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American Airlines posted a third-quarter loss on Thursday and trimmed its profit forecast for the year.
The carrier said Thursday it expects to earn between $2.25 and $2.50 a share, on an adjusted basis, for the year, down from an estimate in July.

American Airlines posted a third-quarter loss on Thursday and trimmed its profit forecast for the year, partly in response to higher fuel prices.
The carrier said Thursday it expects to earn between $2.25 and $2.50 a share, on an adjusted basis, for the year, down from an estimate in July of $3 to $3.75 but largely in line with analyst expectations. American said it expects a full-year adjusted operating margin of 7%, down from a previous forecast for as wide a margin as 10%.

For the fourth quarter, American estimated it would break even.
Here’s how American Airlines performed in the third quarter compared with what Wall Street anticipated, based on an average of analysts’ estimates compiled by LSEG, formerly known as Refinitiv:

Adjusted earnings per share: 38 cents vs. 25 cents expected
Total revenue: $13.48 billion vs. expected $ 13.52 billion

While airlines have enjoyed a resurgence of travel since the pandemic ended, especially for international destinations, fares broadly have dropped from last year.

Boeing 787-9 Dreamliner, from American Airlines company, taking off from Barcelona airport, in Barcelona on 24th February 2023. 
JanValls | Nurphoto | Getty Images

American said it expects unit revenue in the fourth quarter to drop between 5.5% and 7.5% from a year earlier with unit costs, excluding fuel, up 5% to 7% year over year and capacity up 4.5% to 6.5% from the same period of 2022.
The company lost $545 million, or 83 cents per share, during the third quarter, down from a profit of $483 million, or 69 cents per share during the same period a year earlier. It was the carrier’s first loss since the first quarter of 2022. Capacity was up 7% from a year ago.

| Jim Cramer’s Investing Club shares what investors should listen for in a company’s earnings call
CEO Robert Isom told staff in a note that “while there were bumps along the way, such as significantly higher fuel costs that resulted in lower earnings in the quarter, our team continues to excel at controlling what we can control, which will make us successful no matter the environment.”
Adjusting for higher costs associated with the pilots’ new labor agreement, the company reported earnings of $263 million, or 38 cents per share.
Revenue was up 0.1% from the year-ago period. More

