Business

Disney’s experiences division, which includes its theme parks, is the best-performing part of Disney’s business as the company tries to adapt to changes in movie and TV viewing habits.
Josh D’Amaro, who leads the division, is overseeing additions and changes to the parks as Disney pledges $60 billion in investments in the segment over the next decade.
From innovations in robotics and animatronics to more immersive storytelling, Disney is looking for new ways to keep people coming to its parks.

Visitors wearing emblematic Mickey Mouse and Minnie Mouse ears walk in front of the Sleeping Beauty-inspired castle at Disneyland Paris, Oct. 16, 2023.
Ian Langsdon | Afp | Getty Images

Three years ago, Josh D’Amaro stood in a nearly empty Disneyland.
The California theme park’s Main Street was quiet: no cheery tunes from famed barbershop quartet the Dapper Dans, no clanging railroad bell, and no wafting scent of waffle cones from the Gibson Girl Ice Cream Parlor.

It had been more than a year since the Covid pandemic had forced Disney’s domestic parks to shutter, but D’Amaro, chair of Disney’s experiences division, was confident guests would flood back in when the gates reopened.
His confidence was well founded. D’Amaro’s division is now Disney’s best-performing segment, rebounding and offering stability in recent quarters as Disney shuffles to adapt its entertainment business to match consumer habits that changed after the pandemic.
On that quiet day in 2021, D’Amaro had been in charge of the parks, experiences and consumer products division, now just called experiences, for only a little more than a year. He took the helm when Bob Chapek was tapped as CEO in early 2020. D’Amaro spent much of those 12 months dealing with substantial operating losses from global park closures, a docked fleet of cruise ships and a plunge in hotel visits.
Revenues fell 35% in 2020, a nearly $10 billion decrease from the $26.2 billion the experiences division had tallied in the year before the pandemic. Then revenue dropped an additional 3% in 2021.
But a lot has changed in three years. D’Amaro — sitting in a conference room in Burbank, an hour north of Disneyland and just a few miles from the heart of Disney’s theme park creative engine, Walt Disney Imagineering — has much to brag about.

The experiences division posted record revenue of $32.5 billion in fiscal 2023, a 16% increase from the prior year. Operating income jumped 23% to $8.95 billion.
D’Amaro described the pandemic as “an opportunity to take a breath” and a time for his division to “think about what we wanted the future to look like.”
“So, as difficult as that situation was, we saw it as a platform, a new vantage point for us to look at the operation,” he said.
While its parks were shuttered, Disney continued construction of its Avengers Campus themed land in Disneyland and touched up old favorites such as the King Arthur Carousel. And it built new rides, and refurbished others, in the years that followed.

Avengers Campus at Disneyland in California.
Christian Thompson/Disneyland Resort

World of Frozen opened in Hong Kong Disneyland in November, and a Zootopia land opened in Shanghai Disneyland in December. The company also launched two new rides at Walt Disney World in Florida: a “Guardians of the Galaxy”-themed ride in its Epcot park in 2022, and a “Tron”-themed roller coaster in the Magic Kingdom in April 2023.
Additionally, the company has revamped attractions and themed park areas, turning the Pacific Wharf area of Disneyland’s California Adventure into San Fransokyo Square, based on the animated hit “Big Hero 6,” updating Mickey’s Toon Town at Disneyland and making major transformations at Epcot.
Those investments, coupled with new technology in mobile ordering and the ability for guests to pay to skip to the front of the line for certain rides, have kept guests coming and boosted Disney’s earnings at a time when the entertainment division is struggling to recapture its late-2010s boom.
“Sitting here now, today, you’ve seen our results; our results have been record-setting as recently as the last first-quarter earnings,” D’Amaro said. “Record revenue, record margins, record operating income. So, the recovery has been swift, it’s been strong. But more importantly, I think the future looks incredibly bright for our segment — and the company, quite frankly.”
In 2023, experiences was the best-performing part of Disney’s business, accounting for 36% of the company’s total revenue but 70% of its operating income. Meanwhile, Disney’s entertainment division, which includes its theatrical and streaming businesses, represented 45% of revenue but just 11% of operating income.
The ability to get more out of the parks in recent years was crucial for CEO Bob Iger and Disney’s board as they tried to make the company more profitable and improve share performance. On Wednesday, Disney beat back activist investor Nelson Peltz’s proxy fight, reelecting its full board.

Always innovating

The division’s strength is why Disney has pledged to invest $60 billion in experiences over the next 10 years — a key part of its strategy to keep the parks fresh and relevant in a competitive segment.
D’Amaro said about 70% of that money will go toward “new experiences” in domestic and international parks, along with cruise lines. The other 30% will go toward technology and infrastructure, including maintenance of existing attractions.
Innovation at theme parks has been a central goal since Walt Disney ran the company. Disney’s founder used to say that its theme parks would “never be finished” and would evolve to meet consumer demand and changing tastes, along with developments in technology.
Walt Disney Imagineering has long been on the cutting edge of development. Its innovations, from ride mechanics and animatronics to creature design and immersive architecture, have made Disney’s parks a standout in the industry.
Last year, guests caught a glimpse of one of these innovations — a trio of tottering bipedal robots from Star Wars called BDX droids. First spotted at California Disneyland’s Star Wars: Galaxy’s Edge, they are just one iteration of a new technology Disney Imagineering is developing to bring walking robotic characters to life.

