Warner Bros. Discovery Inc. is informing the professional-sports teams whose games are carried on three of its regional sports networks that it wishes to cease operating the channels and exit the business, according to people familiar with the matter.

The three regional sports networks were inherited by Warner Bros. Discovery Inc. when it acquired control of the WarnerMedia assets from AT&T Inc. The channels—which are still branded as AT&T SportsNet—serve teams in Pittsburgh, Houston, Colorado and Utah—and carry baseball, basketball and hockey. 

In a letter sent Friday from the unit’s president Patrick Crumb—a copy of which was reviewed by The Wall Street Journal—teams were warned that “the business will not have sufficient cash to pay the upcoming rights fees,” people familiar with the letter said. The teams were also told that Warner Bros. Discovery “will not fund our shortfalls,” they said.

The letter proposes that AT&T SportsNet transfer ownership of the networks and programming rights to the teams for no purchase price consideration beyond a release by the teams of any future claims against the networks.

Bankruptcy is also on the table, the letter said. “Unless we can reach a deal to transfer ownership of the network (and the attendant rights)” by March 31, “our only realistic option is to file for chapter 7 liquidation,” the letter to the respective teams said.

“We find ourselves running out of time and options,” the letter said. 

The affected teams include the National Basketball Association’s Houston Rockets and Utah Jazz; Major League Baseball’s Pittsburgh Pirates, Houston Astros and Colorado Rockies; and the National Hockey League’s Pittsburgh Penguins, the people familiar with the matter said.

The NBA, MLB and NHL are also being informed by Warner Bros. Discovery of the situation, the people said.

AT&T Sports Networks also owns a minority stake in an additional regional sports network controlled by the Seattle Mariners, which isn’t part of this proceeding, they said.  

The move by Warner Bros. Discovery to seek an exit strategy from the regional sports-network business had been in the works for some time, people familiar with the company said. The business has never been a priority for Warner Bros. Discovery, which is dealing with a heavy debt load and challenges in both its television and streaming businesses, the people said.

Regional sports networks were once the envy of the media industry, due in part to the high distribution fees they command from cable and satellite operators. But the rapid acceleration of cord-cutting has hit sports channels particularly hard, and many are challenged to continue to pay the rights fees to teams in return for carrying their games.

Diamond Sports Group, the nation’s largest operator of regional sports networks, has indicated that it might have to file for bankruptcy because of lower-than-expected revenue and rising rights fees to teams. Last week, Diamond said it missed a $140 million interest payment. The company, a subsidiary of Sinclair Broadcast Group Inc.,

has total debt of more than $8 billion.

The sports leagues and teams are all having to reassess what was once a cornerstone of their business, said Curt Pires, president of the Cap Sports Group, a consulting firm.

“I think the model of [regional sports networks] owned by third parties controlling or buying as many games as they own today will change as contracts come available. The leagues will look to reduce the number of games teams’ control and take that inventory and create additional national packages either on linear or streaming,” Mr. Pires said.

Write to Joe Flint at Joe.Flint@wsj.com