Morning Brew Daily - Elon’s SpaceX Buys Musk’s xAI & Will Bob Iger Actually Leave Disney This Time?

Episode Date: February 3, 2026

Episode 771: Neal and Toby cover Elon Musk’s merging of SpaceX and his AI company, xAI, and why this may be the most ambitious move yet. Then, Disney has a strong quarter thanks to its theme parks and streaming business (no surprise there), but it also plans its near succession of Bob Iger who plans to step down before his contract expires (hopefully). Next, Toby dives into the trend of minivans becoming the hottest vehicle coming off lots as millennial moms and dads need more space for their families. Meanwhile, a Youtuber who wrote, directed, and starred in his own self-funded movie has quietly dominated the box office.  Get your tickets for the Morning Brew Variety Show! https://tinyurl.com/MBvariety  Learn more about Sandals at sandals.com  Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Listen to Morning Brew Daily Here:⁠ ⁠⁠https://www.swap.fm/l/mbd-note⁠⁠⁠  Watch Morning Brew Daily Here:⁠ ⁠⁠https://www.youtube.com/@MorningBrewDailyShow⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

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pwc.com slash US slash brew AI. That's pwc.com slash us slash brew AI. Good morning brew daily show. I'm Neil Fryman. And I'm Toby Howell. Today, why is Elon selling his AI startup to his rocket company? Then minivans are so back. It's Tuesday, February 3rd.

Let's ride. Look, it's been a brutal winter out there in the tundra of New York. Temperatures didn't rise above freezing for nine straight days. This morning, it's colder heat. than in Newk Greenland. In Florida, they've got frozen iguanas falling out of trees and to top it all off, Phil the groundhog predicted six more weeks of this. And yet there's light at the end of the tunnel, literally. Over the next 28 days, we gain 77 minutes of daylight. And that's before daylight saving time begins on March 8th. Leaving the office and not having it be pitch black is a moment

to be celebrated and cherish. At this rate, you'll be sun tanning in no time. Speaking of rates, though, right now we are tracking, tacking on two minutes and 30 seconds of daylight per day. But that will rise closer to three minutes by the end of the month and peak around the March Equinox before slowing down in the summer. Never knew that it wasn't a consistent rate. So thank you to the old farmer's almanac for teaching me that. And now word from our sponsor, our very relevant sponsor, Sandals. This cold weather is really affecting my mood, Toby. For the better? No. This is the first time I've left my apartment. apartment in days. If only I were at a Sandals resort. Sandals adult-only resorts let you explore the

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terms at AKA.m.m.m.m. They're calling it the most ambitious mashup since DJ Earworms United States of Pop 2009. Elon Musk is combining two of his companies, the rocket giant SpaceX, and his AI startup XAI. The deal, which was announced yesterday, marks the collision of two supernovas in Musk's universe. And the term mega merger wouldn't do this justice.

SpaceX and XAI were two of the most valuable private companies in the world, and together, they'll form the biggest. In the deal, SpaceX is valued at $1 trillion, more than all but 11 public companies, while XAI was valued at $250 billion, also more than most public companies. The combined company will be worth doing some back of the napkin math here, $1.25 trillion. So what would it accomplish? According to Elon, the goal is to, quote, form the most ambitious, vertically integrated innovation engine on and off Earth with AI rockets, space-based internet, direct-to-mobile device communications, and the world's foremost real-time information and free speech platform. But analysts think it mostly comes down to one word, money. Infrastructure for artificial

intelligence, if you hadn't heard, is extremely expensive, and for that matter, so are rockets. Combining the two would be a tacit acknowledgement by Musk that some of his companies don't make financial sense on their own, and on top of that, SpaceX and XAI would complement each other nicely to bring data centers to space, a goal Elon said, is just a couple of years away. Toby, welcome to the MCU, the Musk corporate universe. The funniest memes that came from this mega merger is the fact that all these reports of SpaceX were in talks to acquire X-A-I, and everyone's like, who's he talking to himself? A tough negotiation.

