From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
MEDIA MEGADEAL
They don't call it Merger Monday for nothing. The shockwaves were felt from Hollywood to Midtown Manhattan starting on Sunday when reports trickled out that AT&T was ridding itself of WarnerMedia, less than three years after the telecom giant acquired the media empire then known as TimeWarner for $85 billion. That news was confirmed early Monday when AT&T said it would spin off Warner into a new joint venture with Discovery, to be run by Discovery CEO David Zaslav and owned by AT&T and Discovery shareholders. Shares of AT&T sank 8 percent after the deal was announced, as the company all but admitted that its attempt to become a major player in the media business was a failed experiment. AT&T also said it would cut its dividend for the first time in decades, further upsetting retail shareholders. Shares recovered later in the week on a pair of analyst upgrades that are based on the theory that a leaner, meaner AT&T could be a long-term buy.
RETAIL EARNINGS
"Customers clearly want to get out and shop." That's how Walmart CEO Doug McMillon accounted for the company's blowout earnings report this week. The world's largest retailer saw same-store sales rise by more than 6 percent in the quarter. Target's same-store sales were up 26 percent. Home Depot, up 31 percent. Lowe's, up 26 percent. Macy's, up 63 percent. Taken together, the retail earnings show that U.S. consumers, armed with savings and stimulus checks, are shopping like it's going out of style as the pandemic fades.
CRYPTO CRACKDOWN
Cryptocurrencies crashed back to Earth during a frenzied sell-off on Wednesday that hit all corners of the market. Bitcoin fell as much as 30 percent, touching $30,000 before rebounding; Ether fell as much as 40 percent; Doge was down as much as 20 percent. Shares of the newly- public crypto exchange Coinbase, widely seen as a proxy for Bitcoin, were down as much as 13 percent to a record low. The most recent spate of volatility came after China banned financial institutions from participating in any crypto-related business — a move that was widely expected but still jolted traders and even spread to the stock market. It's not just China cracking down on crypto. There are growing fears among crypto enthusiasts that the regulatory environment in both Europe and the U.S. is looking murky. For instance, the Biden administration proposed this week that cryptocurrency transfers of more than $10,000 will have to be reported to the IRS.
ELECTRIC PICKUPS
Ford says it took more than 20,000 reservations for the new electric F-150 in the first 12 hours since the pickup was revealed, sending shares of the Dearborn, Mich.-based company higher. As the cornerstone of Ford's $22 billion investment in electrification, the F-150 Lightning is one of the biggest bets yet by a major U.S. legacy automaker on the future of electric vehicles. Ford is pricing the Lightning aggressively — the base model comes in just below $40,000 with a 230-mile range — in a bet that it can compete head-on with Tesla's similarly-priced Cybertruck. That vehicle is still in development with plans for a release later this year. A third, much more expensive electric pickup made by the Amazon-backed startup Rivian is also expected in the next few months.
MILK WARS
Oatly, the Swedish maker of plant-based oat milk, soared in its public debut on the Nasdaq, opening at $22 after pricing at the high end of $17 and giving the Oprah-backed company a valuation of about $12 billion after its first day of trading. Sales of oat milk tripled in 2020, and the dairy lobby has taken notice. The industry group behind the iconic "Got Milk?" ads is launching a new marketing campaign framing milk as a natural sports drink with the tagline "You're Gonna Need Milk for That."
A rare magnum of Dom Pérignon Vintage 1961 champagne that was specially produced for the 1981 wedding of Prince Charles and Lady Diana has failed to sell during an auction. Danish auction house Bruun Rasmussen handled the bidding Thursday. The auction's house website lists the bottle as not sold. It was expected to fetch up to around $93,000. It is one of 12 bottles made to celebrate the royal wedding. Little was revealed about the seller. The auction house says the bids did not receive the desired minimum price.
The New York Times and President Donald Trump are fighting again. The news outlet said Wednesday it won't be deterred by Trump's “false and inflammatory language” from writing about the 79-year-old president's health. The Times has done a handful of stories on that topic recently, including an opinion column that said Trump is “starting to give President Joe Biden vibes.” In a Truth Social post, Trump said it might be treasonous for outlets like the Times to do “FAKE” reports about his health and "we should do something about it.” The Republican president already has a pending lawsuit against the newspaper for its past reports on his finances.
OpenAI has appointed Slack CEO Denise Dresser as its first chief of revenue. Dresser will oversee global revenue strategy and help businesses integrate AI into daily operations. OpenAI CEO Sam Altman recently emphasized improving ChatGPT, which now has over 800 million weekly users. Despite its success, OpenAI faces competition from companies like Google and concerns about profitability. The company earns money from premium ChatGPT subscriptions but hasn't ventured into advertising. Altman had recently announced delays in developing new products like AI agents and a personal assistant.
President Donald Trump says he will allow Nvidia to sell its H200 computer chip used in the development of artificial intelligence to “approved customers” in China. Trump said Monday on his social media site that he had informed China’s leader Xi Jinping and “President Xi responded positively!” There had been concerns about allowing advanced computer chips into China as it could help them to compete against the U.S. in building out AI capabilities. But there has also been a desire to develop the AI ecosystem with American companies such as chipmaker Nvidia.
U.S. sports betting is booming as NFL and college football fuel massive activity. BetMGM CEO Adam Greenblatt breaks down trends, growth, and what’s next.
President Donald Trump says a deal struck by Netflix last week to buy Warner Bros. Discovery “could be a problem” because of the size of the combined market share. The Republican president says he will be involved in the decision about whether federal regulators should approve the deal. Trump commented Sunday when he was asked about the deal as he walked the red carpet at the Kennedy Center Honors. The $72 billion deal would bring together two of the biggest players in television and film and potentially reshape the entertainment industry.
Disney's changes to a program for disabled visitors are facing challenges in federal court and through a shareholder proposal. The Disability Access Service program, which allows disabled visitors to skip long lines, was overhauled last year. Disney now mostly limits the program to those with developmental disabilities like autism who have difficulty waiting in lines. The changes have sparked criticism from some disability advocates. A shareholder proposal submitted by disability advocates calls for an independent review of Disney's disability policies. Disney plans to block this proposal, claiming it's misleading. It's the latest struggle by Disney to accommodate disabled visitors while stopping past abuses by some theme park guests.
