| Happy Friday, Insiders!! Today’s business newsletter covers: - Boeing posts $149M loss; Defense charges accumulate
- Analysis of how “Barbie” and “Oppenheimer” is boosting the box office
- Big Deal Round-Up
Also, if you want to see a topic discussed in the newsletter, let us know! If you find this newsletter helpful, please share it with your friends and colleagues.
Shriram
p/Shriram | |
| 1 | | In the second quarter, Boeing incurred a loss of $149M, contrasting with the $160M profit recorded in the previous year. However, the company surpassed analysts' expectations with an 18% increase in sales to $19.8B while also seeing a significant improvement in free cash flow to $2.6B. More: - The corporation added to its charges for problematic defense programs with an additional $514M in the most recent quarter.
- Another $257M was charged because the company's Starliner space taxi's first crewed voyage was delayed.
- Technical and supply-chain concerns caused the new T-7 Red Hawk trainer jet and MQ-25 refueling drone to be delayed, costing an additional $257M.
- The defense division of the American multinational company saw a solid quarter for foreign orders, especially for its helicopters, but it could not avoid additional costs on troublesome programs.
|     | |
| 2 | | 
What the numbers say: The historic box office pairing of Universal's "Oppenheimer" and Warner Bros. Discovery's "Barbie" occurred over the "Barbenheimer" weekend. $244.5M was made by the two films in their first three days in theaters, with $162M going to "Barbie" and $82.5M to "Oppenheimer." The weekend box office totaled $311M after including ticket purchases from other films, ranking as the fourth-highest weekend sum in history. Relevance: This weekend's success of "Barbenheimer" comes at a time when conventional franchise films are having trouble drawing crowds. Shawn Robbins, chief analyst at BoxOffice.com, stated, "Studios must be innovative and give creative people more freedom to explore as the industry changes." More data: Audiences raced to see the films on the big screen this weekend to experience a cultural moment, contributing to the movie's popularity. "Barbie" and "Oppenheimer" offered unique experiences, generating discussion and memes. Their momentum is anticipated to grow as word-of-mouth spreads and ticket sales increase in the coming weeks. | | | |
| 3 | | In the final week of July, notable M&A activity included Public Storage acquiring Simply Self Storage for $2.2B, while Thales purchased a U.S. cybersecurity firm for $3.6B. Panasonic agreed to supply anode materials to U.K. startup Nexeon for its Kansas Factory. MGM and Mariott partnered to enhance customer value by sharing rewards points. M&A: - Public Storage has agreed to purchase Simply Self Storage from Blackstone Real Estate Income Trust for $2.2B to expand its market presence.
- THG, owned by Matt Moulding, has acquired City AM, the London business newspaper, through a pre-pack administration sale after its owners decided to divest from the 17-year-old newsgroup.
- Eyeglasses giant EssilorLuxottica is expanding its business into hearing aids by acquiring Israeli startup Nuance Hearing, which developed acoustic technology for lenses.
- Thales plans to acquire Imperva, a U.S. cybersecurity firm, in a $3.6B deal to expand its presence in the battle against cyber threats.
Private Equity: - PacWest and Banc of California, two regional lenders in the U.S., have agreed to merge, with Warburg Pincus and Centerbridge set to invest $400M in newly issued equity.
Partnership: | | | |
| 4 | | Intel unexpectedly reported a profit for the quarter, despite a 12% decrease in revenue to $6.8B. The company expects adjusted earnings per share of $0.20 and adjusted income of between $12.9B and $13.9B for the third quarter. More: - As the PC market downturn showed indications of a turnaround with a lesser shipment dip, the company's stock increased by almost 6%, increasing its market worth by nearly $9B.
- In expectation of an industry revival, Intel shares have increased by around 30% this year, compared to a 50% jump on the Philadelphia SE Semiconductor index (.SOX).
- The foundry division, which accounts for the lowest portion of Intel's revenues, recorded revenue of $232M, up from $57M in 2017.
