| |
| Hello Insiders!! Today’s Business newsletter covers: - 💰 Disney invests $60B in parks, cruises
- ✈️ Airlines drop on falling fares
- 📱 Bard to integrate with Gmail, Maps, and YouTube
If you enjoy reading this newsletter, please share it with your friends and colleagues. Make sure to continue reading for Quick Hits and the Knowledge Hub. Thank you!! Shriram
p/Shriram | |
| 1 | | Disney has unveiled plans to invest around $60B in expanding its theme parks, cruise lines, and resorts over the next decade, nearly doubling its commitment to this profit-generating division. The details of specific projects still need to be announced, but they will focus on high-return ventures, including domestic and international parks and cruise improvements. More: - Disney aims to add more cruise ships and a new home port in Singapore and has more than 1,000 acres of land available for park expansion.
- According to the corporation, possibilities include bringing Wakanda from the "Black Panther" property to life and debuting "Frozen" at the Disneyland Resort.
- This strategic investment demonstrates Disney's transition from traditional cable television revenue toward depending on its theme parks as the primary revenue generator.
- For the past three quarters, the operating income of the parks division has exceeded that of the linear TV company, pointing to a potential long-term change in their financial balance.
- Following this revelation, Disney's shares fell more than 3% on worries that additional park investments will strain free cash flow shortly.
Zoom Out: - The company's parks revenue has long been a source of optimism, helping to balance out the negative effects of its streaming business and other sectors.
- Travel analysts note a summer attendance decline at Disney's U.S. parks, including competitors, with data from a line-wait tracking company showing that the Independence Day weekend marked one of the slowest periods in nearly a decade at Walt Disney World in Orlando, Florida.
Q: What are your thoughts on Disney's shift from traditional cable television revenue to focusing on its theme parks as a primary source of income? Join the conversation here. |     | |
| 2 | | 
What the numbers say: The United States has seen a steady decline in airfares, with August's YoY drop of 13.3% continuing a five-month trend. Even though the U.S. Global Jets exchange-traded fund has increased 5.4% for the year, it is still down 19% from its peak in July. Major airline stocks like American Airlines and Southwest Airlines have also experienced significant declines as labor shortages and rising fuel prices make it challenging to raise fares. Relevance: Airlines that focus on domestic travel face challenges as more people choose European holidays over domestic trips, which impacts pricing power and fare stability in the face of rising fuel costs. Investor confidence is being impacted by this shift in travel preferences and worries about the sustainability of the leisure travel boom, while labor costs and rising fuel prices increase the pressure on airlines' operating costs. More data: Before the pandemic, business travelers comprised around 50% of airline revenues and 12% of passenger volume in the United States. However, variables causing worry include increased fuel costs, imminent wage increases due to new pilot contracts, and uncertainty surrounding post-pandemic travel spending. | | | |
| A message from our sponsor, Masterworks. |  | | Yes, this platform’s 77% return is an outlier – but the rest may surprise you The news is true: Masterworks’ 15th sale just weeks ago returned an impressive 77% to investors. While such a high return is an outlier for the blue-chip art investing platform, you might be wondering what their prior sales delivered. Glad you asked… Every one of their sales has returned a profit to investors, with 12 of them delivering double-digit returns, and 1 delivering triple-digit annualized returns. In full, Masterworks has over 300 paintings and their 15 exits have delivered: 32%, 39.3%, 36.2%, 27.3%, 9.2%, 33.1%, 21.5%, 17.8%, 13.9%, 35%, 10.4%, 325.5%, 4.1%, 17.6%, and 77.3%, net annualized returns*. Every sale but one outperformed the stock market in the period from when it was offered to when it was sold. With performance like that, offerings on the platform can sell out in minutes. However, Inside readers can skip the waitlist to join with this exclusive link. Skip the waitlist Performance of exited investments is not representative of artwork that has not yet sold and past performance is not indicative of future results. See important disclosures at masterworks.com/cd | |
|
| 3 | | By combining Bard, Google's AI chatbot, with a variety of Google services like Gmail, Maps, YouTube, Flights, and Drive, the company is expanding Bard's functionality and allowing it to access and give data from these sources. Despite these extensions, Google stresses its dedication to user privacy, making sure that private information collected by Bard won't be viewed by human reviewers or utilized for ad targeting as part of its plan to remain competitive in the AI market. More: - The competition from AI systems like OpenAI's ChatGPT and Microsoft's inclusion of comparable AI in its search engine and Microsoft 365 software is the reason for this expansion.
- The U.S. Justice Department has accused Google of abusing its search monopoly to restrict competition, which is the backdrop to Google's move to upgrade Bard's capabilities.
- According to Google, it dominates search because of its superior algorithms, but it faces growing competition in a world driven by AI.
- Google wants to offer customers more individualized and beneficial experiences by integrating Bard into its services, such as group trip planning and easy access to pertinent information.
| | | |
| 4 | | Intel CEO Pat Gelsinger asserts that Intel's technology will be pivotal in the growth of the AI computing sector, underscoring the company's progress in production tech and AI software development tools at its annual Innovation conference. Gelsinger also points out the widening reach of AI, extending beyond data centers to encompass new domains like personal computers, ushering in substantial opportunities. More: - The Intel 3 chipmaking technique will be released by the end of the year as part of Intel's quick manufacturing technology update strategy.
