when it comes to the future performance of BT.”
BT chief executive Philip Jansen said: “BT Group has again delivered a strong operational performance thanks to the efforts of our colleagues across the business.
“We have finalised the sports joint venture with Warner Bros Discovery to improve our content offering to customers, aligning our business with a new global content powerhouse.
“Separately, we have strengthened our strategic partnership and key customer relationship with Sky.”
Jansen also said the company has not seen customers axing subscriptions in response to cost-of-living pressures.
“No, we haven’t seen anything to suggest we are seeing that yet,” he said. “We have been consistent that we recognise the pressure across all our customers so we are focusing hard on prioritising value for money.
“We have made a necessary increase to prices but have improved what people can get for that cost as well.”