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David Ellison’s Paramount Skydance is seen as the top contender to buy Warner Bros Discovery, with analysts and experts saying the tech scion’s access to deep pockets and Washington ties give him an edge in what could be the media industry’s biggest merger in years. Fresh off the Paramount-Skydance deal in August, the newly minted media mogul is eyeing one of Hollywood’s prized assets that is home to HBO, Warner Bros Studio and a streaming unit with more than 120 million subscribers. His $60 billion approach was rejected by Warner Bros Discovery on Tuesday, Reuters first reported. But the company has put a for-sale sign and attracted other potential suitors including Comcast, Netflix and Apple, according to media reports. POTENTIAL $74 BILLION VALUATION At $30 a share the price Bank of America analyst Jessica Reif Ehrlich estimates Warner Bros Discovery could fetch in a sale the company would be valued at about $74 billion, a figure analysts say could deter some bidders but remains within reach for Ellison, whose father Larry Ellison is the world’s second-richest person with a net worth of about $330 billion. Apple had $36.3 billion in cash at June-end and could easily raise debt to fund a takeover but it has historically avoided large deals its biggest remains the $3 billion Beats purchase. Netflix holds about $9.3 billion in cash and has never done a deal exceeding $1 billion, while Comcast’s $9.7 billion cash pile means any bid would likely rely heavily on debt or outside partners. “It seems that Paramount appears to be in pole position,” said PP Foresight analyst Paolo Pescatore. IN PARTS OR WHOLE? Unlike Paramount, the other companies are also likely to be more interested in parts of Warner Bros Discovery than the whole company, which will saddle its buyer with around $35 billion in debt and declining cable TV assets, analysts said. “The studio would make sense for Netflix and Apple. The TV networks would make sense for the Comcast spinoff, while the studio would make sense for what is left of NBCU,” eMarketer analyst Ross Benes said. Netflix co-CEO Ted Sarandos on Tuesday reiterated the streamer is not interested in buying traditional TV networks but he did not mention studios. “We’ve been very clear in the past that we have no interest in owning legacy media networks, so there is no change there,” he said during an earnings call. Apple has also shown little appetite for cable TV assets. Still, Warner Bros’ vast film and TV library, along with HBO’s acclaimed shows, would be a strong addition to Apple TV+. Comcast, meanwhile, is narrowing its focus to theme parks, streaming and core NBCUniversal film and TV assets by spinning off most of its waning cable networks. Buying Warner Bros would deepen that strategy, giving Universal’s parks access to lucrative franchises such as “DC Comics” and “Harry Potter”. TRUMP CARD David Ellison also enjoys a unique advantage over rival bidders his father’s close ties with U.S. President Donald Trump. Larry Ellison has long been a Republican mega-donor and one of the few high-profile tech executives who were openly supportive of Trump before last November’s election. Analysts say that could help ease regulatory concerns arising from Paramount’s potential buyout of Warner Bros Discovery – a deal that would hand control of a big swathe of U.S. cable networks as well as two crucial studios to Ellison. “If anyone does buy the whole thing, or even split it into two and buy the two bits, it’s going to have to have the blessing of the current U.S. administration,” said Clea Bourne, Head of Subject of Strategic Communications and Journalism at the Goldsmiths, University of London. “And that’s where the Ellisons stand out very easily, because their cart is very close to the administration.” Zaheer Kachwala, Harshita Mary Varghese and Aditya Soni, Reuters
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E-Commerce
On Wednesday, October 22, Tesla released its third-quarter earnings with a side of begging from CEO Elon Musk. The report and subsequent investors’ call was pretty standard. Tesla announced $28.1 billion in revenue, a 12% increase year-over-year (YOY) from $25.2 billion. A majority of Teslas revenue came, unsurprisingly, from automotive sales, which grew 6% YOY to $21.2 billion. Quarter three was the last push for U.S. customers to buy Tesla vehicles before the federal EV tax credit expired. However, it wasnt enough. Tesla failed to meet Wall Streets predicted $26.4 billion in total revenue, according to consensus estimates cited by CNBC. Its reported earnings per share also failed to make the mark, reaching 50 cents adjusted instead of the estimated 54 