Wanna buy Warner Bros?

Hey Superheroes,

Global markets are stabilising despite policy uncertainty, patchy data, and ongoing geopolitical risks. The October 2025 United States federal government shutdown has dragged into its fourth week, stalling key economic releases and clouding the outlook.

Let’s dive into this week’s biggest stories.

Plot Twist at Warner Bros

Warner Bros Discovery (NASDAQ: WBD) is exploring a potential sale and the media world is holding its breath.

This week, the board confirmed it’s reviewing “strategic alternatives” after rejecting a nearly US$60 billion all-cash offer from Skydance-Paramount, valuing WBD at around US$24 per share.

Shares jumped 11% on the news, extending a 46% rally since September.

🎬 Blockbuster assets, fading cable

At stake is one of the world’s most iconic media portfolios. WBD owns Warner Bros Studios, HBO, CNN, DC Comics, and rights to global content juggernauts like Harry Potter, Game of Thrones and the Olympics broadcast rights in Europe.

But beneath the red carpet is a company under pressure. Streaming subscriber growth is slowing. Cable TV is bleeding viewers. And WBD is carrying around US$35 billion in debt, a legacy of its 2022 mega-merger.

In June, WBD unveiled a plan to split itself into two separate units: one housing its growing streaming and studio arm (Warner Bros), the other its declining legacy cable businesses (Discovery Global). That split remains in motion but the company is now open to selling the entire business, just Warner Bros or spinning off Discovery Global to enable a clean merger.

🧠 Who wants the keys to the kingdom?

David Ellison, CEO of Skydance Media and son of Oracle founder Larry Ellison, is one of the lead contenders. Having just merged Skydance Media with Paramount Global, Ellison reportedly made a second bid for Warner Bros to combine the two legacy giants into a new Hollywood heavyweight.

Analysts say his deep pockets – and his father’s ties to U.S. President Donald Trump – may help Skydance navigate antitrust scrutiny.

But they’re not alone. Comcast is circling. Netflix is interested, but only post-split (when it could buy the studio without the cable baggage). Apple and Amazon are also watching from the sidelines.

💸 Why this matters

A deal – or even a breakup – would reshape the global media landscape. If a full sale goes ahead, the buyer would control a deep content library, blockbuster IP and one of the last remaining full-stack legacy studios, but they’d also inherit the entire US$35 billion debt load and a business struggling to find its streaming footing. A deal for only the studio/streaming assets would inherit less debt.

Investors are hoping WBD doesn’t sell too early or too cheaply. One analyst estimates WBD’s real value is closer to US$30 per share, given the strength of its intellectual property.

For now, it’s Hollywood meets Wall Street, and the bidding war is just getting started.

Tesla’s Margin Call

Tesla (NASDAQ: TSLA) beat revenue expectations this quarter… but that’s where the good news ended.

Operating profit plunged 40% year-on-year, marking the fourth consecutive quarter of profit misses. Shares dropped almost 5% in extended trading as analysts raised fresh concerns about the company’s compressed margins and the long road ahead for its autonomous vehicle ambitions.

📉 Sales up, margins down

Tesla’s Q3 revenue climbed 12% to US$28.01 billion above analyst forecasts. Deliveries hit record highs, partly driven by a surge in U.S. orders ahead of the expiry of key EV tax credits.

But profits didn’t follow. Operating income fell to US$1.62 billion, while EPS came in at US$0.50, missing expectations of US$0.54. Margins were weighed down by a sharp rise in operating costs, lower regulatory credit revenue and over US$400 million in tariffs on imported auto parts – fallout from renewed U.S. trade measures under President Trump.

To stay competitive, Tesla also slashed prices across its Model Y and Model 3 line-up, releasing cheaper “Standard” variants costing up to US$5,500 less than their premium counterparts.

🛻 Robotaxi rollout hits the brakes

Tesla is still betting big on autonomy but it’s proceeding with extreme caution. The company launched early Robotaxi trials in Austin and the Bay Area, but they still require human drivers. Elon Musk told investors Tesla is targeting 8–10 metro areas for further tests by year-end, including Florida, Arizona and Nevada.

The rollout is deliberately slow. Musk cited regulatory risk and media scrutiny as reasons for the careful pace. Analysts say the full autonomy story is central to Tesla’s long-term valuation, but right now, it’s not doing much for earnings.

💡 The valuation dilemma

Tesla’s market cap remains the highest among automakers at US$1.47 trillion. But with a stock trading at 200x profit expectations, investors are looking for faster delivery on the futuristic promises that underpin its lofty valuation.

And while the stock is up 9% year-to-date, it remains one of the weaker performers among the so-called “Magnificent Seven” tech stocks. Margin pressure and EV market headwinds may continue to weigh on Tesla until either Robotaxi revenue ramps or margins start to recover.

🔦  Some other things we’re shining the Spotlight on:

ZIP SURGES ON RECORD CASH EARNINGS: Zip Co (ASX: ZIP) posted record quarterly cash earnings of A$62.8 million, up 98% year-on-year, driven by surging U.S. demand. Total transaction volume rose nearly 39% to A$3.9 billion, with U.S. revenue jumping 51% to A$214 million. The BNPL player is also eyeing a Nasdaq dual listing.

BEYOND MEAT GETS FRIED: Beyond Meat (NASDAQ: BYND) had a wild ride, surging more than 1000% over four days as the  meme-stock crowd piled in. Not bad for a company that had seen its share price all but wiped out prior to the surge.

T-REX TAKES OFF (AGAIN): After collapsing into administration last year, Rex Airlines is staging a comeback. U.S. aviation group Air T is acquiring the regional carrier and plans to keep flying its 30-year-old Saab fleet for another 10–15 years. Half of Rex’s planes are currently grounded, but repairs are underway.

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