- Sales for Intel's data center and artificial intelligence division dropped from $4.7B to $4B, a 15% decrease from the prior quarter.
- Intel has noticed a rise in interest in its "advanced packaging" technology for high-performance computing and AI, and it anticipates an improvement in profit margins in the second half of the year.
| | | |
| 5 | | Microsoft and Alphabet reported strong performance in their core businesses during Q2, with Google seeing a bounce back in its digital advertising operations and Microsoft's cloud business performing well despite economic uncertainty. While Google's shares rose by 6% in after-market trading, Microsoft's stock fell nearly 4% after experiencing significant gains earlier in the year. More: - Both businesses anticipate increasing spending to construct data centers for fresh generative AI offerings in the upcoming quarters.
- In the most recent quarter, generative AI helped Microsoft's Azure cloud platform grow by one percentage point, and the company anticipates a two-point increase in growth this quarter.
- According to Ruth Porat, CFO of Alphabet, AI will be the main factor driving rising prices as they invest in data center infrastructure and accelerators like their TPU chips.
- Following recent employment losses, both businesses intend to be cost-conscious, and Alphabet's operating profit margin jumped to 35% due to better cost control.
| | | |
| 6 | | Netflix is revamping its collaboration with Microsoft to advertise at lower prices and attract more users to its $6.99 ad-supported plan monthly. In addition to Microsoft, Netflix is seeking to sell advertisements through other partners to attract new advertisers. More: - In recent ad negotiations, advertisers agreed to pay between $39 and $45 per 1,000 viewers, less than the $45 to $55 previously charged.
- At the end of June, the ad tier made up 3.3% of Netflix's U.S. members, up from 1.7% at the end of March.
- Although Netflix's ad revenue now contributes insignificantly to its overall revenue, the company plans to expand its ad business steadily.
- The ad market has been impacted by the economy's volatility and the decreased advertising budgets of some businesses.
| | | |
| 7 | | Quick Hits: - Don't miss your chance to invest in Virtuix, one of the fastest-growing startups in the booming gaming market. Invest by 8/10.*
- Tupperware's stock continues to surge, rising over 50% and increasing nearly 350% in the past five trading days, despite concerns about its business.
- Trucking company Yellow is in discussions with several potential buyers to sell Yellow Logistics to raise funds, causing its shares to initially rise in after-hours trading before closing down 44% at $0.57 per share.
- American Airlines' pilots union accepted a better labor deal after a richer agreement at United Airlines caused a delay in voting, with pilots at both companies still needing to vote on their tentative agreements.
- Economic growth in the U.S. exceeded expectations in Q2 2023 despite aggressive interest rate rises by the Federal Reserve, with an annualized growth rate of 2.4% reported by the Department of Commerce.
- Say goodbye to inflammation, joint pain, dry eyes, and discomfort by adding this Antarctic "supernutrient" to your diet.*
*This is sponsored content. | | | |
| Upcoming Events | | JUL
31 | | #TwoCents Discussion Community Challenge | | | | | | | AUG
2 | | Join Vanta and VioletX and find out how growing startups should navigate the complex compliance space.* | | | | | | | OCT
16 | | Meet Our Fund 5, Building and Investing in AI | | | | | | | NOV
7 | | Join us for Strategic Marketing 2023 and meet 300+ CMOs and senior marketing leaders from the world's biggest brands.* | | | | | | * This is a sponsored event | | | |
Term of the Day Brand equity: Brand equity is the value of a brand that is associated with the product or service that it offers. Question of the Week What's your stance on unpaid internships: valuable experience or exploitation? Join the conversation |
INSIDE BUSINESS LEADERBOARD (30 DAYS) |
 | Freelance Writer | | Shriram is pursuing Master’s in Business with Marketing at Warwick Business School. He worked as a Senior Consultant in Tech and Political Consultancies before his Masters. He is passionate about Tech, Marketing, Strategy, Anthropology and Politics. He is also the Postgraduate Ambassador for Warwick Business School. | | This newsletter was edited by Vibha Chapparike | |
| |
| |