IN THE 1950s the oil market was in the gift of the “Seven Sisters”. These giant Western firms controlled 85% of global crude reserves, as well as the entire production process, from the well to the pump. They fixed prices and divvied up markets between themselves. Trading oil outside of the clan was virtually impossible. By the 1970s that dominance was cracked wide open. Arab oil embargoes, nationalisation of oil production in the Persian Gulf and the arrival of buccaneering trading houses such as Glencore, Vitol and Trafigura saw the Sisters lose their sway. By 1979, the independent traders were responsible for trading two-fifths of the world’s oil.image: The EconomistThe world is in turmoil again—and not only because the conflict between Israel and Hamas is at risk of escalating dangerously. Russia’s war in Ukraine, geopolitical tensions between the West and China, and fitful global efforts to arrest climate change are all injecting volatility into oil markets (see chart 1). Gross profits of commodity traders, which thrive in uncertain times, increased 60% in 2022, to $115bn, according to Oliver Wyman, a consultancy. Yet this time it is not the upstarts that have been muscling in. It is the descendants of the Seven Sisters and their fellow oil giants, which see trading as an ever-bigger part of their future.The companies do not like to talk about this part of their business. Their traders’ profits are hidden away in other parts of the organisation. Chief executives bat away prying questions. Opening the books, they say, risks giving away too much information to competitors. But conversations with analysts and industry insiders paint a picture of large and sophisticated operations—and ones that are growing, both in size and in sophistication.In February ExxonMobil, America’s mightiest supermajor, which abandoned large-scale trading two decades ago, announced it was giving it another go. The Gulf countries’ state-run oil giants are game, too: Saudi Aramco, Abu Dhabi National Oil Company and QatarEnergy are expanding their trading desks in a bid to keep up with the supermajors. But it is Europe’s oil giants whose trading ambitions are the most vaulting.image: The EconomistBP, Shell and TotalEnergies have been silently expanding their trading desks since the early 2000s, says Jorge Léon of Rystad Energy, a consultancy. In the first half of 2023 trading generated a combined $20bn of gross profit for the three companies, estimates Bernstein, a research firm. That was two-thirds more than in the same period in 2019 (see chart 2), and one-fifth of their total gross earnings, up from one-seventh four years ago. Oliver Wyman estimates that the headcount of traders at the world’s largest private-sector oil firms swelled by 46% between 2016 and 2022. Most of that is attributable to Europe’s big three. Each of these traders also generates one and a half times more profit than seven years ago.Today BP employs 3,000 traders worldwide. Shell’s traders are also thought to number thousands and TotalEnergies’ perhaps 800. That is almost certainly more than the (equally coy) independent traders such as Trafigura and Vitol, whose head counts are, respectively, estimated at around 1,200 and 450 (judging by the disclosed number of employees who are shareholders in the firms). It is probably no coincidence that BP’s head of trading, Carol Howle, is a frontrunner for the British company’s top job, recently vacated by Bernard Looney.The supermajors’ trading desks are likely to stay busy for a while, because the world’s energy markets look unlikely to calm down. As Saad Rahim of Trafigura puts it, “We are moving away from a world of commodity cycles to a world of commodity spikes.” And such a world is the trader’s dream.One reason for the heightened volatility is intensifying geopolitical strife. The conflict between Israel and the Palestinians is just the latest example. Another is the war in Ukraine. When last year Russia stopped pumping its gas west after the EU imposed sanctions on it in the wake of its aggression, demand for liquefied natural gas (LNG) rocketed. The European supermajors’ trading arms were among those rushing to fill the gap, making a fortune in the process. They raked in a combined $15bn from trading LNG last year, accounting for around two-fifths of their trading profits, according to Bernstein.This could be just the beginning. A recent report from McKinsey, a consultancy, models a scenario in which regional trade blocs for hydrocarbons emerge. Russian fuel would flow east to China, India and Turkey rather than west to Europe. At the same time, China is trying to prise the Gulf’s powerful producers away from America and its allies. All that is creating vast arbitrage opportunities for traders.Another reason to expect persistent volatility is climate change. A combination of increasing temperatures, rising sea levels and extreme weather will disrupt supply of fossil fuels with greater regularity. In 2021 a cold snap in Texas knocked out close to 40% of oil production in America for about two weeks. Around 30% of oil and gas reserves around the world are at a “high risk” of similar climate disruption, according to Verisk Maplecroft, a risk consultancy.Then there is the energy transition, which is meant to avert even worse climate extremes. In the long run, a greener energy system will in all likelihood be less volatile than today’s fossil-fuel-based one. It will be more distributed and thus less concentrated in the hands of a few producers in unstable parts of the world. But the path from now to a climate-friendlier future is riven with uncertainty.Some governments and activist shareholders are pressing oil companies, especially in Europe, to reduce their fossil-fuel wagers. Rystad Energy reckons that partly as a result, global investment in oil and gas production will reach $540bn this year, down by 35% from its peak in 2014. Demand for oil, meanwhile, continues to rise. “That creates stress in the system,” says Roland Rechtsteiner of McKinsey.Future tradersThis presents opportunities for traders, and not just in oil. Mr Rechtsteiner notes that heavy investment in renewables without a simultaneous increase in transmission capacity also causes bottlenecks. In Britain, Italy and Spain more than 150-gigawatts’-worth of wind and solar power, equivalent to 83% of the three countries’ total existing renewables capacity, cannot come online because their grids cannot handle it, says BloombergNEF, a research firm. Traders cannot build grids, but they can help ease gridlock by helping channel resources to their most profitable use.Europe’s three oil supermajors are already dealing in electric power and carbon credits, as well as a lot more gas, which as the least grubby of fossil fuels is considered essential to the energy transition. Last year they had twice as many traders transacting such things than they did in 2016. Ernst Frankl of Oliver Wyman estimates that gross profits they generated rose from $6bn to $30bn over that period. Other green commodities may come next. David Knipe, a former head of trading at BP now at Bain, a consultancy, expects some of the majors to start trading lithium, a metal used in battery-making. If the hydrogen economy takes off, as many oil giants hope, that will offer another thing not just to produce, but also to buy and sell. ■To stay on top of the biggest stories in business and technology, sign up to the Bottom Line, our weekly subscriber-only newsletter. More