Walt Disney Imagineering’s two-legged walking character platform in the form of BDX, a Star Wars droid.

Engineers create the mechanics for the remote-controlled droids to move and balance, and work with animators to give those movements personality. The robots were designed to have childlike curiosity, reflected through cheeky head tilts and chirping beeps, along with a special emote dubbed “tantrum,” where their eyes glow red and they emit a high-pitched squeal.
Guests who visit Galaxy’s Edge in the next three months may stumble across this trio as part of Disney’s “Season of the Force.” They add to the regular roaming character meet-and-greets with the likes of Rey, Chewbacca, Kylo Ren and stormtroopers.
Disney hopes hands-on innovations such as the robots will keep guests coming.
“Those moments where there’s a spark, there’s an emotion that’s on full display, where a guest is interacting with an attraction or a cast member or a character, it’s very real and genuine,” said D’Amaro.
That emotion was on display at the South by Southwest conference in March 2023, when Disney debuted a new iteration of its “stuntronics” robot, this time in the form of Judy Hopps from “Zootopia.” This technology had previously been used to create the Spider-Man leap stunt at Avengers Campus. During the 2023 presentation, Imagineers showed the audience how the Judy Hopps robot could balance on roller blades and perform somersaults.
The biggest audience reaction came at the end of the presentation, when an Imagineer lifted the bot to sit on his shoulders and it realistically moved its legs to fit around his neck, as a child would. The simple motion — programmed just for the presentation, Imagineers told CNBC — captured something intrinsic to the human experience.
D’Amaro said those moments show why it’s important for Disney animators to be part of the development process: As the Imagineers craft new technologies, the artists can help bring them to life.
It shows in Disney’s rebrand of Splash Mountain. In both the California and Florida parks, the company is refurbishing the ride into Tiana’s Bayou Adventure, which will feature dozens of animatronic characters from “The Princess and the Frog.”

A preview of Walt Disney Imagineering’s audio-animatronics for the upcoming refresh of Splash Mountain, Tiana’s Bayou Adventure.

Imagineers have developed all-electronic audio-animatronics for the ride for characters such as Lewis, the trumpet-playing alligator from the film. Disney revolutionized animatronics decades ago with its hydraulic, or liquid-fueled, and pneumatic, or air-fueled, systems, but the electronic animatronics for Tiana’s Bayou allow for more refined and precise movement, making them appear more realistic. Similar animatronics can be seen in the rides Smuggler’s Run and Rise of the Resistance, in Galaxy’s Edge.
Interior pieces of some of the animatronics were crafted using 3-D printing, resulting in a lighter-weight material.

Telling stories in the parks

Disney’s ambitions to grow its experiences unit hinge in part on making its attractions feel more real.
“They continue to push the envelope of storytelling and creativity,” D’Amaro said of the Imagineering team.
He cited the recently shuttered Star Wars Galactic Starcruiser, a hotel and immersive experience that took guests on a two-day “voyage” in space. It was a 48-hour interactive story that allowed fans to physically play in the Star Wars universe.

Guests arrive aboard the Chandrila Star Line’s Halcyon at Star Wars Galactic Starcruiser.

“This is something that had never been done before,” D’Amaro said. “It was difficult to even explain to the public, and I think it was incredibly brave for us to move into this space. … And this, to me, says Imagineering is still at its best today.”
High ticket prices deterred the average parkgoer, and the Galactic Starcruiser shuttered in September. Still, D’Amaro said the experiment was a learning opportunity for the company.
“Those learnings are being employed on the next experiences, which we haven’t even announced yet,” he said.
Storytelling is at the heart of everything across Disney’s experiences division.
This extends to Disney’s cruise line and hotels, as well as its video game business. The company has a fleet of five cruise ships, and plans to add three more by fiscal 2026.
The Disney Wish, which made its maiden voyage in 2022, was the first addition to the fleet in a decade and bet big on its powerhouse franchises to entice travelers to the high seas.
There’s a “Frozen” sing-along dinner and a Marvel dining experience, as well as a Star Wars-inspired Hyperspace Lounge. The ship also has the first ever Disney water ride attraction on board, the AquaMouse.

Disney’s “Frozen”-themed dinner show on the cruise ship Wish.
Disney | Matt Stroshane

“This is something I think that’s really important, the idea of the Disney difference,” D’Amaro said. “That this company works together as one is more powerful now than I think it ever has been — whether it’s [entertainment co-chair] Alan Bergman in the studios creating a new property that we can then take to Disney experiences and bring it to life and extend that story in brand new ways, or franchises that are birthed out of the theme parks.”

