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Today's big stories

Disney’s CEO brought the firm to a high polish last quarter
Here’s everything you wanted to know about AI and Big Tech – Read Now
Japan's carmaking giant Toyota spent last quarter in the fast lane, zooming ahead with some excellent results

Spring Cleaning Came Early

What’s Going On Here?

Disney’s results earlier this week showed that the firm’s getting a thorough spruce up.

What Does This Mean?

Activist investors had been circling Disney, but returning CEO Bob Iger blew a pretty loud raspberry at them this week. Iger announced 7,000 job cuts and revealed plans to slash expenses by $5.5 billion – sending a clear message that he doesn’t need any outside help getting the house in order. And the results backed him up: Disney's theme park business smashed it out of the, well, park, and raked in a better-than-expected $9 billion in revenue. And although Disney’s streaming service dropped more than two million users last quarter, the segment still inched closer to turning a profit. Activist Nelson Peltz took the hint, calling off his boardroom-seat fight the following day.

Why Should I Care?

Zooming out: All change.
Iger also announced that the company’s reorganizing into three distinct businesses: Disney Entertainment (for the TV and binge-streaming crowd), Parks (for family holidaymakers), and ESPN (a colossal sports network, and the odd one out). That three-way split wasn’t lost on analysts: ESPN was once an all-star performer for Disney, but it’s been acting more like a bench-warmer of late. And although the company swatted away rumors it might auction off the network, it won’t stop investors from wondering whether ESPN’s future is outside the Kingdom’s gate.

The bigger picture: Watch this space.
Cutting costs by $5.5 billion – equal to more than 5% of sales – sounds great for profit margins, but you have to wonder whether slashing costs like this is just a short-term move to fend off activists, or if Disney’s been really overspending. If this is just a short-term stunt, the ploy could end up harming Disney over time. But if the firm actually was that out of shape, keep an eye on its stock: Disney could be about to transform into a leaner, meaner, more profitable outfit.

You might also like: Those mass layoffs in tech don’t mean we’re driving into a recession.

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🙋 Ask a question

Analyst Take

AI, Big Tech, And All The Big Questions

By Paul Allison, Analyst

ChatGPT is everywhere right now.

It’s no surprise then that it’s had a lot of people wondering whether artificial intelligence (AI) is the next massive tech wave, and, if so, which companies are best positioned to ride it.

I hosted a busy Ask An Analyst session, about this and other Big Tech topics.

That’s today’s Insight: the questions you had, along with my answers…

Read or listen to the Insight here

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100 startups for the price of one

Early-stage startups can be a savvy investment, especially if you buy before the rest of the world.

Problem is, you’ll be taking a big risk by banking on a startup in its baby stages. After all, it won’t have had time to prove itself as a profitable venture – and, of course, an investment – yet.

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That could be a smart hedge. You’ll essentially have spread your bets, so even if a couple of those companies don’t pan out, you can still look to the more successful ones for your returns.

Top execs from Amazon, Facebook, Google, Stripe, and Coca-Cola have already bought in: now’s your chance to become a Nobody too.

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