Purveyors of chipmaking tools seldom attract attention. Yet many investors’ heads turned on October 13th, when Canon unveiled a new piece of kit. It is easy to see why. The Japanese company, which makes optical equipment, claims that its “nanoimprint” lithography machine can etch the very smallest transistors used in the most advanced microchips. Such feats have hitherto been the preserve of ASML, a Dutch manufacturer of lithographic tools. Canon hopes to eat further into ASML’s business by eventually cranking out two-nanometre chips.The possibility of breaking ASML’s stranglehold on the supply chain for cutting-edge chips is intriguing. The firm has long enjoyed the biggest monopoly in the concentrated semiconductor industry. The world’s three biggest chip manufacturers—Intel, Samsung and TSMC—depend entirely on its extreme-ultraviolet (EUV) technology to produce the cutting-edge microprocessors that go into smartphones and the powerful data-centre servers on which the computing cloud lives.ASML’s EUV rigs use high-powered lasers to etch electrical blueprints onto circular silicon discs. Canon’s alternative, by contrast, directly stamps chip designs on such wafers using a patterned mould. In theory, this allows it to make more detailed patterns. And because it involves fewer steps and avoids the need for expensive lasers and supersmooth mirrors, it could be much cheaper than EUV lithography. ASML’s share price dipped by more than 2% and Canon’s rose by nearly as much on the nanoimprint news.In practice, Canon has its work cut out. Dylan Patel of SemiAnalysis, a semiconductor-research firm, points out that nanoimprint lithography is prone to defects because of the precision required to align wafers and moulds. The technique is also not yet effective in dealing with complex chip designs, including for processors used in artificial-intelligence models, that involve many layers of chemical deposits. Mr Patel predicts that Canon’s tool will be used for making parts of memory chips, which have fewer layers, rather than for advanced “logic” chips, which process information rather than store it.Even if Canon can overcome all these technical hurdles, chipmakers may be loth to replace their EUV kit with its machines. Chip fabrication plants (fabs for short) are highly standardised in order to minimise the share of chips that turn out faulty. Since ASML has long been the only game in town for cutting-edge chips, that standardisation means that fabs are being designed around its machines, which are the size of a double-decker bus. The fabs that chipmakers are currently busy putting up around the world will not suddenly switch to nanoimprint lithography. It may take five years for Canon’s tools to be used in mass production, thinks Gaurav Gupta of Gartner, a research firm, and only once they have proved themselves.One place where Canon could make headway more quickly is China. Since 2019 Chinese companies have been prevented by America’s export controls from buying ASML’s EUV machines, since they all rely on bits and bobs of American origin. It has also struggled to develop lithography machines of its own. The current American restrictions do not, however, explicitly cover nanoimprint technology. That leaves Canon free to sell it to customers across the Sea of Japan—at least for the time being and perhaps for longer. It is unclear whether the Japanese firm’s machines include enough American know-how to ever fall under America’s anti-Chinese strictures. Probably no necks craned more at Canon’s announcement than those of national-security hawks in Washington and Beijing. ■To stay on top of the biggest stories in business and technology, sign up to the Bottom Line, our weekly subscriber-only newsletter. More

Indian plutocracy can seem set in stone. The top two spots in the annual rich list compiled by Hurun, which tracks such things, invariably go to the Ambani and Adani clans. This year is no different. Mukesh Ambani came in first, with a fortune of $98bn. He displaced Gautam Adani, a rival industrialist and last year’s winner, whose riches clocked in at $58bn. Peer lower down the ranking, though, and the story is one of change. First, the ranks of India’s ultra-wealthy are growing. Hurun’s lastest list identifies 1,319 fortunes of $120m or more (its benchmark for inclusion). That is 216 more than last year. The main sources of affluence are not what you might consider the traditional routes to riches, such as industry, finance and information technology. Instead they are consumer goods, materials and health care. Alkem Laboratories, a maker of generic drugs, helped elevate 11 people onto the list, the most of any company. Asian Paints lifted ten, Tube Investments of India, which expanded from producing bicycle parts to various other components, eight, and Pidilite Industries, a maker of adhesives, seven. The demography and geography of Indian wealth is broadening, too. The 20-year-old founder of Zepto, a delivery firm, makes an appearance, as does, for the first time, the 94-year-old founder of Precision Wires India, a maker of electrical cabling. Most of India’s rich still hail from Mumbai (328), Delhi (199) and Bangalore (100), India’s commercial, political and tech capitals, respectively. But 21 other cities made the cut this year, bringing the total number of places plutocrats call home to 95. And although plenty of rich Indians are still based abroad, most of the new money is at home. Most of it is also the product of the real economy rather than of financial engineering. Only one private-equity baron made the list—Manish Kejriwal, founder of Kedaara Capital, and his family is worth $360m. The biggest rewards in India still accrue to the builders rather than to the moneymen. ■To stay on top of the biggest stories in business and technology, sign up to the Bottom Line, our weekly subscriber-only newsletter. More

