merger

Elon Musk has said he likes the idea of a merger of Tesla and SpaceX, two of his most notable companies, and it is under active consideration.

“Do I think it would be a good idea? Yes,” Musk said during a call with financial analysts over the quarterly business results of SpaceX on Tuesday.

While Musk noted the certainty of such a merger should not be assumed, and it would need shareholders’ support, he said special committees within both companies have been formed to examine the move.

“The special committees have not reached agreement on terms of any transaction and there’s no guarantee that they will,” Musk added. “But I do think there is a lot of merit to merging and a lot to be gained.”

With Tesla valued roughly $1.5 trillion and SpaceX valued at $2 trillion, a combination of the two companies would mark one of the largest mergers in history.

Shares of SpaceX rose 8% in after hours trading.

The company, which builds space rockets and Starlink internet satellites, is now expanding into offering cloud compute capacity for other tech companies, like Anthropic and Google.

That line of business has become the most profitable part of SpaceX, bringing in $7.5bn according to the latest quarterly results. Starlink also tallied revenue of $5.2bn.

SpaceX as a whole, however, is not profitable and has lost $1.1bn so far this year.

Shares of Tesla, which reports its own quarterly results on Wednesday, rose 2% after being down slightly for weeks.

Over the last year, Musk has taken to bringing more of his various companies under fewer banners. Before it went public earlier this year, SpaceX acquired xAI and X, the platform formerly known as Twitter, both of which Musk owned.

The recent launch of Terafab, a combined effort to manufacture computer chips between Tesla and SpaceX, was another signal that Musk sees his companies as potentially more effective when working together.

Musk said on Tuesday a full merger between the two companies would make sense for the work each is doing around chips, artificial intelligence, software and more.

Exactly a week after the new Skydance corporation — the product of the Paramount-Warner Bros. Discovery merger — was officially formed, Hollywood’s newest media giant is already raising streaming prices.

Discovery+, one of Skydance’s new streaming assets, will now cost $6.99 a month for its ad-supported tier, up $1. Its ad-free tier is also up $2, costing viewers $11.99 a month. The prices take effect immediately for new subscribers. Existing subscribers will get 30 days’ notice and see the higher rates on bills dated on or after Nov. 12.

Skydance did not immediately respond to a request for comment.

The platform first launched in 2021, at $4.99 a month for its ad-supported tier and $6.99 for ad-free. Nearly six years later, the price of the cheapest tier has risen roughly 40%, and the ad-free tier has jumped about 72%. This is the service’s second price hike since January 2025.

The standalone streaming service features tens of thousands of TV episodes from cable networks like HGTV, Food Network and TLC.

Before the merger, each company maintained its own streaming services, with HBO Max and Discovery+ under Warner Bros. Discovery and Paramount+ under Paramount Skydance. The services are currently operating as separate entities. But David Ellison, Skydance’s chairman and chief executive, has said he plans to merge the two platforms into one streaming service. It’s unclear when that might happen, what it would cost, or where Discovery+ fits in. The company has not publicly laid out plans for the service.

Prices for HBO Max currently range between $10.99 and $22.99 monthly. Paramount+ costs between $8.99 and $13.99 a month.

Streaming is one of the biggest open questions for Skydance as it enters a new era. The company is carrying roughly $80 billion in debt and is targeting more than $6 billion in cost savings over three years. Skydance has said those savings will come primarily from technology, procurement, marketing and real estate, and Ellison has said the bulk won’t come from layoffs. Industry observers expect that debt load to add pressure for more price increases across Skydance’s streaming lineup.

This price increase also comes at a time when many streaming platforms are similarly hiking their prices — in part to cover the rising cost of programming and talent. Discovery+ joins platforms like Netflix, Apple TV, Hulu and Disney+ which have all raised their subscription fees in the last year. Prime Video raised the cost of its ad-free add-on in April.

Tech scion David Ellison spent three years doggedly pursuing his dream: acquiring Paramount, then Warner Bros. Discovery.

