Plus, Third Point takes stake in Salesforce.
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Activist investor Nelson Peltz has called off his proxy fight at Disney, saying he is happy with the corporate restructuring efforts the company announced on Wednesday. Peltz's Trian Fund Management launched a proxy fight for a seat on Disney's board after the company rejected his request to join the board. More: - Peltz had criticized Disney's $71B acquisition of Fox in 2019, which occurred under Bob Iger.
- Peltz argued that Disney overpaid for the company.
- Peltz also criticized Disney's failed succession planning, which saw Bob Chapek removed from the role of CEO in November and Iger resume the role.
- Disney's shareholders were set to vote on the issue at the company's annual meeting in April.
- During its earnings call on Wednesday, Disney shared plans to cut 7,000 jobs and cut $5.5B in costs as part of a corporate reorganization.
- Disney reported $23.5B in revenue for its Q1 FY2023 earnings, up 8% YoY.
- Net income from operations was $1.3B, 99 cents a share, up 11% YoY, and EPS decreased to $0.99 from $1.06 reported same period the prior year.
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Crypto exchange Kraken will end its U.S. staking operation and pay a $30M fine to the SEC to settle an enforcement action alleging the firm sold unregistered securities. The SEC accused Kraken of failing to register the offer and sale of its crypto staking-as-a-service program. The program allowed investors to stake their crypto assets in exchange for returns of up to 21%. More: - According to the SEC, U.S. investors had more than $2.7B worth of crypto assets in Kraken’s staking program, earning the crypto firm about $147M in net revenue.
- In a statement, SEC chair Gary Gensler said crypto firms offering investment contracts in exchange for investors’ tokens must provide the proper disclosures and safeguards required by U.S. securities laws.
- Kraken said it would discontinue its on-chain staking services to U.S. clients but would continue the service for non-U.S. clients.
- On news of the settlement, Coinbase shares fell more than 14% on Thursday, closing at $59.63.
- Coinbase CEO Brian Armstrong said he believed that the SEC’s action in retail crypto staking would be a terrible path for the U.S.
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Commodities trader Trafigura Group said it was a victim of a systematic fraud that could cost it as much as $577M. The company said it thought it was buying containers full of nickel, but what it received did not contain the metal. Trafigura has accused the companies of metals trader Prateek Gupta of being behind the alleged fraud. More: - Trafigura said it has worked with Gupta’s companies in the past without any issues; however, in 2022, some red flags began to emerge.
- The commodities trader said there was no evidence that its employees were involved in the scam, and it had been deceived by false documents.
- Trafigura said it has started legal proceedings against Gupta and his companies which include TMT Metals and subsidiaries of UD Trading Group.
- Trafigura took a $577M impairment charge in its current financial period, which represents the maximum potential loss from the fraud.
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Netflix shared plans for its password-sharing crackdown. The company said over 100 million households were sharing accounts, which impacted its ability to invest in new programming. Netflix will first roll out its password-sharing restrictions to users in Canada, New Zealand, Portugal, and Spain. More: - Netflix said users would be required to set a primary location for their Netflix accounts and can have up to two sub-accounts for users who do not live in the home-base household.
- Users will pay an extra monthly fee for each sub-account.
- Netflix is also launching a new "Manage Access and Devices" page that would allow users to manage who has access to their Netflix account.
- Netflix said it would revisit and refine the new account management system based on user feedback.
- The company plans to roll out its password-sharing restrictions in the U.S. in March.
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ExxonMobil is creating a new business unit called Global Trading as part of a larger re-organization and cost-cutting strategy. The oil giant plans to leverage its oil and gas expertise to establish an energy and derivatives trading unit. More: - In addition to the global trading business, Exxon is also creating a unit to house its financial services and procurement business.
- The moves are part of a restructuring and consolidation strategy spearheaded by CEO Darren Woods.
- The re-organization is expected to cut structural costs by $9B by the end of this year compared to 2019.
- This includes savings from the thousands of job cuts announced during the pandemic.
- Last month, ExxonMobil reported a record annual profit of $55.7B and said it planned to spend as much as $35B on share repurchases this year and in 2024.
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Robinhood released its Q4 and full-year 2022 earnings on Wednesday, slightly missing on analysts’ expectations. The trading platform posted $380M in revenue, up 5% from the previous quarter and up 5% YoY. Robinhood narrowed its Q4 net loss to $166M from $423M reported during the same period in 2021 and from a loss of $175M reported in Q3 2022. More: - EPS was negative 19 cents, down from negative 20 cents reported in Q3 and negative 49 cents reported in Q4 2021.
- Robinhood reported $186M in transaction-based revenue, down 30% YoY.
- Robinhood co-founders Vlad Tenev and Baiju Bhatt canceled about $500M of their share-based compensation.
- Robinhood said its board has approved a plan to buy back FTX founder Sam Bankman-Fried’s ~7% stake in the company.
- Bankman-Fried purchased 55 million shares of Robinhood in May 2022 through Emergent Fidelity Technologies.
- Robinhood said it is working with the DOJ, which seized the shares in January, to recover the shares.
NOTE: Inside.com founder and CEO Jason Calacanis is an investor in Robinhood.
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- EBay and Yahoo both announced layoffs this week. Yahoo plans to cut 20% of its workers by the end of the year, and eBay plans to cut 4% of its workforce.
- Dan Loeb’s hedge fund Third Point has become the fifth activist investor to take a position in Salesforce. Other investors include Elliott Investment Management, Starboard Value, ValueAct Capital Partners, and Jeff Ubben‘s Inclusive Capital.
- EV startup Lucid announced a $7,500 purchase credit on some of its Air Touring and Air Grand Touring models. The move comes after a federal rule change disqualified Lucid’s Air sedans from receiving government tax incentives.
- The House passed a resolution in a 419 to 0 vote condemning China for violating the sovereignty of the U.S. This comes after the U.S. shot down a Chinese spy balloon off the coast of South Carolina over the weekend.
- Elon Musk announced Tesla would present its Master Plan 3 at the company’s investor day on March 1. The presentation will focus on “the path to a fully sustainable energy future for Earth.”
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 |  | Vanessa Omeokachie is a writer for Inside.com; she writes the daily Inside Business newsletter. Her interests include finance, technology, and entrepreneurship. In her free time, she enjoys reading, hiking, attending concerts and music festivals, traveling, and exploring. Connect with her on Twitter @VanessaOmeo or on LinkedIn. |   | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 and 1972 Fords. | |
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