Luck plays a big and often unacknowledged part in career success, starting in the womb. Warren Buffett has talked of winning the “ovarian lottery” by being born in America when he was, and being wired in a way that pays off in a market economy. Good looks are associated with higher pay and a greater chance of being called to interview in hiring processes. Your experience of discrimination will reflect your circumstances of birth.The early way-stations in a career are often marked by chance: a particularly encouraging boss, say, or an assignment that leads you off in an unexpected but defining direction. Luck can affect the pathways of the most rational-minded professions. A paper published in 2022 by Qi Ge of Vassar College and Stephen Wu of Hamilton College found that economists with harder-to-pronounce names, including within ethnic groups, were less likely to be placed into academic jobs or get tenure-track positions.Names can work against economists in other ways. Another study, by Liran Einav of Stanford University and Leeat Yariv, now of Princeton University, found that faculty with earlier surname initials were more likely to receive tenure at top departments, an effect they put down to the fact that authors of economics papers tend to be listed alphabetically.Performing well can be due to luck, not talent. In financial markets, asset managers who shine in one period often lose their lustre in the next. The rise of passive investing reflects the fact that few stockpickers are able persistently to outperform the overall market. The history of the oil industry is shot through with stories of unexpected discoveries. A recent paper by Alexei Milkov and William Navidi of the Colorado School of Mines found that 90% of industry practitioners believe that luck affects the outcome of exploration projects. The authors’ analysis of 50 years of drilling on the Norwegian Continental Shelf concluded that the differences in success rates between individual firms were random.There is a long-running debate about whether luck affects executives’ pay. A recent paper by Martina Andreani and Lakshmanan Shivakumar of London Business School and Atif Ellahie of the University of Utah suggests that it does. The academics looked at the impact of a big corporate-tax cut in America in 2017, an event which resulted in large one-off tax gains and losses for firms that were based on past transactions and that could not be attributed to managers’ skills. They found that larger windfall gains led to higher pay for CEOs of less scrutinised firms; tax losses did not seem to affect their earnings. Lucky things.Just as some people blindly believe that merit determines success, so it is possible to get too hung up on the role of chance. CEOs may well be rewarded for luck but slogging to the top of companies involves talent and hard work. Although some have argued that entrepreneurs are simply people fortunate enough to have a large appetite for risk, skill does matter. A paper from 2006 by Paul Gompers of Harvard University and his co-authors showed that founders of one successful company have a higher chance of succeeding in their next venture than entrepreneurs who previously failed. Better technology and greater expertise reduce the role of chance; the average success rates in oil exploration, for example, have gone up over time.But if luck does play a more important role in outcomes than is often acknowledged, what does that mean? For individuals, it suggests you should increase the chances that chance will work in your favour. Partners at Y Combinator, a startup accelerator, encourage founders to apply to their programmes by talking about increasing the “surface area of luck”: putting yourself in situations where you may be rejected is a way of giving luck more opportunity to strike.An awareness of the role that luck plays ought to affect the behaviour of managers, too. Portfolio thinking reduces the role of luck: Messrs Milkov and Navidi make the point that the probability of striking it lucky in oil exploration goes up if firms complete numerous independent wells. If luck can mean a bad decision has a good result, or vice versa, managers should learn to assess the success of an initiative on the basis of process as well as outcome.And if the difference between skill and luck becomes discernible over time, then reward people on consistency of performance, not one-off highs. Mr Buffett might have had a slice of luck at the outset, but a lifetime of investing success suggests he has maximised it.■Read more from Bartleby, our columnist on management and work:Trialling the two-day workweek (Oct 12th)How to make hot-desking work (Oct 5th)What if Hollywood blockbusters were remade as workplace dramas? (Sep 28th)Also: How the Bartleby column got its name More

Kohl’s holiday season will reflect the retailer’s latest effort to refresh its stores and lift its stock.
The company is adding more pet merchandise, home decor, and impulse and gifting items to drive sales.
It marks the first holiday season overseen by Kohl’s new CEO, Tom Kingsbury, and chief merchant Nick Jones.