Right. It's literally Elon negotiating with Elon, but this is a pattern. If you've watched Elon's career over the years, he loves. loves doing this in 2016. He used Tesla stock to acquire Solar City, which his cousin was running. Last year, he used XAI to acquire X. So this kind of Russian doll of corporate maneuvering is something that is an Elon trademark because this is how he likes to run his companies. He loves moving staff and resources in between companies in ways that most other corporations wouldn't do so. I remember reading the Elon Musk biography last year from Walter Isaacson, and he brings

in SpaceX engineers to work with the Twitter takeover, which you wouldn't think that those two businesses are very similar. But in the Muskiverse, he does like sharing resources like that. This is another instance, albeit the biggest one ever. Yeah, he really does love going Kirby mode. As Ryan Mack pointed out on X, that was, this was the third time that Elon Musk has bought Twitter in four years because he bought it for $44 billion by himself. And then he used XAI to buy Twitter. And then now he's using SpaceX to buy XAI, which also owns Twitter. So that is true. That is the third time in four years. Let's not lose sight of how daringly ambitious this is. Axios's Dan Pramak called it one of the most audacious moves in the history of business and tech,

arguably betting his empire on the idea of orbital data centers that are powered by the sun, because that is the through line through this SpaceX XAI merger. Elon Musk doesn't think that terrestrial data centers are going to do the job in terms of cost and they're going to run into land regulations and pushback. And he and a bunch of other leaders in the space think that the ultimate future for data centers that power AI are going to be in space. And now that's easy to say. But this is the ultimate goal with this with this $1.25 trillion dollar company is to build data centers in space, which is truly crazy to think about. Yeah. He thinks that XAI is going to benefit for the increased compute capacity of sending those data centers up

into orbit. He thinks Tesla's ability to manufacture energy storage could actually help SpaceX figure out this data center in space problem. And then he also has talked about using SpaceX Starships to carry Tesla Optimus robots to the moon and Mars and beyond as well. So that gives you just another peek into how his brain is working here, what that flywheel might look like. But all of it comes undone if you can't actually put data centers in space, which is still a big if, as much as it makes sense in terms of the fact that there's abundant energy and space up there, it's still a very difficult engineering problem. Some would say, yeah, to say the least, Elon probably might be the best person to attack that engineering problem, but if he can pull it off is the big

if in this scenario. You mentioned Tesla, which is kind of a big question mark here, because that's the other big crown jewel in Elon Musk's portfolio of companies. Tesla is not involved in this deal. It's just XAI and SpaceX. There had been rumors that Tesla would be merging, with SpaceX and XAI as well. The difference there is Tesla is a public company, and it wouldn't totally be Elon Musk negotiating against himself. XAI and SpaceX are private. When you bring Tesla into the picture, there are shareholders, there's Delaware's involved. You know, it gets to be a lot of paperwork, and Tesla is maybe, you know, moving towards a robotics future. So unclear where all of that, this fits in the entire constellation of Elon Musk. But, you know,

the trend line is convergence, as Elon admits himself. So it wouldn't be so crazy to see Tesla folded in there one day. And the one thing we also haven't mentioned is that SpaceX is planning to IPO later this year because it also needs a lot of fresh capital to do the rocket thing. And I guess that that IPO is going to be the biggest of all the time. And then you fold in another $250 billion company into it. It's going to be even bigger than that. Moving on yesterday, we talked about new CEOs taking over at Walmart and Target. it now another crown jewel of corporate America is preparing its own succession plans, Disney. This week, Disney's board is going to meet to select a replacement for Bob Eiger, who's held two

stints as Mouse in Chief. First was from 2005 to 2020, then from 2022 until very soon, it appears. Disney will hope to avoid repeating its succession debacle from 2020. Back then, Iger handed the keys to the Magic Kingdom to Bob Chapic, a decision he quickly regretted and reversed just three years later, firing his. fellow Bob in reinstalling himself as CEO. Now, as he prepares to retire again, Iger is confident Disney will undergo a smoother transition, mostly because of, according to him, how well he's done during his second stint in charge. Iger told CNBC, I think what is noteworthy is that when I came back

three years ago, I had a tremendous amount that needed fixing. But thanks to his repair job, the next CEO will be giving, quote, a good hand in terms of the strength of the company and a number of opportunities to grow. Disney is indeed clicking on many levels as a new air. era dawns. Yesterday, it reported a solid fourth quarter thanks to surging streaming income and an insanely profitable theme park division that makes more money than Scrooge McDuck. Toby, you can't screw this up twice, can you? You absolutely can screw it up twice. This has been a drag on Disney's stock for a while now because succession, success and succession has always been a thing that's just been hovering over the company. What do you do in a post-Iager era because the last one went so

poorly? It looks like they're going to look internal for candidates. The two leading ones are Joss DeMorrow, who oversees the Parks, Cruises, and Consumer Products, Division, and then there's Dana Waldron who oversees TV and film content. It's not necessarily two-horse race anymore, though. Joss Dumor, who is the park leader, is more than likely going to be the air apparent to Eiger, because, as you said, it's making more money than Scrooge McDuck. The Parks business has been the main profit center for Disney for the last decade or so. Even as they've done this big transformation into a streaming giant, people still love going to Disney World. They still love, you know, buying giant turkey legs at concession

