Disney has a magical quarter, Russian hackers pull off the largest known theft of confidential Internet information, and wireless carrier merger gets disconnected. Read about these and more of the day's top business news stories.
Walt Disney: Let it Grow
No need for wishing upon a star; The Walt Disney Co, Tuesday reported its third quarter net income increased 22 percent, topping analysts' expectations, The Associated Press reports. The Burbank, California-based company said net income increased to $2.25 billion from $1.85 billion in the same quarter a year ago. Revenue climbed 7.7 percent to $12.47 billion from $11.58 billion in the same quarter a year ago, topping Wall Street projections. Reported studio entertainment revenue that was up 35 percent over the prior year, reflecting the success of its Oscar-winning animated blockbuster," Frozen" as well as "Thor: The Dark World.” Parks and Resorts revenues for the quarter increased 8 percent to $3.6 billion.
Fox Abandons Time Warner Deal
Twenty-First Century Fox is abandoning its attempt to take over Time Warner in a proposed deal that would have combined two of the world's biggest media companies, The AP reports. 21st Century Fox CEO Rupert Murdoch cited a decline in his New York company's stock price as one of the reasons for ending the pursuit of Time Warner. The announcement Tuesday comes three weeks after Time Warner Inc. revealed that it had rejected 21st Century Fox's unsolicited $76 billion buyout offer. With the proposed deal off the table, 21st Century Fox's board approved a plan to spend $6 billion buying back the company's stock during the next year, AP said,
Sprint and T-Mobile Disconnect Merger Plans
Sprint, the third-largest wireless carrier, and T-Mobile, the fourth largest, are calling off a merger that was reported to be valued at between $31 billion and $50 billion. Spirit is expected to make the announcement Wednesday, USA TODAY reports. The wireless carrier and its parent company, Softbank, decided that regulatory hurdles were too high, The Wall Street Journal reported Tuesday. Sprint could also announce a new CEO to replace Dan Hesse, who took over in 2007, according to reporting by Bloomberg. Last week, French telecom company Illiad made a bid for control of T-Mobile for $15 billion in cash, which may have helped to muddy the deal, analysts say.
Russian Hackers Steal Billion+ Passwords, Email Addresses
A Russian crime ring has pulled off the largest known theft of confidential Internet information, including 1.2 billion username and password combinations and more than 500 million email addresses, USA TODAY reports The cyber gang injected malicious code to steal databases from at least 420,000 websites, according to Alex Holden, founder and chief information security officer for Hold Security in Milwaukee, Wisc. whose own credentials were among the compromised data. The New York Times was first to report the breach Tuesday. Hold Security has been monitoring the Russian cyber gang for about seven months, but only recently realized the magnitude of the gang's operation, Holden said. "The perpetrators are in Russia so not much can be done. These people are outside the law," he said.
President Obama Sends Money Home to Africa (Says NBC Reporter)
In a bid to forge stronger economic ties with Africa, President Barack Obama announced $33 billion in commitments Tuesday The commitments primarily came from private-sector companies, including Coca-Cola and General Electric, underscoring Africa's status as home to six of the world’s fastest-growing economies. China, Europe and India are also moving aggressively to tap into Africa's growing markets. “The United States is determined to be a partner in Africa's success," the president said. "We don't look to Africa simply for its natural resources. We recognize Africa for its greatest resource, which is its people, their talents and their potential." In an instantly viral gaffe, NBC White House Correspondent Chris Jansing. appearing on MSNBC, said there were expectations from the African continent that Obama would do great things for them because of "the fact that (the president) is from Kenya."
Walgreen’s Nixes Inversion, Shares Fall
British news organizations reported Tuesday that Walgreens has decided not to move its headquarters overseas, a move that could save the company billions of dollars in federal taxes in coming years. The stock price for the nation’s largest drug store chain was down 3.56 percent shortly before the market close, The Chicago Tribune reports. . Walgreen’s is expected to soon officially announce that it's completing a $16 billion acquisition of the European drugstore chain Alliance Boots, which operates drug stores in Britain. This would give the company to reduce its tax bill by a projected $4 billion over the next five years by listing the company's headquarters in Switzerland, where Alliance Boots is headquartered. This controversial tactic, known as tax inversion is a loophole that dozens of American companies have used despite years of on-and-off efforts by lawmakers in Washington and the IRS to close it.
Time Inc., Posts $32 Million Loss
In its first quarterly report since spinning off from Time Warner, Time Inc. posted a $32 million loss, compared to $75 million in net income in the same period last year, Folio reports. ??Total revenues for the quarter were $820 million, compared to $833 million in Q2 2013. ??The acquisition of the American Express Publishing brands, and a planned headquarters relocation to downtown Manhattan were among the major impacts on Time Inc.’s earnings.?While Time Inc. reported a 2 percent revenue decline, the drop would have been 7 percent minus the American Express Publishing brands acquisition and the exit from its CNNMoney.com partnership?One bright spot was digital advertising, which surged 12 percent to $74 million for the quarter, about 16 percent of overall ad revenue.