Ellison pulled off his bold feat this week by completing Paramount’s $111-billion takeover of Warner Bros., uniting two industry pioneers and a wealth of cherished properties — Batman, Bugs Bunny, Harry Potter and Maverick of “Top Gun,” as well as CBS, HBO, Comedy Central and CNN. All will be tucked under a corporate umbrella that Ellison is calling Skydance — the name of the studio he formed two decades ago.

The mogul and his lieutenants celebrated their victory in style, ringing the New York Stock Exchange opening bell on Thursday, capping a bruising battle to secure approval of a deal that had sparked protests across Hollywood over fears of looming job cuts.

Ellison and his team must braid together two huge film studios (housing nine film labels), four streaming services, three TV production studios, three animation units and more than 50 television networks, including two prominent news organizations. That could be a daunting task, particularly based on how previous Hollywood mergers have fared.

“Now, the real work begins,” David G. Fubini, a Harvard Business School senior lecturer, said in an interview.

Anxieties were evident Tuesday — the day the deal closed — when Ellison held a town hall meeting at Warner Bros., which drew nearly 500 employees.

During the session, CNN’s Anderson Cooper quizzed his new bosses, including about anticipated layoffs and news independence.

“Do you stand with CNN and our effort to completely restore access to covering President Trump?” Cooper asked, referring to CNN’s legal fight alongside MS Now and Politico to reverse the president’s ban on the three organizations.

“Of course,” Ellison replied.

CNN news anchor Anderson Cooper, pictured here in 2021, quizzed his bosses at a Burbank town hall.

(Evan Agostini / Invision / Associated Press)

Hours later, Ellison parried with reporters in Paramount’s darkened Stage 3, recently revamped with laser projection capabilities to simulate fantastical and far-flung settings for TV shows, such as the streets of New York.

“This was a turbulent process, and, at times, a really ugly process, to actually get this deal over the finish line,” Ellison acknowledged to reporters. “What I want to be able to do now is turn the page, and actually make sure that we are in the business of rebuilding trust.”

To do that, Ellison intends to make more movies and TV shows than rivals. He wants to ensure the Warner Bros. and Paramount studios, which will be kept separate for now, remain talent-friendly destinations.

Ellison has taken an opposing view from his predecessors who confronted crumbling industry economics by cutting expenditures to boost their corporate bottom lines.

The 43-year-old executive, son of Oracle co-founder Larry Ellison, proudly views his family as “owner-operators,” unshackled by quarterly earnings expectations or the need to dole out dividends to keep investors happy. The Ellison family controls the company’s voting stock, allowing David Ellison to take a long-term view as he charts Skydance’s course.

The goal is to “win in storytelling,” Skydance said in an investor presentation. It intends to build the media industry’s most “technologically capable” firm, which uses artificial intelligence to speed work flows. Skydance plans to spend at least $30 billion a year on film, television and video game content.

Skydance co-CEO Ynon Kreiz, Sarah Ellison, CEO David Ellison and investor Gerry Cardinale of RedBird Capital Partners on the floor of the New York Stock Exchange on Thursday.

(Yuki Iwamura / Associated Press)

The realities of Ellison’s big swing will soon sink in as he and his team turn their focus to integrating the myriad operations and about 55,000 employees.

In some ways, Ellison is behind the curve.

Most major mergers are consummated after executives have dedicated months to quietly drafting detailed operational plans and organizational hierarchies. Ellison, in contrast, has spent the last nine months in a pitched battle for Warner Bros. — ultimately vanquishing Netflix, hundreds of vocal merger opponents, and California Atty. Gen. Rob Bonta and his coalition of 11 other state attorneys general who filed an antitrust lawsuit in July in an attempt to derail the deal.

Ellison and Bonta resolved their legal fight Sept. 21. A week later, a federal judge cleared the way for the merger to close.

The lawsuit settlement with Bonta requires that the combined company produce at least 30 movies a year for five years. It also must maintain the studio facilities in Los Angeles, making “reasonable efforts to operate the lots in a manner consistent with past practices,” according to the agreement.