Disney’s ‘blue sky’

Disney’s experiences division has immediate expansion plans — even before the bulk of the planned $60 billion investment kicks in.
Next to open for Disney is Fantasy Springs, an eighth port at the Tokyo DisneySea park. The land will be home to three new areas — inspired by the films “Frozen,” “Tangled” and “Peter Pan” — as well as the new Tokyo DisneySea Fantasy Springs Hotel.
Concept and design work is also underway for the Tropical Americas area at Disney’s Animal Kingdom in Florida. There have been no official updates on the previously announced third ride at Avengers Campus in the California Adventure area at Disneyland.
The company is developing what it’s dubbed “blue sky” ideas for its parks — projects that are still in early development and may ultimately not see the light of day.
Disney has teased that an area based on “Coco” or “Encanto” or both could be underway in the Magic Kingdom. There were also talks about opening an area of the Magic Kingdom that would be overrun by Disney villains.
During the company’s investor meeting this week, Iger even teased the possibility of an “Avatar” land at Disneyland in California.
“We have thousands of acres of land still to develop,” Iger said during the Morgan Stanley Conference in March. “We could actually build seven new full lands if we wanted to around the world, including the ability to increase the size of Disneyland in California, which everybody thinks is kind of landlocked, by 50%.”
Price points for these projects will vary, if they do come to fruition. The recent additions of the two Star Wars: Galaxy’s Edge lands in Disneyland and Disney World are estimated to have cost $1 billion each.
That’s where the $60 billion investment comes in.
Disney likely won’t spend it all soon.
“We actually have a fairly good idea in the near term of what’s being built, but we’re purposefully not going to allocate it all,” Iger said at a media event Tuesday, according to the Los Angeles Times. “Because who knows? In five years we can end up with a giant hit movie — think ‘Frozen’ — that we may want to mine essentially as an attraction, or a hotel or restaurant in our parks. So you want to maintain some flexibility.”
But Iger won’t be head of the company in five years, if all goes according to plan. The CEO, who returned to the post in 2022, is set to step down at the end of 2026. Disney’s board is in the process of succession planning.
D’Amaro is on the short list.
His track record helming Disney experiences is part of a 26-year career with the Walt Disney Company, in which D’Amaro has held posts as chief financial officer for consumer products and global licensing and chief commercial officer for Walt Disney World Resort.
For now, however, D’Amaro said he is concentrating on his current post. He called it a “blessing” to have Iger back as CEO.
“I’m focused on Disney experiences,” he said when asked about potential succession plans. “And I’m focused on driving innovation and storytelling forward and paying tribute to our fans and continuing to grow this business.” More

