The Rundown - Disney Magic is Back, Arm Shares Jump 50%

Starting point is 00:00:00 Welcome to the rundown, your daily market update in under five minutes. My name is Zadadmani, and today is Thursday, February 8th. In today's episode, we dive into Disney's earnings. They made a lot of announcements yesterday, and investors are feeling the magic. We also discuss some AI announcements from Google. They're killing Bard, and replacing it with something better? I also list out some winners and losers in the stock market today, like there's a semiconductor company that is up more than 50% just today.

Starting point is 00:00:27 And you might have heard of this company before. Oh, and then I end the show with a fun fact about Ozympic, which made me laugh and feel kind of weird at the same time. All right, let's get into it. Let's do a quick recap of stocks on Wednesday. Stocks were higher across the board. The Dow, S&P, and NASDAQ were all on the green, with the S&P closing at 4,995 points. Five points shy of 5,000. But hey, it was still a record close for the S&P 500, so I'll take that.

Starting point is 00:00:53 In fact, yesterday was the eighth record closed for the year. The watch for 5,000 continues today. It's not quite there yet at the time of this recording around noon Eastern. The S&P and Dow are both trading down right now, but the NASDAQ is currently in the green. All right, let's run through some headlines. Starting with Disney's earnings. Guys, the magic might be back. Disney reported Q4 earnings on Wednesday after the market closed, and investors seem to be loving it.

Starting point is 00:01:16 The stock is up more than 10% at the time of this recording around noon Eastern. So let's dive into the numbers. Disney did $23.55 billion in revenue, which is actually pretty flat compared to the previous year and slightly lower than expected. but their earnings of $1.22 a share came in higher than expected. So Disney's revenue is flat, but their profits are up. And that's thanks in large part to some of the cost cutting that Disney has been doing over the past year. And Disney is not stopping with the cost cutting. They plan to cut at least $7.5 billion in costs this year as well.

Starting point is 00:01:42 More profits always get investors excited, but I think this announcement is what really got everybody hyped. Disney is investing $1.5 billion into Epic games, which is the maker of Fortnite. Disney said they're going to work with Epic to develop games using Disney's IP, which is such a no-brainer, I'm actually kind of surprised that Disney didn't embrace gaming sooner. Like, we should have some great Disney games right now. And hopefully we get that now. I also wonder if this means that we're going to get Disney characters on Fortnite because that would be dope.

Starting point is 00:02:09 Like, imagine having Darth Vader on Fortnite or maybe even like Elsa. I don't want to try that for sure. Looking at other parts of Disney's business, it was kind of a mixed bag. Disney Plus lost 1.3 million subscribers. Not great, but they still have over 149 million subscribers. And Disney was able to shrink their streaming losses down to 216 million. compared that to over a billion plus that they lost a year ago. And they expect streaming to be profitable by the end of this year.

Starting point is 00:02:34 So it's easy to see why investors are starting to get pretty hyped. Oh, I almost forgot to mention that Disney is going to be increasing their dividend by 50% to 45 cents a share. And they also authorize a $3 billion stock buyback. So things might finally be turning around at Disney. And that's why Disney stock is up more than 10% at the time of this recording. Let's shift gears and talk about AI because Google made some announcements today. They're killing Bard. Well, they're technically renaming Bard.

Starting point is 00:02:58 to Gemini. I know that names are a very subjective thing, but like, let's be honest here. Gemini is a way better name than Bard. Bard wasn't a great name. So they're going with Gemini moving forward. Along with the rebrand, Google is launching a Gemini Android app, and iOS users can access Gemini using the Google app.

Starting point is 00:03:14 And the last major announcement is that Google is launching a subscription service. For 20 bucks a month, users will have access to Google's most powerful AI model called Gemini Ultra. I'm kind of ashamed to admit this, but I'm addicted to signing up for AI tools. I sign up for pretty much all of them for at least a month. I can't wait to try it out. So it's clear that after Google kind of got

Starting point is 00:03:31 ridiculed for not responding to chat GPT, that they're coming out and making moves regarding AI. The AI wars are just getting started. All right, let's talk about some stocks making moves today. I tease it in the intro, but there is a semiconductor company, which stock is up more than 50%. I'm talking about Arm. It's a big winner today. Arm reported better than expected earnings, and investors are hyped about the AI potential for this company. Yeah, I mean, what else is new, right? Arm did $828 million in revenue, which is up $14,000. percent higher than expected. And they also did $87 million in profit. See, Arm is a chip designer. They design chips and they license their design to smartphone makers. You know, companies like Apple,

Starting point is 00:04:07 Samsung, and pretty much every smartphone maker in the world. But Arm also designs chips for AI application, which is seeing a huge boom right now. And that's why investors are hyped. The stock is up more than 50% at the time of this recording around noon Eastern. You know, I really need to start an AI company because, I mean, just, it's crazy right now. A company not doing so hot today is Mursk. Mursk is a Danish company and it's one of the biggest shipping companies in the world. Stock is down more than 13% at the time of this recording around noon Eastern after they say they expect their profits in 2024 to drop by up to 90%. So why are they expecting that? Well, it's because shipping rates have been dropping since the pandemic. Shipping rates were at record highs

Starting point is 00:04:43 during the pandemic and a lot of shipping companies ordered a ton of cargo ships. And now we have an oversupply of cargo ships, which is causing shipping rates to go down. And that is hurting Mersk is bottom line. Also, there's the uncertainty around the Red Sea attacks, and Mersk is unsure how long the conflict will last, but the company did say that the Red Sea only impacts about a third of their business. The bigger issue seems to be too much supply of cargo ships, and the slowdown in global trade. I mean, if you're an investor and you hear profits dropped by 90%, that's not going to be a fun day. All right, let's wrap up the show with a fun fact. Today's fun fact is that OZempic is scaring CEOs of food companies. The maker of OZempic,

Starting point is 00:05:17 Nova Nordus reported earnings last week, and the CEOs said something pretty interesting. He said that food companies are calling him because they are scared of the impact that OZempe, along with other weight loss drugs, will have on their business. See, these new weight loss drugs make people less hungry. And if millions of people start taking these weight loss drugs, people are going to buy less food then. So snacks CEOs worried that the population might get healthy and not want unhealthy, sugary, and salty snacks anymore. Just really don't know how to feel about all that. All right, guys. It's all got for you guys today.

Starting point is 00:05:46 Thank you guys so much for listening. And we'll see you guys back here tomorrow. This is Public Live, your real-time resource for news events and trends in the markets. All views presented in this show reflect the opinions of the guests. You should not take any mention of a publicly traded security as recommendation to buy, sell, or hold that security. Public Live hosts are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult. Respective professionals.

Starting point is 00:06:18 Learn more at public.com slash disclosures. In paid partnership with Zaid Admani, brokerage services for U.S. listed, registered securities are offered by Open to the Public Investing Incorporated, member FINRA and SIPC.

The Rundown - Disney Magic is Back, Arm Shares Jump 50%

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