Skydance has committed to maintaining operations on the Warner Bros. lot, pictured here, and at Paramount Pictures in Hollywood.

(Eric Thayer / Los Angeles Times)

Ynon Kreiz, former chief executive of Mattel toys in El Segundo, has been tasked with leading the integration. The 61-year-old executive joined Ellison at Skydance as his co-CEO earlier this week. Day One of the combined company marked Kreiz’s second day on the job.

“They have a whole new management team that will be expected to immediately lead this massive integration,” Fubini, a former partner at consulting firm McKinsey, said. “The clouds have cleared, and they are at the base camp of Mt. Everest facing this enormous undertaking.”

In a report this week, TD Cowen Global Research maintained its “hold” rating on the newly constituted Skydance, expressing some doubts about Ellison and his team’s ability to “avoid integration and execution problems that have bedeviled other major media mergers.”

Hollywood has had a history of failed mergers, including Discovery’s 2022 takeover of WarnerMedia from AT&T, which led to years of cost cuts that ultimately seeded the ground for Ellison’s takeover. AT&T’s purchase of the same assets in 2018 also quickly unraveled, some 20 years after the epic failure of AOL Time Warner.

Ellison now must grapple with the hefty acquisition costs for Warner Bros., which climbed as the deal was delayed. The company emerged from the transaction with $86.8 billion in total debt; with most of that going toward buying out Warner Bros. Discovery’s stockholders at $31.17 a share.

The debt burden also includes more than $18 billion in obligations leftover from past mergers. Skydance has nearly $7 billion in cash on hand.

Oracle’s Larry Ellison and executive producer David Ellison arrive at the L.A. premiere of “Star Trek Into Darkness” at the Dolby Theatre in 2013.

(Eric Charbonneau / Getty Images for the Hollywood Reporter)

The Ellison family brought in foreign investors, including royal families of Saudi Arabia, Qatar and Abu Dhabi as passive owners, to contribute equity to the deal. Gerald Cardinale’s RedBird Capital Partners, a longtime Skydance stakeholder, added $4 billion, bringing its total investment in Skydance deals to $6 billion.

The deal’s financial terms pose deep challenges, analysts said. Fitch Ratings this week downgraded Skydance credit, citing “materially higher leverage after the acquisition and significant execution and integration risks,” according to its report.

“Interest rate increases made financing this transaction far more expensive than anyone anticipated,” said Eric Talley, a professor at Columbia Law School. “Those lenders are going to start expecting their interest payments — Skydance executives won’t have the luxury of time.”

The company could struggle, Talley said, to “generate the cash flow needed to easily service that debt unless they can significantly cut costs.”

Skydance has promised investors that it will make $6 billion in cost cuts over three years. It anticipates $2 billion in reductions within a year, with the bulk of the rest occurring in the second year of the merger.

“They are going to be firing a lot of people,” TD Cowen Global Research media analyst Doug Creutz said.

During the press briefing, Kreiz sought to downplay the expected workforce toll, saying Skydance would achieve savings by combining technologies that support streaming services and marketing expenditures. It plans to save costs on real estate by locating employees at Skydance-owned properties in Santa Monica, Hollywood and Burbank.

HBO could move from Ivy Station in Culver City, its home for the last five years, to one of the studio lots.

Ellison and Kreiz said they would jointly manage the new colossus.

“Where David will focus on creative, technology, long-term strategy, including especially as it relates to the creative part of the business, I will focus more on the operations and the day-to-day management of the business,” Kreiz said.

Kreiz was named to Skydance‘s expanded board this week along with Laurene Powell Jobs, founder of the Emerson Collective; and Bobby Kotick, former CEO of Activision.

The new leaders expressed confidence they could expand and integrate their two major streaming services to drive growth. HBO Max and Paramount+ combined will reach more than 200 million subscribers.

The plan, they said, is to combine the two streamers within a couple of years, but the company may offer subscribers a bundle with the two offerings sooner.

Skydance, according to sources, also expects to bolster its free, ad-supported service Pluto TV, which offers more than 200 channels. The service hasn’t had much corporate attention in recent years amid the cuts and deal-making.