IN RECENT MONTHS Tesla has had a bumpy ride. In January the electric-vehicle (EV) pioneer warned that growth would be “notably lower” this year, as motorists’ enthusiasm for battery power loses charge. The same month it had to suspend most production at its giant factory near Berlin because of supply disruptions caused by turmoil in the Red Sea. Its market share in China, the world’s biggest EV market, is falling as it fends off cheaper local competition, especially from BYD, which late last year briefly eclipsed Tesla as the world’s biggest EV-maker.Tesla hit another big pothole on April 2nd, when it reported that it had delivered fewer than 390,000 cars in the first quarter. That was down by 8.5% from a year ago—and considerably worse than already cautious Wall Street analysts were expecting. Tesla’s market value has slumped by a third this year, to less than $550bn. That is still more than any other carmaker but a far cry from the $1.2trn it was worth in 2021. Its boss, Elon Musk, is now only the world’s third-richest man.If you think the billionaire and his firm are having a rough time, spare a thought for their once-white-hot imitators. Three years ago, as Mr Musk showed that EV-making could be a trillion-dollar business, investors scrambled to back the newcomers promising to be the next Tesla. Two American startups that had gone public earlier that year were accelerating as briskly as their cars. The market capitalisation of Lucid Motors, founded in 2007, exceeded $90bn; that of Rivian, created two years later, hit around $150bn. Each was worth more than Ford, which was nearly 120 years old and sold 4m vehicles in 2021, compared with 125 for Lucid and 920 for Rivian. Chinese rivals such as Li Auto (founded in 2015), Nio and Xpeng (both in 2014) were also valued richly. In late 2021 the combined market value of six prominent Tesla wannabes hit a stonking $400bn.Chart: The EconomistToday the six are worth $65bn, and falling (see chart). Fisker, an eight-year-old American firm, and HiPhi, a five-year-old Chinese one, have paused production. On March 25th a crumbling share price caused the trading of Fisker’s shares to be suspended and the firm may soon be delisted. HiPhi may be looking to sell itself to a big established Chinese carmaker. Faraday Future, which sold barely 11 of its upmarket EVs last year, is teetering on the brink of bankruptcy. Lordstown, an American startup founded in 2018 to make electric pickups and SUVs, went bust in 2023. Even somewhat sturdier firms are struggling. VinFast, a Vietnamese firm which was set up in 2017 and went public last year, briefly—and bafflingly—almost touched $190bn in market value last August. It sold 35,000 EVs in 2023 and is now worth $11bn. Rivian sold 50,000 and is worth a fifteenth of its peak in 2021. Lucid sold 6,000 and is also worth one-fifteenth. Li Auto, Leapmotor, Nio and Xpeng, which delivered over 800,000 cars between them last year, have also seen their share prices shrivel. Only Li turns a profit, mostly because it manufactures nothing but hybrid vehicles; its market value plunged recently after it revealed its first pure EV. Surviving—let alone thriving—in what was meant to be a brave new electric world is proving tough. Which Tesla wannabes, if any, will make it?It was all meant to be different. Making money from internal combustion engines, whose thousands of moving parts drove up complexity and costs, required carmakers to churn out large volumes. In contrast, the new economics of battery power was supposed to bring down barriers to entry. The electric upstarts, apeing Tesla by styling themselves as tech firms rather than manufacturers, reckoned they could keep costs in check by using simpler designs and reimagining the production process in a way stodgy incumbents could not. Components such as batteries and electric motors can be bought off the shelf, leaving the EV-makers to focus on developing whizzy software that would allow their vehicles to stand out thanks to a better in-car experience, from infotainment to mood lighting. Some companies, like Fisker, simply outsourced the metal-bending.These advantages have, however, failed to outweigh the old-school need for critical mass. Turning a profit from cars still requires producing perhaps 500,000 vehicles a year. “Scale is vital and manufacturing is hard,” sums up Tu Le of Sino Auto Insights, a consultancy. Though Tesla began as a luxury marque, putting big and pricey batteries in big and pricey cars, it always eyed the mass market. Profits started streaming in only once it overcame the near-death experience— “production hell”, in Mr Musk’s words—of trying to churn out high numbers of its cheaper Model 3.The Tesla wannabes, for their part, have taken too long to start production and are now taking too long to launch new models, says Pedro Pacheco of Gartner, a consultancy. The chances of survival by serving only a high-margin high-price niche are low, notes Philippe Houchois of Jefferies, an investment bank. Just look at the possibly futureless Faraday Future, whose models start at $250,000.The electric insurgents are waking up to the reality. Their first step is to look downmarket. On March 7th Rivian announced three less expensive models that will start arriving in 2026. Last year Xpeng signed a deal with Didi Global, a Chinese ride-hailing giant, to make cheaper cars and forged a partnership with Volkswagen to make mass-market EVs for China. Nio plans to launch two affordable sub-brands, Alps and Firefly. Even Lucid, whose cars go for as much as $250,000, plans to launch somewhat less exclusive $50,000 models within a few years. In October Leapmotor sold a 20% stake to Stellantis, a mass-market behemoth whose marques include Citroën, Chrysler, Fiat and Peugeot (and whose largest shareholder part-owns The Economist’s parent company), for $1.6bn. The pair will team up to make EVs.To succeed, these efforts must still produce a competitive product with unique features. Tesla pulled it off by putting technology first. The result was a desirable EV that wasn’t cheap but offered a svelte look and decent range; the legacy industry’s earlier attempts, such as the Nissan Leaf, were expensive but also ugly and short of juice. Despite a strong tech focus like Tesla, most startups have failed to deliver unique products at competitive cost, as they continue to lack scale, says Patrick Hummel of UBS, a bank. Now the novelty of clever EV technology “has worn off”, adds Becrom Basu of LEK, another consultancy. Good range and other once-cutting-edge tech is considered table stakes, including for incumbent carmakers with considerably beefier manufacturing chops.As a result, many of the EV entrants lack unique selling features. The cars made by Rivian and Lucid are technologically unremarkable. Their good looks alone do not justify the hefty price tag. Rivian’s cheapest electric pickup costs around $70,000, half as much again as Ford’s F-150 Lightning without offering one-and-a-half as much car. In Europe the Lucid Air, a luxury saloon, is significantly pricier than comparable electric BMWs or Mercedes. Fisker’s mass-market EVs are also well designed but still cost more than Chinese rivals with similar features, partly because its asset-light outsourcing strategy does not work well for cheaper cars. Why anyone would buy a VinFast remains a mystery; reviews of its VF8 SUV were damning, to put it charitably.With demand for their products tepid many of the companies need more capital to keep going. On March 25th Lucid said it had managed to wangle another $1bn from its biggest investor, Saudi Arabia’s sovereign-wealth fund. Many rivals are not so lucky. Rivian had $9.4bn in net cash at the end of 2023 but will need billions more to build its cheaper models. Gone are the days when moneymen would throw treasure at any firm with a plausible PowerPoint presentation and an artist’s impression of a sleek electric car. Having put up billions of dollars in the years leading up to 2021, only to see billions torched, they look askance at missed deadlines, disappointing new models and ever receding prospects of profits. Their second thoughts have not been dispelled by the recent slowdown in growth of EV sales in many countries. Incumbent carmakers have no interest in rescuing the insurgents. Mr Hummel of UBS thinks that most of the startups will simply disappear.The likeliest to survive are the Chinese. One reason is that they appear to be the most innovative of the bunch. Nio’s upmarket EVs come with the option of battery swapping and, in China at least, a vast network of stations to do it. Drivers can be on their way in minutes without getting out of the car. Bernstein, a broker, considers Xpeng one of the leaders in autonomous-driving technology.They are also a relative bargain compared with their Western rivals. Both Nio and Xpeng, as well as Li Auto, have benefited from an impressive battery supply chain, dominated by Chinese firms like CATL, and steadfast support from central and local governments, notes Mr Le. That in turn has allowed the Chinese companies to keep both their costs and their prices down. The result has been rapid uptake of EVs in their giant domestic market, and with it greater economies of scale.And another wave of carmaking disruption may be swelling in China, courtesy of Chinese big tech. In 2021 Seres, an established Chinese car company, and Huawei, the closest thing China has to a national tech champion, jointly launched AITO, a new brand dripping with fancy tech. In January the venture delivered 33,000 cars. On March 28th Xiaomi, which has hitherto made mostly smartphones, launched its first SUV. The car, made by BAIC, a state-owned car giant, and costing as little as $30,000, attracted 90,000 orders in 24 hours.Xiaomi aims to take on, at least in China, both Tesla and BYD. Alibaba, China’s e-commerce behemoth, and SAIC, another big state-owned carmaker, have been producing cars together for two years and sold 38,000 last year. Foxconn, a Taiwanese contract manufacturer better known for assembling iPhones for Apple, many of them in China, aspires to build half the world’s EVs for its own brand or others. If Tesla and any other survivors of the current EV shake-out thought they could catch a breath, they should think again. ■ More

