Just weeks ago, Paramount Global employees were optimistic about finally entering a more hopeful era thanks to the company’s long-awaited merger with Skydance Media. Management expected the $8 billion deal to close by the springtime.

But as the company gets set to re-enter the Wall Street spotlight Wednesday afternoon with its fourth-quarter earnings report, the skies have gotten cloudy. In the chaotic early phase of Donald Trump’s second stint in the White House, federal regulatory approval of the $8 billion Skydance deal is no longer considered a formality and Paramount faces a bind with CBS News. While the overwhelming sentiment on Wall Street, inside the company and in media circles is that the transaction will indeed close, the timeline and cost of a potential settlement with Trump are big variables in the equation.

Amid the deal saga, there is also the financial reality facing a legacy entertainment player in a...