The move is a massive blow to the exhibition industry, which had been using "Tenet" as an anchor for its reopening plans.
"Our goals throughout this process have been to ensure the highest odds of success for our films while also being ready to support our theater partners with new content as soon as they could safely reopen," Toby Emmerich, chairman of Warner Bros. Pictures Group, said in a statement.
"We're grateful for the support we've received from exhibitors and remain steadfast in our commitment to the theatrical experience around the world. Unfortunately, the pandemic continues to proliferate, causing us to reevaluate our release dates," he said.
This is the third time that the studio has been forced to delay the tentpole feature due to concerns over Covid-19.
"Studios and theaters are unfortunately at the mercy of market forces beyond their control and with the pandemic causing continued uncertainty, it should come as no surprise that major releases like 'Tenet' are being moved or even postponed until further notice," Paul Dergarabedian, senior media analyst, at Comscore said.
"Tenet" is no longer expected to have a conventional release and could open first in overseas markets where cinemas can safely reopen. The company is expected to announce its official plans in the coming days.
This strategy comes with some pitfalls, as opening in only a portion of theaters can increase piracy concerns. Consumers hungry for new content might watch illegal copies of the film that would inevitably begin circulating.
Last year, the Global Innovation Policy Center estimated that worldwide online piracy costs the U.S. economy at least $29.2 billion in lost revenue each year.
With "Tenet" dropping off the calendar, Disney's "Mulan" is set to be the first major blockbuster to be released. It will arrive in theaters Aug 21. Although, it's likely that film, too, will move from its current release date.
Last week, less than 17% of the 5,440 movie theater locations in the U.S. were open to the public, according to data from Comscore. A little over a tenth of those cinemas were drive-in locations.
Heading into August, 24.5% of indoor cinemas are expected to be closed due to state regulations on what businesses are permitted to operate during the coronavirus pandemic.
Even if a large number of theaters were to open in time for "Tenet's" initial release, there were fears that moviegoers may not show up. According to a survey in mid-July conducted by Morning Consult, a global data intelligence company, only around 20% of consumers feel comfortable going to the movies right now.