THE MOON will not start to move between Earth and the sun until the morning of April 8th. But the business impact of this month’s total solar eclipse, which starts over the Pacific Ocean, cuts a path across North America and ends in the Atlantic, is already plain to see. According to Jamie Lane of AirDNA, a travel-data firm, on a typical Sunday night in April around 30% of homes listed for short-term rental on Airbnb or Vrbo in areas in or around the eclipse’s path are occupied. A remarkable 92% of listings within the zone of totality have been booked for April 7th. Demand for homes just a few towns outside this roughly 180km-wide strip has barely changed.The eclipse will be visible from a handful of big or biggish cities, including Dallas, Indianapolis, Cleveland, Buffalo and Montreal. CoStar, a hotel-data provider, reckons that occupancy rates in those places are up anywhere from 12 percentage points (in Montreal) to 67 (in Indianapolis). The remaining rooms appear to be available only at elevated prices. The New York Times reports that nearly half of Super 8 motels in the eclipse’s path with rooms still available are charging at least twice the standard rate.Yet this path mostly covers areas with relatively scant lodging inventory. Of the 92,000 American short-term listings in this zone—just over 5% of the 1.6m in the United States as a whole—85,000 have been reserved for April 7th, compared with just 20,000 for the following Sunday. In theory, owners of short-term rental homes should have been able to jack up prices just like hoteliers, particularly in places with few hotel rooms.However, few Airbnb hosts run their properties with a hotel manager’s business acumen. AirDNA’s numbers show that in cities like Dallas and Niagara Falls, the majority of reservations for April 6th, 7th and 8th were made more than two months ago—far earlier than is typical. Savvy guests pounced on the standard prices on offer before hosts realised that they could raise them and still secure bookings. The average booking on April 7th went for $269, only slightly above the $245 level for April 14th. Combining the 65,000 additional bookings with a 10% increase in the nightly rate suggests that Airbnb and Vrbo hosts will receive a total revenue bump of merely $18m. Even counting the days before and after the peak of demand, when occupancy rates also exceed 80%, only brings the cumulative additional turnover to a total of $44m.The American hosts—and the digital platforms that live off commissions on such rentals—missed a trick, in other words. Unfortunately for both groups, they will not have another chance to learn from their mistake for a while. Alaskans have to wait until 2033 until the next total eclipse, North Dakotans and Montanans until 2044, and Floridians, tourist-friendlier providers of accommodation, until 2045. ■ More

Gatorade has been branching out into new categories, including unflavored water, to keep up with consumers’ changing tastes and tougher competition.
Rivals like Prime Energy and Coca-Cola’s Bodyarmor have put pressure on Gatorade’s market share.
Year to date, Gatorade is gaining share in every hydration category it has products, according to market research firm Circana.

A smattering of products housed under the Gatorade brand
Source: Gatorade

As Gatorade approaches its 60th birthday, the brand is staying spry, branching out into new categories from unflavored water to energy drink mixes.
Since its founding in 1965, Gatorade has been the dominant sports drink. It accounted for 63.5% of the U.S. sports drink market in 2023, according to Euromonitor International data.

Owner PepsiCo’s archrival Coca-Cola takes the second and third slots with Powerade, a perennial No. 2 choice to Gatorade, and Bodyarmor, a newer addition to its portfolio. But combined, Coke’s two brands account for only about a quarter of the U.S. sports drink market. Last year, Pepsi reorganized its portfolio to house Propel, Muscle Milk and other fitness-related brands under the Gatorade name.
But Gatorade’s dominance doesn’t mean that it can rest on its laurels. As more competitors enter the market, the brand has tried to reinvent itself.
“There’s probably been more change in the industry in the last five years than there was 20 years before,” said Rabobank beverage analyst Jim Watson.
Pepsi’s rivals are looking to steal its market share as they branch into new products. Unilever bought drink mix company Liquid I.V. in 2020 for an undisclosed amount; Gatorade’s individually packaged hydration powders resemble the upstart’s. Nestle Health Science bought hydration tablet maker Nuun in 2021, the same year that Coke bought Bodyarmor.
With Coke’s acquisition of Bodyarmor, it bought a brand that could price its sports drinks higher, thanks to its marketing as a healthier option. Coke’s other sports drink, Powerade, is typically cheaper than Gatorade, appealing to consumers looking for a deal.