stands. And we saw that in their last earnings, actually, even though park visitors only bumped up 1%. We saw earnings in that division jump 4%. So people are spending more money when they're, you know, doing a beer tour around Epcot. Well, they're raising prices. That's one of the main reasons that they're making more money. Disney raised prices at its parks for the fourth straight year and people are still paying up. They did highlight one challenge, which was interesting, though. International visitation headwinds. They said that fewer people were coming from internationally to parks in the United States. And I guess that has to do with sort of Trump's immigration crackdown. That's an interesting data point there. Let's talk about streaming. You said Disney's moving into

becoming a streaming first company. And that unit did absolutely gangbusters last quarter, growing 72%. That's also due to price hikes. Disney has raised prices for Disney Plus, Hulu, or both in each of the past five years. Now, what's interesting about this is that Disney Plus, the streaming service, was not profitable for many years. It was an absolute money pit. So the fact that they're making about $450 million on the streaming service is also good news that they can start squeeze out profits from what had been a profit loss making area. One thing that I thought was funny, too, just a little tidbit, is that Bob Eiger brought up Disney's acquisition, 2019 acquisition of 21st Century Fox in this last earning cycle, because they

bought 21st Century Fox for $71 billion. And he says it actually compares quite favorably to Warner Brothers Discovery being shopped around for $72 billion. So he is kind of doing like this thing where he's patting his resume a little bit saying like the company's in a great spot as I'm leaving. Like that acquisition that everyone got maybe mad at me for is doing great right now. So definitely something to watch going forward is how this. transition is handled because they've boofed it once. Let's see if they boof it again. Moving on, Christopher Nolan's summer blockbuster isn't the only thing bringing attention to the Odyssey these days. Minivans, including the Honda Odyssey, are making a surprise comeback, a resurgence

I want to talk about on today's edition of Toby's trends. Minivans sales in the U.S. nearly top 400,000 last year, rising 21% from the year prior, doing donuts around the broader auto market which saw just 2% growth. Part of the reason for the big sales of minivans is dudes. Men around 40 years old have historically favored SUVs and trucks. But that image problem is fading and men are buying, especially as Gen X and Baby Boomers reach grandparents' age. Minivans also compete well with SUVs on cost,

offering similar cargo capacity for much less money. The average new car price in the U.S. is around $51,000, but you can drive off the lot in a brand-new car. Chrysler Voyager for 40,000 or a Christopher Nolan approved Honda Odyssey for 43,000. Neil, I've always been team minivan. Three row seating, space for gear and groceries. You can stick a two by four in there or two to four kids. Glad to see they are making a comeback.

It's just such good bang for your buck. They're really the Boston market rotissory chicken meal of cars. You get a little bit of everything and you're always filled up afterward. In the 1980s and 1990s, minivan was absolutely dominant. I, my family had one in the 90s, I assume yours did do it. I was suburban, actually. You were suburban, so you just like minivans from afar. But then they grew to become less than 2% of the new vehicle market. This comeback that you're talking about has them now at 2.4% market share. It's huge, but I kid, but that's actually the highest level since 2019 when it was also at 2.4%. So there

has been resurgence for all the reasons you mentioned. Yeah, that is a good market data point to cite. This is not, you're not seeing half of the cards on the road being minivans. 2% is not much. But still, I mentioned how guys are more amenable to buying minivans these days. And part of it is because of how they've been marketing themselves. They've been showing, companies have been showing minivans with off-road tires with, you know, tents in the back, trying to push it towards more of an adventuary crowd than more of a family crowd. And that has paid off dividends.

Also, there's been some facelifts from. bigger brands. One of the coolest looking ones is the Kia Carnival, which I didn't even know Kia had a minivan that was called the Carnival. A lot of people liken that to a spaceship. It is almost a cross between the SUV and a minivan, so it's kind of a maxi van if you want. But a lot of people are saying this thing looks like something I would want to drive. It doesn't look like the Mobobile of old that people never wanted to be caught dead in. They're looking cooler and they're selling more units. And another thing driving the growth of minivans is the gig economy,

A lot of gig workers have minivans, whether they're delivering for Amazon Grubhub or DoorDash. And it's also pretty popular among Uber and Lyft drivers, especially in areas where they're doing a lot of airport runs every single time at the airport. And I call a lifter and Uber. It's always a minivan. It's very easy to fit cargo in there. So good for minivans. And the Chrysler Pacifica especially, we didn't even mention it. But that accounts for a quarter of all minivan sales.