At Kohl’s stores, Chief Merchant Nick Jones said shoppers will see a mix of elevated items and sharp price points. For example, the company has signs that call attention to low prices of some sweaters, but is also has added European-made glassware to its home decor.
Melissa Repko | CNBC

As shoppers head to Kohl’s stores this holiday season, they will see gift ideas, Christmas ornaments and a potential glimpse of the retailer’s future.
It marks the first peak shopping season overseen by Kohl’s new CEO, Tom Kingsbury. The retail veteran, who previously led off-price chain Burlington Stores, officially stepped into the role early this year after serving on an interim basis. He succeeded Michelle Gass, who departed to become CEO-elect of Levi Strauss.

Kohl’s kicked off the latest effort to refresh its brand as it navigates a confusing economic backdrop, and after it faced scrutiny from activist investors and failed to secure a deal to sell to the Franchise Group, owner of The Vitamin Shoppe. Its sales and stock price have lagged.
As it tries to turn around its fortunes, Kohl’s has focused on sharpening the look of its stores and the brands and merchandise it carries, Kingsbury said. By leaning into popular brands and categories, he said the company could return to sales growth in 2024.
“Home decor, pet, gifting, impulse, all the things that we’ve been talking about will really help us get there,” he told investors on an August earnings call.
Net sales for Kohl’s most recent full fiscal year, which ended in January, totaled $17.2 billion — a nearly 9% drop from the fiscal year that ended in early 2020, shortly before the Covid pandemic shook up spending patterns.

Shares of the company are down about 17% this year, underperforming the 12% gains of the S&P 500 and the roughly flat performance of the retail ETF, the XRT.

Kohl’s has forecast that full-year sales will decline by 2% to 4%, including the approximately 1% impact of a fiscal year that’s one week shorter.
Along with its own strategy shift, Kohl’s is gearing up for a season when consumers have sent conflicting messages about how much they’re willing to spend and what they think is worth buying, even as some tighten their belts.
At a store tour in Ramsey, New Jersey, this week, even some timely items like Christmas decor and fall sweaters were 40% or 50% off — an indicator that the retailer is trying to move merchandise and appeal to more budget-minded customers.
“We know they’re stretched,” Chief Marketing Officer Christie Raymond said. She said the company is watching factors like rising credit card debt, dwindling savings and the return of pandemic-paused student loan payments.
But she added shoppers are still spending — sometimes starting early to hunt for the best deals or perfect items that seem worth the money.
Kohl’s set its holiday merchandise at stores in the first week of October, weeks earlier than the pre-pandemic holiday season in 2019 and even earlier than the past couple of years, when Covid threw off the typical shopping cadence, Raymond said.
Here are major strategies that Kohl’s is leaning into this holiday season and beyond:

Beauty is one of the rare discretionary categories where shoppers have been splurging, despite inflation. Kohl’s has leaned in by opening more Sephora shops inside of its stores.
Melissa Repko | CNBC

Betting on beauty

From perfume to mascara, beauty is one of rare categories where shoppers have continued to splurge — even as they deal with pricier groceries, higher interest rates and bigger utility bills.
Kohl’s has leaned into that by adding more Sephora shops to its stores. This holiday season, it will have about 900 of the shops — meaning they’re now in the vast majority of its more than 1,100 stores across the country. It will carry some exclusive items, too, like gift sets only sold at Kohl’s.
It’ll be a bigger part of this holiday season. A year ago, roughly half of Kohl’s stores had a Sephora shop. Two holiday seasons ago, which marked its first with the beauty shops, they were in 200 locations.
Sephora at Kohl’s has been one of the company’s brightest spots, especially during a time when customers have become more reluctant to spring for discretionary items. Total beauty sales for the company rose nearly 90% year over year as of July 29, the end of the most recent fiscal quarter.
Raymond said Sephora has drawn younger, more diverse shoppers to stores, but also been popular with Kohl’s longtime customers.
In the next few years, Kohl’s plans to open smaller versions of the shops in the rest of its stores. And it’s looking for ways to get those new customers it’s reeled in to browse and buy merchandise from other parts of the store, said Nick Jones, the company’s new chief merchandising and digital officer. He joined Kohl’s earlier this year, after working for British retailers, including Marks & Spencer and ASDA/Walmart UK.