“That means they have a different and better story to tell the retailers to try to get more shelf space and to take some of that from Gatorade,” Watson said. “That’s where Gatorade has to come up with all kinds of new innovations so they have a new story to tell the retailers so they keep all of their shelf space.”
Even smaller brands without the firepower of Coke or Unilever have been putting pressure on Gatorade.  PepsiCo CEO Ramon Laguarta called out influencer Logan Paul’s Prime Energy as one brand stealing share from Gatorade.
“It is true that the emergence of Prime in the category took some share from Gatorade, [though] less than other brands in the category or less proportionally to the size of the brand,” he said on the company’s third-quarter conference call in October, adding that Prime’s market share weakened as summer turned to autumn.
Gatorade’s market share should improve this year but will likely still fall from the prior year, according to a Citi Research note from February.
Gatorade President Mike Del Pozzo told CNBC that the competition is good for the category overall – and shows his brand’s own strength.
“There’s plenty of loud voices right now, trying to make a name for themselves,” said Del Pozzo. “This is a competitive business, and because we’re in the business of sports, we love competition. Clearly, we’re winning, and I think many of them are spending more time on talking about us and less about their own brand, the consumer approach.”
For its part, Gatorade has been thinking about its own pitch to consumers. Del Pozzo said that the line between hydration and wellness has blurred, and more consumers are focused on hydrating throughout their day, not just during exercise.
They now like low- or no-sugar drinks, “functional” beverages that tout health benefits like improving immunity and alkaline water, he said.
Gatorade has responded by branching out with new products: Gatorade Zero Sugar, tablets with vitamin C and zinc for immune support, a Pedialyte lookalike called Gatorlyte, a caffeinated spinoff called Fast Twitch and its first unflavored alkaline water, which launched nationwide in February.
“It’s off to a great start so far, but we were super patient to get it right,” Del Pozzo said about Gatorade Water, which has about a fifth of the electrolytes found in classic Gatorade.
Year to date, Gatorade is gaining share in every hydration category it has products, according to market research firm Circana. And Propel’s annual sales are projected to cross $1 billion for the first time this year, Del Pozzo said.
Gatorade’s long history has given the brand the ability to step into new categories and blur the lines, according to Rabobank’s Watson.
“This is one of the brands that has the best marketing campaigns, such great brand equity, consumer awareness, consumer love,” he said.
For now, classic Gatorade remains the brand’s top seller. More

Boeing CEO Dave Calhoun said he would step down by the end of the year amid Boeing’s 737 Max safety crisis.
Boeing said Calhoun’s total compensation for 2023 was $32.8 million, up from $22.6 billion.
The company said it will tie more executive compensation to safety goals going forward.

Boeing CEO Dave Calhoun speaks with reporters on Capitol Hill in Washington, D.C., before meeting with a group of senators on Jan. 24, 2024.
Jim Watson | AFP | Getty Images

Outgoing Boeing CEO Dave Calhoun’s take-home pay fell to $5 million last year after declining a bonus, compared with $7 million in 2022, and his latest compensation package is taking a hit from the prolonged safety crisis surrounding the company’s bestselling jetliner, the 737 Max.
Calhoun’s total compensation last year rose 45% to $32.8 million, up from $22.6 million in the prior year. But Boeing said the 2023 sum is closer to $23.5 million, as it includes long-term incentives such as stock. Shares of the plane-maker are down almost 30% this year.

Total compensation for Stan Deal, whom Boeing last month replaced at the top of the commercial airplanes division, rose 42% to $12.5 million.
Calhoun last month said he would step down by the end of the year. His departure is part of a broad shake-up in which the company also replaced its chairman and head of its commercial airplane unit. The manufacturer is grappling with the fallout of a door plug panel that blew out midair from a 737 Max operated by Alaska Airlines in January.
Boeing disclosed the take-home pay, which did not include a 2023 bonus Calhoun declined that was valued at $2.8 million, and executive compensation in a filing Friday. The company said it will now more closely tie executive compensation to safety goals.
“I promise that I personally, and we as a Board, will leave no stone unturned in our efforts to get this company where it needs to be,” newly named Boeing Chairman Steve Mollenkopf said in a message to shareholders in a filing Friday.
The Jan. 5 accident has slowed deliveries of new jets and Boeing has said it will burn more cash than it previously expected. The company is scheduled to release first-quarter results April 24.

Calhoun took the helm at Boeing in January 2020 after his predecessor was ousted for his handling of the aftermath of two fatal crashes of the 737 Max. In addition to the Covid-19 pandemic’s devastating effect on the aviation industry, Boeing has also had a host of quality defects on its aircraft. Those have slowed deliveries of new planes to customers clamoring for fresh jets as travel snapped back, hurting Boeing’s cash flow.
The Alaska Airlines door plug near-catastrophe was the most serious issue since the crashes. The Justice Department is investigating the Alaska Airlines accident and the Federal Aviation Administration has capped Boeing’s 737 Max production until it signs off on Boeing’s quality control.
Boeing said on Friday that “operational performance metrics for all business units will be focused exclusively on quality and safety goals” this year and that long-term executive incentives could be reduced to zero if goals are not met.
Boeing last posted an annual profit in 2018.
Clarification: CEO Dave Calhoun’s total 2023 compensation is closer to $23.5 million. An earlier version contained a figure that was later updated by Boeing.