The executives have not disclosed which teams would soon be affected or how they will structure overlapping business units.

For example, the company’s three TV studios each have their own leader: Channing Dungey runs the largest, Warner Bros. Television; David Stapf has long managed CBS Studios; and Skydance executive Matt Thunell has been president of Paramount Television Studios since last year.

Integrating CNN and CBS

Anxiety over whether CNN and CBS News would be mashed together was quelled, at least for now.

Skydance announced that it was retaining CNN Worldwide Chairman Mark Thompson as head of the larger news organization. CNN journalists had worried that CBS News Editor in Chief Bari Weiss, who has presided over a year of turmoil at the network, would be put in charge of both.

Any news consolidation could take years, in part, because CBS News is largely unionized while CNN is a non-union shop.

“We are going to spend the next several months basically getting under the hood,” Ellison said.

CBS News Editor in Chief Bari Weiss, pictured here in 2023 in Los Angeles, has had a turbulent tenure at CBS.

(Francine Orr / Los Angeles Times)

Another challenge will be stabilizing the Warner Bros. film unit, which has had a rough year at the box office. This month, the top two Warner Bros. film executives, Mike DeLuca and Pam Abdy, exited abruptly, clearing the way for longtime Ellison lieutenants Dana Goldberg and Josh Greenstein to oversee both film studios. The co-heads of DC Comics, James Gunn and Peter Safran, segued to the new Skydance.

Skydance also will have to deal with the NFL, which could demand substantially higher fees for CBS to keep its Sunday games.

The current contract allows the league to reopen negotiations because of the ownership change. Skydance is hoping it can wait three years until the contracts of other broadcasters also are up for discussion.

Skydance will be a major player in sports. Last year, Paramount agreed to spend $7.7 billion for UFC fights. The combined company also has rights to professional golf, including the Masters tournament; National Hockey League; Major League Baseball and NCAA basketball, including March Madness, as well as European rights to televise the Olympics.

“Until you actually get inside the company, there are things you won’t know,” Creutz said. “But they are going to have to come up with answers pretty quick.”

Paramount Skydance has completed its takeover of Warner Bros Discovery, bringing CNN and CBS News under the same corporate ownership, in a deal that has raised concerns about editorial independence and freedom of speech.

The acquisition, worth about $110bn including debt, combines two of Hollywood’s biggest studios after months of legal challenges lodged by state attorneys general and unions.

The new company, Skydance Corporation, brings together HBO, CBS, Nickelodeon, Showtime, Comedy Central, DC Studios and Food Network, alongside streaming services Paramount plus and HBO Max.

But its control of two major US news organisations has drawn particular scrutiny. David Ellison, Skydance’s chairman and chief executive, has promised to preserve their editorial independence, but his father, Oracle cofounder Larry Ellison is a major financial backer of the deal, and has previously donated funds to US President Donald Trump and Israel.

Asked about the takeover on Tuesday, Trump welcomed it. “They’re terrific people, and it’s going to be a great company,” he said.

Why was the merger challenged?

The takeover faced initial opposition from Hollywood workers, politicians and state prosecutors concerned about the mounting concentration of power in an industry already dominated by a handful of companies.

Netflix initially reached an agreement to buy part of Warner Bros Discovery. Paramount then launched a competing bid, prompting a bidding war before Netflix walked away.

A California-led coalition of 12 state attorneys general sued to block the deal, saying that it would reduce competition and raise prices. The Writers Guild of America brought a separate challenge.

Both cases were settled in September when Paramount agreed to commitments relating to film production, support for displaced workers and protections for the news networks, including the creation of a new editorial independence board.

But the settlement did not end opposition to the deal. “This merger will stifle creativity, weaken free speech and cost people their jobs,” actor and activist Mark Ruffalo has said.

Democratic Senator Elizabeth Warren linked the takeover to Trump’s efforts to restrict media access. “As Trump tries to ban CNN from the White House, it would be a massive mistake to cave on the Paramount merger,” she said, referring to the US president’s so-far thwarted attempt last month to bar reporters from several news organisations, including CNN, from accessing the White House.

