Cable giant Charter Communications and Disney are in a battle over contract fees that has left millions of people without access to U.S. Open, college football and potentially “Monday Night Football,” with the NFL’s season starting in just days.
On Thursday, Disney said that the two companies have been in ongoing negotiations but yet to agree to a new deal. That resulted in Charter’s customers losing access to its networks, including broadcaster ABC and pay-TV channels such as ESPN and FX. Charter and Disney’s stocks were each down more than 2% on Friday.
Charter’s Spectrum TV service has roughly 14.7 million customers across 41 states, with some of its top TV markets being New York, Los Angeles, Dallas-Fort Worth and Atlanta.
These sorts of battles, which can lead to so-called blackouts for pay-TV customers, are common in the industry. But, in the age of streaming, this one is different.
“This is not a typical carriage dispute,” Charter CEO Chris Winfrey said Friday on a call with investors.
Early Friday, Charter executives called the pay-TV ecosystem “broken.” They said they pushed for a revamped deal with Disney that would see Charter cable customers receive access to Disney’s ad-supported streaming services like Disney+ and ESPN+ at no additional cost.
This seemed to be the sticking point as Charter said it accepted Disney’s request for higher fees, although Charter executives didn’t provide specifics on the negotiations as they remain hopeful to get a deal done.
Winfrey noted that in the last five years the entire pay-TV ecosystem has lost nearly 25 million customers, or almost 25% of total industry customers. “It’s staggering,” he said.
Between the high cost of the traditional bundle and the option to switch to more affordable streaming options – most of which are provided by the same companies behind the networks on pay-TV – the speed at which cord-cutting is only accelerating.
Live sports, particularly those shown on ESPN, have long been considered the glue holding the pay-TV bundle together, especially as customers flee for streaming services.
The two companies renewed their contract in 2019, which also included Charter integrating Disney+ and ESPN+, as well as Hulu, into its set-top boxes to give customers more seamless access to those apps, CNBC previously reported.
Charter, which also provides broadband and mobile services but is not in the content business, has said it values its pay-TV business and wants to see it thrive, even if it takes on a different form than the past.
The company took a step toward that earlier this summer when it announced it will offer a sports-lite package – without regional sports networks, but would still include ESPN – to customers at a cheaper rate.
Winfrey said on Friday that was not an option it presented to Disney, although he “would love that,” but believed it was “a stretch too far” for Disney.
Instead, Winfrey said the company sees the option it presented to Disney as a “glidepath” forward to a new business model that keeps the cost of the traditional bundle down for customers who still want it, and puts more eyeballs on Disney’s ad-supported streaming services.
Disney CEO Bob Iger recently said on CNBC that assessing its traditional TV business is at the top of his list, and opened the door to potentially unloading these assets in a sale. The CEO, who returned to the helm late last year, said he realized the company is facing a lot of challenges, many of which are “self-inflicted.”
Iger did note that ESPN is in a different bucket and Disney was instead open to selling a stake in the network while also moving toward a direct-to-consumer streaming service of its live feed.
Still, ESPN Chairman Jimmy Pitaro said at a CNBC event this summer that while this is the future for ESPN, it wouldn’t be in a way that would leave pay-TV distributors behind and nix the traditional pay-TV model that has supported the business for so long.
“The [traditional TV] model has been very good to Disney,” Pitaro said at CNBC x Boardroom’s inaugural Game Plan sports business summit.
Disney said Thursday that it has been able to secure successful deals with other pay-TV companies and is still committed to reaching an agreement with Charter. A Disney spokesperson didn’t immediately respond to a request for further comment Friday.
Google chief executive Sundar Pichai speaks during the tech titan’s annual I/O developers conference on May 14, 2024, in Mountain View, California.
Glenn Chapman | Afp | Getty Images
Google will start using artificial intelligence to determine whether users are age appropriate for its products, the company said Wednesday.
Google announced the new technique for determining users’ ages as part of a blog focused on “New digital protections for kids, teens and parents.” The automation will be used across Google products, including YouTube, a spokesperson confirmed. Google has billions of users across its properties and users designated as under the age of 18 have restrictions to some Google services.
“This year we’ll begin testing a machine learning-based age estimation model in the U.S.,” wrote Jenn Fitzpatrick, SVP of Google’s “Core” Technology team, in the blog post. The Core unit is responsible for building the technical foundation behind the company’s flagship products and for protecting users’ online safety.
“This model helps us estimate whether a user is over or under 18 so that we can apply protections to help provide more age-appropriate experiences,” Fitzpatrick wrote.
The latest AI move also comes as lawmakers pressure online platforms to create more provisions around child safety. The company said it will bring its AI-based age estimations to more countries over time. Meta rolled out similar features that uses AI to determine that someone may be lying about their age in September.