- Competitors like Taiwan Semiconductor Manufacturing Co. and Nvidia outperformed Intel in manufacturing and AI acceleration due to prior mistakes.
- Intel has made strides in developing accelerators, with the Gaudi2 product line retaining a competitive edge in some sectors.
- To speed up AI applications in PCs, Intel intends to include the first integrated "neural processing unit" in its new Core Ultra processors, which will be released in December.
- By 2025, Intel plans to introduce cutting-edge production, enter the foundry industry, and offer its factory network to outside clients.
| | | |
| A message from our sponsor, Sidebar . |  | | Ready to take your career to the next level? Make your transition successful by leveraging a Personal Board of Directors. A trusted peer group, with battle-tested perspective, and proven playbooks, to have real, tactical discussions with to propel you forward. With Sidebar, senior leaders are matched with a small group of highly vetted, private, and supportive peers to lean on for unbiased opinions, diverse perspectives, and raw feedback. - “Providing and receiving support from others who play a similar role to you is one of the best ways to grow your capabilities and succeed.” - Vice President, Roku
- “You’re the average of the people you keep closest; Sidebar helps you raise that bar.” - Global Director, Reddit
- “Tap into a new level of coaching support, professional development, and peer-driven accountability.” - Senior Director, Credit Karma
Why spend a decade finding your people – join the growing waitlist of over 5,000 top senior leaders, and apply to become a founding member today. Join the Waitlist | |
|
| 5 | | The new CEO of CNN, Mark Thompson, will concentrate on long-term sustainability by creating digital subscription companies around CNN.com and creating content for CNN Max to draw in a younger audience. With CNN leadership believing it can manage coverage of former president Donald Trump efficiently, easing a key concern, Thompson's goal is to make CNN a sustainable business over the next five years. More: - At The New York Times, Thompson's prior expertise included expanding the subscription digital business from fewer than 1 million subscribers to over 7 million, leading to considerable share price increases.
- Thompson intends to use the 149 million monthly unique visitors to CNN.com to grow digital subscription businesses and may also look into topic-specific subscription products and bundling possibilities.
- The difficulty facing Thompson is creating news programming for CNN Max to appeal to younger viewers and compete with the platform's entertainment offerings.
- After decreasing to $750M in 2022 due to losses related to CNN+, EBITDA for CNN is predicted to increase again in 2023, approaching $1B.
| | | |
| 6 | | TGS ASA plans to acquire PGS ASA, its Norwegian counterpart, in an all-stock deal, capitalizing on the rebound in offshore energy's need for geophysical data. The agreement, approved by the boards of both firms, will exchange 0.06829 TGS shares for every PGS share, giving TGS owners a roughly two-thirds stake in the combined company, which is expected to have a market value of $2.62B and $649M in net interest-bearing debt. More: - By incorporating PGS' fleet into its operations, this acquisition enables TGS to increase its geophysical data capabilities, coinciding with the expanding oil services industry as energy corporations raise their spending on offshore exploration.
- TGS and PGS stocks have declined to less than half their values from five years ago, with TGS shares falling by up to 7.1% in early trading in Oslo, while PGS stocks surged by as much as 16%.
- The transaction is expected to reduce supply chain risks and produce more than $50M in annual synergies.
- The combined business plans to refinance the $450M in senior notes and term loans issued by PGS.
- With the acquisition expected to occur in the first half of 2024, the merger agreements are scheduled to be completed in October.
| | | |
| 7 | | Quick Hits: - Big ideas demand a proven approach to product development. Revelry's process helps dev teams form and deliver 30-40% faster than industry standards.*
- Instacart's stock market debut saw its shares rise by 12%, closing at $33.70 per share, exceeding the IPO price of $30.
- The 41st Electron rocket launch from New Zealand failed about two minutes and thirty seconds after liftoff while transporting Capella Space's Acadia 2 satellite, which caused Rocket Lab's stock to decline for the first time in more than two years.
- BP has appointed Kate Thomson as interim CFO following the unexpected departure of CEO Bernard Looney, which led to a management shakeup.
- Global commodities trader Trafigura, which is being accused of defrauding $590M of nickel, is restructuring its executive team, marking the biggest restructuring since 2015.
- Optimize your cloud costs today. This practical guide explains the steps to implement FinOps practices and how to get buy-in from your team.*
*This is a sponsored listing. | | | |
| Upcoming Events | | SEP
28 | | Join TruEra's Webinar on AI Observability with former CMU professor Anupam Datta. | | | | | | | OCT
4 | | Join this free online and onsite event in Amsterdam and you'll hear from industry experts at Meta, Opera, AdGuard, Mozilla, Google, and more. | | | | | | | OCT
16 | | Meet Our Fund 5, Building and Investing in AI | | | | | | * This is a sponsored event | | | |
Term of the Day Agtech: The revolution in agriculture, where technology is used to improve production, efficiency, and sustainability, is called agtech. Question of the Week Do you share details about your salary with your coworkers? Join the conversation Today's Knowledge Hub Is Brought To You By Ready to take your career to the next level? Apply to join Sidebar, a highly-vetted and private community of small peer groups designed to support exceptional senior leaders in doing their best work. |
INSIDE BUSINESS LEADERBOARD (7 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 Aaron Crutchfield | |
| |
 | Join 790,000+ people on the premier blue-chip art investing platform, Masterworks. Skip the waitlist.
| |
|
 | Sidebar – Catalyze your career with a Personal Board of Directors. | |
|
| |