That's the absolute giant in the room. No offense to the Odyssey. I could see Waymo and some of these other self-driving companies start to dip their toe into the minivan. Waymo has Pacificus. They are, they've been using them for robo taxis. There's future fleets could be, you know, much more minivan heavy, which, you know, again, I'm a fan. I would love to see. All right.

We're going to take a quick break and come back with a story about the movies right after this. We're the Hartford, with decades of experience insuring millions of unique small businesses. When it comes to your small business insurance. Thank you. One size absolutely does not fit all. Get a quote or find an agent today at thehartford.com slash small business. Kayak gets my flight, hotel, and rental car right, so I can tune out travel advice that's just plain wrong.

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That was the thinking that led to the thing. the creation of the indie flick Iron Lung was just grossed more than $22 million at the global box office in its opening weekend. The low-budget horror movie was entirely financed by the YouTube legend Mark Fishback,

aka Markiplier, and his army of 38 million subscribers. The film is based on a very niche horror video game where you claustrophobically navigate a submarine, dubbed the Iron Lung, through an ocean of literal blood.

To me, that sounds heinous and disgusting. To Markiplier, it sounded like a movie. So he wrote, directed, starred, and eventually plowed nearly three million dollars of his own money into bringing it to life. And damn is it living? Despite having no major studio backing it, Iron Lug debuted at number two on box office starts after its theatrical release was expanded to meet excess demand from ravenous fans. Neil, people are praising this movie for showing that with a little grit, hard work, and 38 million loyal YouTube subscribers, you too can take on the Hollywood machine and outgross the Melania documentary by $15 million. Yeah, so it costs three million

dollars to produce and this movie made over $20 million at the box office. So that is a healthy profit for a YouTuber. Meanwhile, it's not being split among more people because he sidesteps the traditional movie studio distribution process. So he's splitting it 50-50 with the cinemas. So he's bringing home like $10 million. I mean, that is a absolute payday. He absolutely grinded for. it though, through just years and years of hard work building that YouTube base to $30 million. It's a remarkable story, and it reminds you of someone named Taylor Swift, who did something very similar with her Erez tour movie, sidestepping, traditional movie studios. Now, that movie brought in $93 million, so maybe it's a different bit of scale.

And it's opening weekend. So 93 versus 20 million. Still, it is remarkable for someone to leverage their fandom like this. and he's hoping that it pays away for more YouTubers or other content creators on the internet to do the same thing at the traditional box office. This movie is nuts, by the way. It is very true to the video game, which fans love. But unfortunately, the camera never leaves the Iron Lung mini-sub.

So it's a very claustrophobic. It's a one-shot movie, essentially. And the other question is, is it a good movie? And that is up for debate? because a lot of people says it's clear that Markiplier is a first-time movie maker. He probably let the edit get a little too bloated. It runs over two hours. Again, his fans love it because there's little Easter eggs for his fandom.

There's Easter eggs to the game itself. So in terms of the market it was created for, it did very well. If you just were to see this as someone who had no idea about the video game or about Marketplier, maybe it's not the best movie. Yeah, Indie Wires review, I thought was fascinating. He said that they said that the director seems to mistake fan loyalty for limitless attention. The result is not self-important so much as punishingly sincere, punishingly sincere, a movie that believes so deeply in its process that it neglects cinematic momentum.

Still, they said this was a very worthwhile project and they really appreciated his efforts here. It's also, I think, big picture, looking back, we've talked about Gen Z, Millennials, Internet, being the death of cinema. But maybe it's, maybe people want something different. the people who went to the movie called it a communal live streaming moment. There was chatter throughout. People were talking and it didn't really matter, probably similar to what happened during the ERIS tour movie, because this is just a place for people to get together and experience something communally on the live screen that they've experienced on their phones or their

laptops for so long. So a very cool situation. He was sobbing on this live stream on Sunday night talking about this. I'm not going to see it. Ocean of Blood. I can't get over that part. Sorry, Markiplier. All right. Let's bring to the finish with some final headlines. in India have struck a trade deal, according to President Trump and India's Narendra Modi, softening tensions between the two longtime allies. Trump said that tariffs on Indian goods coming to the U.S. will fall to 18% from 50% currently in exchange for India halting its purchases of Russian oil, which angered Trump. That 50% tariff on many Indian goods was the highest rate for any major trading partner. Prime Minister Modi said he was, quote, delighted about the lower tariff rate,

but did not mention Russian oil in his statement. India's stock market and the rupee both popped on the news. Yeah, this always felt like a trade deal that was bound to happen because India sends nearly 20% of its total exports to the US. It's a big partner in that region of the world. It makes India a lot more attractive to now as a alternative manufacturing place to China. Capital economics estimates that its GDP growth after this deal could get a major bump, 0.2 to 0.3 percentage of proof. India is supposedly like the growth engine in that region, not named China.