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The Walt Disney Company has updated its theatrical slate.
Disney revealed that one of its 2026 Star Wars films would be “The Mandalorian & Grogu,” featuring the iconic duo from its Disney+ series “The Mandalorian,” slated for theatrical release on May 22, 2026.
A fifth “Toy Story” film is set to hit theaters on June 19, 2026, and “Tron: Ares” is scheduled for Oct. 10, 2025.

The Mandalorian and the Child (Grogu) on Disney+’s “The Mandalorian.”

The Walt Disney Company on Friday revealed its new theatrical schedule, which will feature a film about the Mandalorian and Grogu, a fifth “Toy Story” film, and another “Tron” flick before the end of 2026.
The company’s theatrical business has struggled in the wake of pandemic shutdowns and dual Hollywood labor strikes, as productions stalled and moviegoers’ box-office habits shifted. All the while, Disney struggled to connect with audiences, which further exacerbated revenue woes.

Since returning to the helm at Disney in late 2022, CEO Bob Iger has been working to right the ship. He’s admitted that the quality of its films suffered in its bid to pump out a high quantity of entertainment content.He said brands such as Marvel, in particular, needed to be more selective about which sequels get made.
Iger also said he would no longer tolerate his company’s partners and creative team prioritizing messaging over storytelling.
Disney’s updated slate features several iconic franchises, as well as some releases for adult audiences.
Notably, the company’s “Moana” sequel has been pushed to July 2026. It was originally slated to open in 2025.
“The Amateur,” a 20th Century Production starring Oscar winner Rami Malek, moved to April 2025 from its previous November 2024 date. And “Nightbitch,” a Searchlight feature with Amy Adams attached, will release in December 2024.

Disney teased that one of its 2026 Star Wars films would feature the iconic duo from its Disney+ series “The Mandalorian” and revealed its title will be “The Mandalorian & Grogu.” It is slated for theatrical release on May 22, 2026.
A fifth “Toy Story” film is set to hit theaters on June 19, 2026, and “Tron: Ares” is slated for Oct. 10, 2025. More

Skydance Media, RedBird Capital and KKR want to take a significant minority or slight majority stake in a publicly traded Paramount Global, sources told CNBC.
The consortium has entered exclusive talks with Paramount Global to try to reach a deal.
Skydance CEO David Ellison and RedBird’s Jeff Shell, the former CEO of NBCUniversal, would both have leadership roles in a new company if a deal is approved, sources told CNBC.

Skydance Media’s offer to acquire National Amusements and merge its studio with Paramount Pictures isn’t a conventional takeover. The question for Paramount Global shareholders might be: Is it better than no deal at all?
Skydance has made a unique pitch to Paramount Global’s special committee, in charge of accepting or rejecting transactions, and its investors, according to four people familiar with the parameters of the offer. Paramount Global would continue to trade publicly. Skydance would own either a substantial minority stake or a majority stake in Paramount Global by merging its assets and raising new equity, which it would acquire along with its private equity partners RedBird Capital Partners and KKR.

The consortium’s ownership percentage in the new company could be around 45% or just over 50%, said the people, who asked not to be named because the discussions are private. No details have been nailed down and are all still subject to change, the people said.
Spokespeople for Paramount Global and Skydance declined to comment.
The new equity will be dilutive for existing shareholders. But it will align voting and economic control in a way that hasn’t been the case with the Redstone family, which currently directly or indirectly owns 77% of the Class A voting stock of Paramount Global and 5.2% of the Class B common stock, about 10% of the overall equity of the company.
While Skydance CEO David Ellison is primarily in charge of orchestrating the deal, his father, Oracle co-founder and Chairman Larry Ellison, would be putting up some of the new funding, said the people. He would also potentially provide Paramount Global with access to artificial intelligence software and other data technology from Oracle.
Paramount Global has many valuable legacy media assets, including CBS, the Paramount Pictures studio and its physical lot, a studio library with films such as “The Godfather,” “Titanic,” and “Forrest Gump” and cable networks such as Comedy Central and Nickelodeon. It also owns its subscription streaming service Paramount+, with more than 67.5 million subscribers, and its free advertising supported service Pluto TV, with more than 80 million monthly active users.

Still, it’s struggled to grow in recent years. Paramount Global’s annual revenue for 2023 was $29.7 billion, a 1.7% decline from 2022. Paramount+ continues to lose money. Paramount Global’s debt rating was cut to junk by S&P Global Ratings last month because the company’s broadcast and cable TV business is declining as traditional pay TV subscribers cancel.
Paramount Global has a market capitalization of about $7.6 billion and had $14.6 billion in long-term debt at the end of 2023. When CBS and Viacom merged in 2019, the combined market value of the company was about $30 billion.
Shares were trading about 5% lower Friday.