cents. Teslas net income fell 37% YOY to $1.37 billion and its operating income dropped 40% to $1.6 billion. The company blamed the latter on greater operating expensesdue to AI and other R&D projectsalong with increased deliveries and each vehicle costing more overall, thanks to factors like higher tariffs. Tesla shares (Nasdaq:TSLA) were down roughly 4% in premarket trading on Thursday. The stock price is up 15.74% year to date, slightly underperforming the Nasdaq Composite’s growth of 17.94%. Musk wants more control as he focuses on robots AI was one of the main topics of conversation in Teslas earnings call, while Musk also focused on robotaxis and his plan for Optimus humanoid robots. The call ended with a plea from Musk and CFO Vaibhav Taneja. On November 6, investors will vote on a $1 trillion compensation package for Muskwhich would be contingent on the company hitting certain milestones. Notably, the extra income would be in the form of Tesla shares, providing Musk with greater control over the company. “[There] needs to be enough voting control to give a strong influence, but not so much that I can’t be fired if I go insane,” Musk said. He then took aim at proxy firms Institutional Shareholder Services (ISS) and Glass Lewis, both of which are encouraging investors to vote against the new package. I just don’t feel comfortable building a robot army here and then being ousted because of some recommendations from ISS and Glass Lewis, who have no freaking clue, Musk stated. I mean, those guys are corporate terrorists.
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E-Commerce
In the midst of a federal government shutdown, the U.S. government’s gross national debt surpassed $38 trillion Wednesday, a record number that highlights the accelerating accumulation of debt on America’s balance sheet.It’s also the fastest accumulation of a trillion dollars in debt outside of the COVID-19 pandemic the U.S. hit $37 trillion in gross national debt in August this year.The $38 trillion update is found in the latest Treasury Department report, which logs the nation’s daily finances.Kent Smetters of the University of Pennsylvania’s Penn Wharton Budget Model, who served in President George W. Bush’s Treasury Department, told The Associated Press that a growing debt load over time leads ultimately to higher inflation, eroding Americans’ purchasing power.The Government Accountability Office outlines some of the impacts of rising government debt on Americans including higher borrowing costs for things like mortgages and cars, lower wages from businesses having less money available to invest, and more expensive goods and services.“I think a lot of people want to know that their kids and grandkids are going to be in good, decent shape in the future that they will be able to afford a house,” Smetters said. “That additional inflation compounds” and erodes consumers’ purchasing power, he said, making it less possible for future generations to achieve home ownership goals.The Trump administration says its policies are helping to slow government spending and will shrink the nation’s massive deficit. A new analysis by Treasury Department officials states that from April to September, the cumulative deficit totaled $468 billion. In a post on X Wednesday, Treasury Secretary Scott Bessent said that’s the lowest reading since 2019.“During his first eight months in office, President Trump has reduced the deficit by $350 billion compared to the same period in 2024 by cutting spending and boosting revenue,” White House spokesman Kush Desai said in a statement, adding that the administration would pursue robust economic growth, lower inflation, tariff revenue, lower borrowing costs and cuts to waste, fraud and abuse.The Joint Economic Committee estimates that the total national debt has grown by $69,713.82 per second for the past year.Michael Peterson, chair and CEO of the Peter G. Peterson Foundation, said in a statement that “reaching $38 trillion in debt during a government shutdown is the latest troubling sign that lawmakers are not meeting their basic fiscal duties.”“Along with increasing debt, you get higher interest costs, which are now the fastest growing part of the budget,” Peterson added. “We spent $4 trillion on interest over the last decade, but will spend $14 trillion in the next ten years. Interest costs crowd out important public and private investments in our future, harming the economy for every American.”The U.S. hit $34 trillion in debt in January 2024, $35 trillion in July 2024 and $36 trillion in November 2024. Fatima Hussein, Associated Press
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E-Commerce
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