Can an editorial independence board protect CNN and CBS?

One condition of the settlement requires Skydance to establish a “News Editorial Independence Board” within 180 days of completing the takeover.

The five-member body is to include active or retired journalists with at least 10 years of experience. It is intended to establish editorial principles and address disputes involving the news networks and corporate management.

However, its members will be appointed by, and will report to, Skydance’s board of directors, which Ellison chairs. Two members can belong to the same political party, and there is no requirement to publish its findings.

The condition has left critics with a multitude of questions, including: How can a member of an independent editorial board be a member of a political party? How can there be scrutiny if its findings are not public? How can it be independent if it is appointed by a board of directors, themselves appointed by the CEO of the company?

Seth Stern, chief of advocacy at the Freedom of the Press Foundation, said, “A Paramount-appointed editorial independence board for CNN and CBS is worthless. The fish rots from the head, and this particular fish is headed by a compromised oligarch with a history of throwing journalists under the bus to advance his business interests.”

Stern also questioned whether government enforcement of the settlement could itself threaten press freedom. “The editorial board creates the same First Amendment problems it’s supposed to solve – the government meddling in the news.”

The First Amendment provides constitutional protection for freedom of speech and the press.

Ellison argues that the two networks will continue to operate independently. “We’re going to make sure that CNN and CBS News are completely editorially independent,” he said on Tuesday.

On Monday, Skydance announced that Mark Thompson would remain CNN’s chairman and editor-in-chief, while Bari Weiss will continue as CBS News’s editor-in-chief, easing previous fears that Weiss would immediately take charge of both networks.

Why are there fears for editorial independence?

The takeover gives the Ellison family control of CNN less than a month before the November 3 US midterm elections, and follows Trump’s repeated attacks on the network as it seeks to hold the US president to account.

Shortly after Paramount launched its bid in December, Trump accused CNN of spreading “poison and lies” and said it was “imperative” that it be sold, while the Trump administration has moved to bar CNN from reporting in certain areas of the White House.

Ellison donated roughly $45m to a political nonprofit group supporting Trump’s election efforts in 2024, while he donated $16.6m to Friends of the Israel Defense Forces, a charity supporting Israeli soldiers – its largest single donation at the time.

Earlier this year, the White House criticised CNN’s coverage of the US-Israeli war on Iran, while Defence Secretary Pete Hegseth told reporters that “the sooner David Ellison takes over that network, the better.”

Sovereign wealth funds from Saudi Arabia, Qatar and the United Arab Emirates also hold indirect financial interests in the combined company. They have no voting stakes, although their involvement adds another layer of scrutiny over its funding.

Concerns about the future for editorial integrity, however, intensified after Skydance acquired Paramount in 2025, and layoffs followed, alongside the closure of CBS News Radio and changes to CBS News flagship investigative programme 60 Minutes.

High-profile firings enacted under CBS News Editor-in-Chief Bari Weiss and Skydance Media CEO David Ellison included correspondents Sharyn Alfonsi and Cecilia Vega, as well as 60 Minutes executive producer Tanya Simon.

The programme’s September season premiere attracted about 21 percent fewer viewers than a year earlier.

In 2025, Paramount also agreed to pay Trump $16m to settle a lawsuit over the editing of a 60 Minutes interview with then-presidential candidate Kamala Harris.

In a June 2 letter, nine advocacy groups, including Reporters Without Borders, the Freedom of the Press Foundation and the Committee for the First Amendment, warned that CNN could face similar upheaval and firings.

“Bari Weiss’ shameless actions fulfil the Ellisons’ commitment to President Trump to remake CBS to his liking,” they alleged, referring to the firings and changes at 60 Minutes.

“Larry Ellison has reportedly promised to do the same at CNN if allowed to take control through the pending Paramount-Warner Bros. Discovery merger. Not because it makes any business sense, but because they seek to control the public discourse.”

The groups described the proposed takeover as an “existential threat to the free press, independent media, and free speech in this country and beyond”.