Kohl’s has expanded areas where shoppers can grab last-minute items.
Melissa Repko | CNBC

Leaning into impulse buys

As shoppers rush around during the peak shopping season, Kohl’s wants to tempt them to grab one — or ideally, two or three — more things.
Kohl’s has made more room in the cash register area for impulse items and stocking stuffers, such as candies, small toys and stuffed animals. It also has a dedicated display of grab-and-go beauty items from Sephora, such as face masks or lipsticks.
It’s also sprinkled gift ideas throughout its stores, such as aisles where customers may spot a Barbie dream house for their child or a high-tech toaster oven for their sister-in-law.
Jones said Kohl’s wants to simplify the season for busy families. That means not only having a wide variety of merchandise, but also guiding them toward good deals with signs that advertise discounts and displays that include creative gift ideas, such as a colorful sweater, children’s books or a collection of hot sauces.
It also cleared away space in the front of stores by taking out some cash registers, so that customers see trend-driven or seasonal items when they walk in.

Kohl’s sells cookware and throw pillows, but it’s adding more home decor like wall art and vases, too.
Melissa Repko | CNBC

A haul for the home

Home goods may have been a hot pandemic category, but Kohl’s is betting it’s a big business opportunity now.
During the holiday season, shoppers may notice an expanded mix of items that could spruce up their homes, or help as they host friends or look for something to go under the Christmas tree. For example, stores are carrying more glassware and items for party hosts, such as copper mugs, champagne flutes and cocktail shakers.
Kohl’s already sold bedding, small appliances, picture frames and more. Yet on the company’s earnings call in August, Kingsbury spoke about home goods as one of the company’s biggest growth areas, saying it’s working with new vendors and adding lighting, wall art and more.
The demise of bankrupt Bed Bath & Beyond has created room for retailers, including Kohl’s, to grab more market share in the space. The economic backdrop could be a factor, too.
As some Americans decide against moving because of high interest rates, they may want to buy decorations to freshen up their current homes, Jones said.

Pet merchandise is getting more square footage at Kohl’s stores. The retailer is carrying dog and cat toys, but also items like shampoo and treats.
Melissa Repko | CNBC

And something for Fido, too

Add Kohl’s to the list of retailers trying to cash in on the pandemic pet boom.
The retailer is dedicating more square footage to dog beds, cat towers and some pet items that get replenished more frequently, such as treats and shampoo.
Kohl’s decided to expand across the chain after a successful test at 50 stores last fall, Kingsbury said on the earnings call in August. The company wouldn’t quantify the number of stores with more pet merchandise, but Jones said the Ramsey store, which reflects its holiday look, has twice the amount of items in the category that it did a year ago.
Other retailers have also zeroed in on the category, which has historically been more resilient during recessions and economic downturns. Lowe’s struck a deal with Petco Health & Wellness to open mini shops in a growing number of its stores and Walmart recently announced the opening of its first pet health center with vet care. More

Netflix will air “The Netflix Cup,” a golf event that will showcase athletes from Formula 1 and the PGA Tour, making it Netflix’s first-ever live sports event.
The streamer is leaning more into sports, another tactic in boosting its audience and holding onto subscribers.
Live sports still grabs the best ratings on traditional TV, even as customers flee the bundle, and streamers such as Netflix are looking to reap those benefits, too.

Rafael Henrique | Lightrocket | Getty Images

Whether it’s streaming or traditional TV, sports keep audiences coming back to their screens — and Netflix is working on getting more into the game.
Following some quarters of stagnation, Netflix is back to adding more subscribers, with the help of adding new business models such as a cheaper, ad-supported tier and cracking down on password sharing. Sports is sure to play a role in that.