Google, and others within the tech industry, have been ramping their reliance on AI for various tasks and products. Using AI for age-related content represents the latest AI front for Google.
The new initiative by Google’s “Core” team comes despite the company reorganization that unit last year, laying off hundreds of employees and moving some roles to India and Mexico, CNBC reported at the time.
AppLovin shares soared almost 30% in extended trading on Wednesday after the company reported earnings and revenue that sailed past analysts’ estimates and issued better-than-expected guidance.
Here’s how the company performed compared with analysts’ expectations, according to LSEG:
Earnings per share: $1.73 vs. $1.24 expected
Revenue: $1.37 billion vs. $1.26 billion expected
Net income in the quarter more than tripled to $599.2 million, or $1.73 per share, from $172.3 million, or 51 cents per share, a year earlier, the company said in a statement.
Revenue jumped 43% from $953.3 million a year earlier.
AppLovin was the best-performing U.S. tech stock last year, soaring more than 700%, driven by the company’s artificial intelligence-powered advertising system. In 2023, AppLovin released the updated 2.0 version of its ad search engine called AXON, which helps put more targeted ads on the gaming apps the company owns and is also used by studios that license the technology.
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AppLovin’s business has been split between advertising and apps, which is primarily made up of game studios that the company has acquired over the years. With the historic growth in its advertising unit, the apps business has become much less important, and now the company says it is selling it off.
“Today we’re announcing we’ve signed an exclusive term sheet to sell all of our apps business,” CEO Adam Foroughi said on the earnings call.
Later in the call, the company said it has signed a term sheet for the sale for a “total estimated consideration” of $900 million. That includes $500 million in cash, “with the remainder representing a minority equity stake in the combined private company.”
Advertising revenue climbed 73% in the quarter to almost $1 billion. The ad business was previously categorized as Software Platform. The company said it made the change because advertising accounts for “substantially all of the revenue in this segment.”
AppLovin said it expects first-quarter revenue of between $1.36 billion and 1.39 billion, exceeding the $1.32 billion average analyst estimate, according to LSEG. More than $1 billion of that will come from its advertising segment, as the company said it is “still in the early stages” of bolstering its AI models.
“The roadmap ahead is filled with opportunities for iteration,” the company said in its shareholder letter. “As we execute, we believe we can continue to drive value creation for our shareholders.”
Cisco CEO Chuck Robbins speaking on CNBC’s “Squawk Box” outside the World Economic Forum in Davos, Switzerland, on Jan. 22, 2025.
Gerry Miller | CNBC
Cisco shares climbed about 6% in extended trading on Wednesday after the networking hardware maker reported fiscal second-quarter results and guidance that topped Wall Street’s expectations.
Here’s how the company did against LSEG consensus:
Earnings per share: 94 cents adjusted vs. 91 cents expected
Revenue: $13.99 billion vs. $13.87 billion expected
Revenue increased 9% in the quarter, which ended on Jan. 25, from $12.79 billion a year earlier, according to a statement. The growth follows four quarters of revenue declines. The company said it had orders for artificial intelligence infrastructure that exceeded $350 million in the quarter.
Cisco now sees adjusted earnings of $3.68 to $3.74 for the 2025 fiscal year, with $56 billion to $56.5 billion in revenue. Analysts polled by LSEG had been looking for $3.66 in adjusted earnings per share and $55.99 billion in revenue. In November, the forecast was $3.60 to $3.66 in earnings per share and $55.3 billion to $56.3 billion in revenue.
Net income in the latest period slid almost 8% to $2.43 billion, or 61 cents per share, from $2.63 billion, or 65 cents per share, a year ago.
Revenue from the networking division totaled $6.85 billion, down 3% but more than the $6.67 billion consensus among analysts surveyed by StreetAccount.
The security unit contributed $2.11 billion. That is a 117% increase from a year earlier, thanks to the addition of Splunk. Analysts expected $2.01 billion, according to StreetAccount.
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Splunk, which Cisco bought in March 2024 for $27 billion, was accretive to adjusted earnings per share sooner than planned, Scott Herren, Cisco’s finance chief, was quoted as saying in the statement. Cisco’s total revenue would have been down 1% year over year if not for Splunk’s contribution, according to the statement.
Many technology companies have been trying to predict the effects from President Donald Trump’s newly established Department of Government Efficiency. But three-quarters of Cisco’s U.S. federal business comes from the Defense Department, while most of the headcount cutting thus far has occurred in other agencies, Cisco CEO Chuck Robbins said on a conference call with analysts.
“Everything seems to be progressing as we expected,” he said.
Customers do not appear to be pulling up orders before tariffs go into effect, Herren said on the conference call.
As of Thursday’s close, Cisco shares were up 5% so far in 2025, while the S&P 500 index had gained about 3%.