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| Hello Insiders! Today's business newsletter covers: - ✍️ Hollywood writer's strike continues.
- 📉 Gap misses revenue estimates and reports sales decline.
- 🏦 Wells Fargo set to pay for $35M penalty for overcharging customers with advisory fees.
If you find this newsletter useful, please share it with your friends and colleagues. Thank you. Arbër
p/Arber | |
| 1 | | The Screenwriters Guild of America has stated that the latest offer from major Hollywood doesn't fulfill their demands regarding the use of AI and access to viewership data. The strike has been ongoing since May 2, 2023. More: - Writers have said that while the studios have partially accepted their demands regarding the use of AI, they are not budging when it comes to changing rules on how the writers' work could be used to teach AI software to write scripts on its own.
- Regarding the second major condition, which is access to viewership data, the studios have said they would allow six guild staff members limited access to data on streaming viewership but are refusing to tell writers how many viewers their shows have and to base their payment on those views.
- The writers resumed talks on Aug. 11 with the Alliance of Motion Picture & Television Producers, representing employers such as Walt Disney Co. and Netflix Inc.
- The alliance said on Tuesday that it has proposed the guild that includes the highest wage increase in 35 years.
Question: Do you think Hollywood's major studios will fulfill the demands presented by the Writers Guild of America? Join the conversation here. |     | |
| 2 | | 
What happened: Gap has missed revenue estimations and reported a decline in Q2 sales across all of its brands. The company failed to reach the net sales figure from 2021, showing that consumer spending has decreased post-COVID-19. More details: Gap had $3.55B in revenue, while Wall Street analysts had estimated that it would report $3.77B in revenue. The company's net income for the quarter was $117M compared to a loss of $49M in 2022. Net sales dropped 8% to $3.55B, compared with $3.86B in 2022. Gap saw sales drop across all its brands: Athleta's revenue was down 1% YoY, Old Navy saw its sales fall 6%, and Banana Republic had an 11% decline. On a more positive note, the company saw its profit margin rise to 37.6% after cutting costs last year. Why it matters: Retail companies have attempted to improve their sales through rebranding and focusing on their online presence, as the COVID-19 pandemic lockdowns diminished physical sales. The fact that Gap is struggling with both physical and digital stores shows that the company may have challenging times ahead of itself in a post-COVID-19 world. | | | |
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| 3 | | Wells Fargo has agreed to pay a $35M civil penalty for overcharging customers with advisory fees. The company is being charged by the SEC. More: - According to the SEC, Walls Fargo overcharged over 10,900 advisory accounts with $26.8M in advisory fees.
- These fees affected accounts that were opened before 2014 and were active through December 2022.
- The SEC stated that Wells Fargo settled without admitting or denying the charges.
- Wells Fargo paid affected account holders about $40M, including interest, to reimburse them for the overcharging.
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| 4 | | Sony has acquired headphone maker Audeze for an undisclosed amount. Audeze, known for specializing in spatial audio products, will continue to operate independently. More: - According to the terms reached between the companies, Audeze will continue to manufacture products for other platforms while being a part of the PlayStation ecosystem.
- Audeze sells specialized headphones with built-in spatial audio capabilities for both PlayStation and Xbox players.
- Company representatives said this acquisition deal will enable Audeze to sell its products to a wider range of customers.
- Audeze is based in Santa Clara, California.
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| 5 | | OnlyFans reported an increase in revenue and profit, as company CEO Leonid Radvinsky received $338M in dividends. Payments in the platform in 2022 reached $5.6B, up from $4.8B in 2021. More: - Fenix International, the parent company of OnlyFans, said that the company's annual revenue for the financial year ending in November 2022 grew 17% YoY, reaching $1B.
- Pre-tax profits for the company rose to $525M, up from $432M.
- The group's after-tax profit increased about 24%, going from $325M in 2021 to $404M in 2022.
- The total number of creators on the platform rose to 3.2 million, a 47% increase from 2021.
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| 6 | | Grocery delivery company Zepto has raised a $200M Series E funding round. The startup is now valued at $1.4B. More: - Zepto is an instant delivery company that delivers items such as groceries and electronic gadgets.
- The company averages 300,000 orders per day, managing to grow its sales 300% YoY and reaching $700M in ARR.
- StepStone Group led the funding round, with participation from Goodwater Capital, Nexus Venture Partners, and Glade Brook Capital.
- Since its inception, the company has raised around $560M.
- Zepto is based in India.
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- Modular, a company that provides AI development tools for enterprises, closed a $100M funding round led by General Catalyst, with participation from GV, SV Angel, Greylock, and Factory.
- Realty Income Corporation is investing $950M to acquire a 21.9% stake in the Bellagio Hotel in Las Vegas. The deal will value Bellagio's assets at $5.1B.
- The Ifo business climate index in Germany has dropped to 85.7, as the country's export numbers are showing little growth.
- Spirit Airlines will pay $8.25M to settle a lawsuit filed by customers who said that the company charged them with surprise carry-on bag fees.
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INSIDE BUSINESS LEADERBOARD (30 DAYS) |
 | Writer | | Arbër is an Inside writer who also has experience in entrepreneurship. He has experience covering Consumer Tech, Venture Capital, NFTs, Crypto, etc. Arbër holds a Bachelor's degree in Business from XAMK University in Finland. When he is not reading(and writing) business news, he chooses to watch sports or anime...and then read news about sports or anime. | | This newsletter was edited by Aaron Crutchfield | |
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