The streamer is also finally taking a step toward live sports.
Netflix announced it would broadcast “The Netflix Cup” live, a matchup between athletes that appeared in the Formula 1 docuseries and the golf series “Full Swing.” The athletes will compete in a match play tournament in Las Vegas to kick off the week of the Formula 1 Heineken Silver Las Vegas Grand Prix.
Even though customers are fleeing traditional TV, from the cable-TV bundle to broadcast, those that stick around often do so for the live sports.
That showed in September, when the return of the National Football League and college football seasons propelled both broadcast and cable-TV viewership. Broadcast sports viewership was up 360%, compared to 222% during the same period last year, while cable TV got a nearly 25% increase in sports watchers, according to data from Nielsen.
This occurred as Disney’s ESPN carried the top 11 cable-TV telecasts during September, while streaming viewership dropped for the second-straight month — even if by less than 2% — as traditional TV took a greater share.

Streamers are increasingly adding sports programming. Warner Bros. Discovery’s Max started airing live sports earlier this month, and it plans to start charging for the additional streaming tier early next year. ESPN has its ESPN+ option, and Disney executives have said it’s a matter of when, not if, the cable TV channel becomes available via direct-to-consumer streaming. NBCUniversal’s Peacock has been growing due in large part to live sports.
When Netflix reported earnings Wednesday, it noted its “great success” with sports programming, which has been a mix of docuseries such as “Quarterback,” about a group of NFL quarterbacks heading into the new season, and “Formula 1: Drive to Survive,” which grew such a strong following that it boosted the sport itself.
Netflix’s push into advertising is also part of the mix. The company said Wednesday that T-Mobile and Nespresso will be among the sponsors for its first-ever live sports event.
It has been a gradual move toward both sports and live streaming — Netflix had technical issues when it aired the finale of reality show “Love is Blind” earlier this year — but one the streamer appears ready to make.
Disclosure: NBCUniversal is the parent company of NBC and CNBC.Don’t miss these CNBC PRO stories: More

Disney reorganized its company into three segments earlier this year, splitting ESPN and sports apart from its entertainment division.
As part of the split, investors are now getting a look under the hood at ESPN.
ESPN generated more than $12.5 billion in revenue for the nine months ending July 1.

SportsCenter at ESPN Headquarters.
The Washington Post | The Washington Post | Getty Images

The reorganization of Disney’s business is giving investors a glimpse at ESPN’s financials for the first time.
The inside look – which shows ESPN’s revenue has been decreasing in recent quarters – comes as the parent company looks for a strategic investor for what was long considered a crown jewel of the business.

Earlier this year, Disney announced a broad array of changes to its business that not only saw massive cost cuts and more than 7,000 employees laid off, but a restructuring of the company into three segments.
The company is now broken down into three divisions, one of which is an ESPN segment that includes the TV network and ESPN+ streaming service. This split sports from entertainment, which now includes most of its streaming and media operations. Parks, experiences and products make up the third unit.
Disney is scheduled to release fiscal fourth quarter earnings Nov. 8.
On Wednesday, Disney reported that its sports segment, which includes smaller contributions from Star India, had more than $13 billion in overall revenue for the nine months ended July 1, subtracting the amount from its entertainment segment revenue, where it was previously reported. ESPN generated more than $12.5 billion of that nine-month total.
Read more: Netflix is leaning more into sports programming

ESPN’s revenue – the domestic business makes up the bulk of ESPN’s revenue, with some coming from international – has fallen in recent quarters.
The network had roughly $4.06 billion in revenue in the third quarter, down from nearly $4.1 billion in the second quarter and about $4.4 billion in the first quarter, according to Wednesday’s filing.
The report shines a light on ESPN, the cable-TV network that has long raked in high traditional TV fees and viewership for the company – even during a time when the cable providers are losing customers at a fast clip in favor of streaming.
ESPN has been the linchpin not only of Disney’s cable-TV networks, but of the overall traditional bundle, reaping some of the highest TV fees. Last month, as football season kicked off, it ignited a carriage fight between Disney and cable provider Charter Communications, which ended in Disney channels being turned back on for customers and some getting access to it streaming services as part of the deal.
A part of the fight was Disney’s future prospects for ESPN on streaming. Disney plans to make the ESPN channel a direct-to-consumer option outside of the bundle for customers in the future.
The reorganization of Disney had been part of the company’s response to activist investor Nelson Peltz and helped to fend off his firm, Trian Fund Management for a few months. However, last week, Trian upped its stake in Disney and now a second proxy battle is brewing, CNBC reported. More