The Skydance plan

In the past decade, Oracle successfully transformed from a legacy enterprise technology company to a cloud services and AI-focused business. That provides a similar thematic blueprint for what the Ellisons would like to do with Paramount Global – a legacy media company that needs to lean into the future to justify its existence.
David Ellison would likely lead the new company.
Former NBCUniversal CEO Jeff Shell, in his capacity as chairman for sports and media at RedBird, is also expected to have a major leadership role. Management would be open to divestitures that current CEO Bob Bakish has examined but ultimately rejected, such as selling BET Media Group and Showtime, the people said.
New leadership would also assess more existential questions to Paramount Global, such as the future of Paramount+ and what the company’s role should be in a broader media ecosystem. No decisions have been made yet about these larger strategies, the people said.

Better than nothing

The transaction as proposed isn’t a full takeover of Paramount Global. That’s what Paramount Global’s board would prefer, but Ellison has balked, the people said.
Still, the message to investors will be that the combination of David Ellison, his dad’s involvement, Shell, Skydance’s assets and its commitment to new media (including Skydance’s video game development studio) is simply better for future growth than Redstone and Bakish.
The Paramount Global special committee will need to decide if Skydance’s complicated transaction is better than the status quo — and also better than any other offer that may still come. The two sides have entered exclusive talks to do deeper due diligence and potentially reach a deal in the coming month or two, the people said.
There still could be other avenues to pursue. Private equity firm Apollo Global Management lobbed in a recent bid of $26 billion for the entire company, The Wall Street Journal reported this week. But the Paramount Global special committee has chosen to move forward with the Skydance talks in exclusivity. Redstone has unofficially sought a buyer for Paramount Global for years, according to people familiar with the matter. The late offer by Apollo may be an attempt to keep the private equity firm around the hoop in case the Skydance transaction falls through.
Warner Bros. Discovery held preliminary discussions with Paramount Global but stopped working on a deal earlier this year, CNBC reported in February.
WATCH: Faber report: Paramount Global deal moves to fast lane

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Spire Global — which offers information on weather, climate, and ship and aircraft movements, as well as has a space services business — is hoping weather forecasting can become even more more accurate.
CEO Peter Platzer said the radio frequency sensing company sees a huge potential for such improvements.
He also said a new partnership with Nvidia will inspire “more valuable products and new use cases.”

Spire Global at the New York Stock Exchange, August 17, 2021.
Source: NYSE

Artificial intelligence has been instrumental to weather forecast modeling for years, and recent breakthroughs in generative AI dangle the possibility of it becoming more accurate.
That’s what Spire Global is betting on in its recently announced partnership with AI darling Nvidia.

“What deep learning and neural networks and generative AI have done is they have shifted the power from those who have access to supercomputers a bit more to those who have access to super data,” Peter Platzer, CEO and co-founder of Spire Global, told CNBC’s Morgan Brennan in an interview on CNBC’s “Manifest Space” podcast. 
“Because the supercomputer side with a model has been replaced with hyper efficient GPUs [graphics processing units], you can run something that used to take eight hours, and you can now run it in eight seconds,” he explained. “For us, that has been always a vision that we knew eventually was going to come, so when this [Nvidia] partnership became possible, we jumped on that.”
Twelve-year old Spire Global is in the radio frequency sensing business, operating a satellite constellation that collects space-based radio frequency data that can be analyzed and sold as a service. It offers information on weather, climate, and ship and aircraft movements, as well as has a space services business.
The opportunity in weather forecasting, though, is huge: A third of the global economy — roughly $30 trillion worth of global GDP — ranging from trade to agriculture to power generation is subject to weather, according to Platzer.
He estimates there are some 175 major use cases across up to 200,000 customers or customer types globally when it comes to weather forecasting. In other words, the need for more accurate forecasts, particularly with more lead time, is in high demand.

Follow and listen to CNBC’s “Manifest Space” podcast, hosted by Morgan Brennan, wherever you get your podcasts.

So what does this collaboration with Nvidia entail?
“It allows us access to their infrastructure to serve our customers better, with more valuable products and new use cases … and them access to our data to improve their modeling, their machinery,” Platzer said.
Nonetheless, “at this point in time there is no immediate economic flow from Nvidia to Spire or vice versa,” he noted.
As has been the case with a growing list of companies working with the semiconductor stalwart, investors reacted favorably to the news, which was disclosed at Nvidia’s GTC developer conference in March.
Nvidia CEO Jensen Huang unveiled a “digital twin” of Earth called Earth-2 onstage that essentially pairs the open cloud platform with Nvidia’s generative AI model CorrDiff and Spire’s satellite data to improve existing weather and climate prediction models.
Spire Global, a small capitalization stock that went public through a SPAC merger in 2021, shot up roughly 40% in response.
Spire then raised $30 million through a direct offering of common stock to two institutional investors — an offering that closed last week.
“We had a number of investors competing to get in on the Spire story,” Platzer said. “For us, it means that we can deliver the balance sheet, we can lower our cost of capital, we can create more flexibility … we’re going to have fewer debt payments, which increases our free cash flow and that helps us on that path to free cash flow profitability.”
Spire Global forecasts achieving positive free cash flow this summer, or by the third quarter of 2024.

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