So this once again kind of brings the US and India a little bit closer together after this deal was struck. Moving on, Trump is creating a piggy bank for rare minerals and pledging $12 billion to fill it. Yesterday the White House announced the creation of Project Vault,

an initiative that is meant to stockpile critical materials like gallium and cobalt that go in everything from phones to drones. The idea is to use. store some special rocks under the mattress to avoid reliance on China, who is far and away the dominant provider and processor of critical minerals. The project is a public-private hybrid with the likes of GM, Boeing, Google, and others promising to contribute and buy from the stockpile. You know, this move is definitely tied back to last year to when China squeeze global supply chains

by tightening export controls. That served as a wake-up call for the U.S. and its allies, leading to the rainy day rock pile that is Project Vault. It even goes further back than that to the 1970s when the United States created the strategic petroleum reserve. That's when there was this Arab oil embargo. There was a shortage of gas everywhere. We weren't alive, but the lines at the gas pump were extremely long. So the United States created this strategic petroleum reserve. This rare earth one is modeled after that.

And it's a good opportunity to just zoom out and talk about all the fun strategic reserves there are all across the world because for the past few decades, countries have been stockpiling goods in case of emergencies, and the goods are not the same across each country. For example, Canada has a strategic butter reserve that can weigh as much as 39 million pounds because you need to have your butter. And then also, this is probably the most famous example, Canada does have a strategic reserve of maple syrup capable of holding almost 100 million pounds of maple syrup. there is an apocalypse, we will, our pancakes will be well. Sierra. China has a strategic pork reserve.

Malaysia has one for frozen fish. And Vietnam, this one was just started at the beginning of the COVID-19 pandemic. Stockpiled 270,000 metric tons of rice. You missed my favorite one, though, which is the kimchi storehouse that South Korea has because in case, you know, you run out of kimchi. I love how you can just put strategic in front of everything. And it just takes on grander importance. Like, I have a strategic lucky charm. reserve up in my counter space right now. So strategic food reserves are just always fun to talk about. Finally, Lunar New Year is coming up in China and everyone's scrambling to buy a toy with a glaring manufacturing error, dubbed the crying horse on social media where it's absolutely blowing up. The toy is a plushy horse that was originally supposed to have a smiley face. But after a 180-degree sewing mix-up, that smile was turned into a frown. Sellers are moving 15,000 units a day as they struggle

to meet to man, even after adding a dozen production lines for both the frowny and smiley versions of the horse. Toby, yes, it's extremely goofy, but there's also something much deeper behind this craze. Yeah, it's a perfect symbol for how a lot of, you know, Chinese people are feeling right now where 2026 is the Chinese zodiac sign. It is the firehorse. It's supposed to be all about ambition, growth, passion, etc. But a lot of people are feeling it burnt out with wage stagnation amid this 996 work culture that, is just making people work too hard and just not feel like they're having a good participation in the economy in a lot of regard. So what is the best way to show that? It is literally a horse

that is supposed to embody the year with a frown on its face. So we'll see how long this actual craze last because if we know one thing about collectors in China, they can often boost things up to gigantic hikes. I'm thinking of Laboubu before those prices come crashing it down. So we'll see how long the frowny horse kind of remains in the zeit guys. Yeah, but I love it because you can do the pair. You can do the smiley and then you can do the frowny. But also, yes, you're right. This is a place.

This is a country that also had the number one app be, Are You Dead? Where you had to check in every single day to, or every couple of days to make sure you're not dead. But yeah, I need to get my hands on this frowning horse. It looks so funny. That is all the time we have. Thanks so much for starting your morning with us and have a wonderful Tuesday, which how the heck is it only Tuesday?

This is the longest week ever. If you want to get in touch, send an email to Morning Brew Daily at Morningbrew.com or DMS on Instagram at Ambid Daily Show. Let's roll the credits. Emily Milliron is our executive producer. Raymond Lute is our producer. Our associate producers are Olivia Graham and Olivia Lake. Hair is merging with makeup. Devin Emery is our president and our show is a production of Morning Brew.

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