Bob Iger Ousts a Marvel Antagonist

Iger undercuts an internal antagonist

As Disney’s C.E.O., Bob Iger, began a $5.5 billion cost-cutting drive this week, including eliminating some 7,000 jobs, he moved on Wednesday to lay off one of the media giant’s most irascible executives: Ike Perlmutter, the former head of Marvel.

Laying off Mr. Perlmutter, who sold Marvel to Disney for $4 billion in 2009, removes a longstanding source of tension within the media giant — one who had gone so far as to help the activist investor Nelson Peltz fight the board.

Disney eliminated Perlmutter’s fiefdom, Marvel Entertainment, The Times’s Brooks Barnes reports. The small division is separate from Marvel Studios, the powerhouse behind the “Avengers” movies, and focused largely on comics, video game licensing and live-action shows.

Mr. Perlmutter has had a volatile tenure at Disney. His deal to sell Marvel, which he took over in the 1990s, made him a billionaire and one of Disney’s biggest individual shareholders. (The Financial Times estimates that he probably owns 1 percent of Disney; Forbes puts his net worth at about $4 billion.)

But he repeatedly clashed with key executives like Kevin Feige, the chief architect of what’s now known as the Marvel Cinematic Universe. Mr. Perlmutter was notorious for focusing on costs — tales of his desire to skimp on catering at premieres and to cap the budgets of movies like “Doctor Strange” are Hollywood lore — and for opposing Marvel movies that starred Black or female superheroes.

Mr. Iger, Disney’s C.E.O. at the time, eventually stripped Mr. Perlmutter of his oversight of Mr. Feige and Marvel Studios in 2015. “He was not happy about it. And I think that unhappiness exists today,” he told CNBC last month. Four years later, Mr. Iger took away Marvel television shows, leaving Mr. Perlmutter with a rump operation.

That may have been behind Mr. Perlmutter’s decision to help Mr. Peltz, a longtime friend who sought to gain a board seat and shake up Disney. Mr. Perlmutter contacted Disney board members and top executives six times last year to argue for adding Mr. Peltz to the board.

It’s unclear what Mr. Perlmutter, 80, will do next. But Marvel Entertainment will be absorbed into different Disney divisions, and Iger will turn to other business priorities — including a potential cut in Marvel’s film and TV output after disappointing box office results for the most recent “Ant-Man” movie.

• In other Disney news: A plan by Gov. Ron DeSantis of Florida to take control of the board that oversees the area containing Disney World may have been stymied by last-minute legal maneuvering by the media giant.

HERE’S WHAT’S HAPPENING

Russia detains a Wall Street Journal reporter. The authorities in Moscow said that they are holding Evan Gershkovich, an American journalist, on suspicion of espionage on behalf of the United States. The move is likely to escalate tensions between Russia and the U.S.

Washington considers new regulations on lenders. The Biden administration plans to call for new rules governing midsize banks after the failure of Silicon Valley Bank, according to The Wall Street Journal. Meanwhile, Bloomberg reports that the F.D.I.C. is considering a special charge on big banks to replenish its deposit insurance fund, and lawmakers are working on a bipartisan bill to allow compensation clawbacks from bank executives.

Meta reportedly considers a ban on political ads in Europe. Executives at Facebook’s parent company are worried that its platforms won’t be able to comply with pending E.U. regulations about online campaigns, according to The Financial Times. Another factor weighing on executives’ minds: Political advertising brings them relatively little revenue.

Binance is said to have hidden extensive links to China. Internal documents show that the crypto exchange made use of an office in that country until at least the end of 2019 and used a Chinese bank to pay some employees, according to The Financial Times. Binance had said it severed ties to China by 2017.

Adidas drops its trademark fight with Black Lives Matter. Two days after objecting to the advocacy group’s effort to trademark a logo with three stripes, the company withdrew its opposition. Executives feared that the sportswear giant risked being seen as objecting to the broader Black Lives Matter movement, according to Reuters.

Big Tech’s big surge

The Nasdaq 100 Index, a heavyweight collection of technology companies, closed in bull-market territory on Wednesday as investors flooded back into many of the stocks that took a bashing last year.

Large-cap tech stocks have climbed 20.3 percent since the Dec. 28 market close, a surge that technically qualifies as a bull-market rally. Over the same period, the S&P 500 has climbed roughly 6.5 percent.

Tech stocks have rallied despite sector-wide layoffs and the multiheaded threat of a cost-of-living crisis, a banking meltdown, recession fears and the Fed’s campaign to cool inflation by raising interest rates.

The rebound comes after a year to forget. The Nasdaq fell 32.5 percent last year, making it one of the worst performing indexes in 2022. Investors dumped so-called growth stocks, and, in particular, shares in tech firms, as the Fed began aggressively raising borrowing costs.

The 2023 rally is being propelled by multiple tailwinds. The boom in chatbots and artificial intelligence has lifted chip makers like Nvidia, which is up more than 75 percent this year and on pace for its best quarterly performance in more than two decades. Tesla is off to its best start to a year as investors grow more optimistic about the electric vehicle market.

Meta, the social media giant, is trading near a 10-month high. Investors are cheering a pledge by its founder Mark Zuckerberg to cut costs and focus on profit, even though doubts abound about its push into the metaverse. The same playbook is working at Salesforce, which is up more than 45 percent this year even after coming under attack from activist investors.

Wall Street is divided on how long the rally will last. Michael Hartnett, a Bank of America investment strategist, wrote in a recent client note that Big Tech is “winning on rate cut optimism.” The bank has seen net inflows into tech-focused investment funds in each of the past five weeks.

But the rally is deceptively shallow. In an investor note on Wednesday, John Lynch, chief investment officer at Comerica Wealth Management, pointed out that only 12 percent of tech stocks (mainly with large market caps) are trading at three-month highs. That suggests the rally has “a weaker foundation,” he wrote, than previous booms on the Nasdaq.

“For climate change, it’s trillions of dollars a year. For inequality and poverty alleviation and development, it’s trillions a year. … You just have to get the private sector to be a constructive part of the solution.”

— Ajay Banga, the former C.E.O. of Mastercard and President Biden’s nominee to lead the World Bank, on his vision to get companies more involved in tackling the planet’s biggest problems.

Howard Schultz’s tough day in Washington

Starbucks’ former chief executive, Howard Schultz, spent hours on Wednesday being pelted by the Democratic Party that once embraced him. Mr. Schultz, who recently ended his third stint as C.E.O., was grilled by a Senate committee about allegations that the coffee chain illegally blocked workers’ efforts to unionize.

The criticism he faced from Democrats and the committee chair, Bernie Sanders, the independent from Vermont who caucuses with them, highlights the party’s view on labor (and the financial support they get from unions). And investors appear to have treated it as political theater: The company’s shares closed up nearly 2 percent.

Mr. Sanders chided Mr. Schultz for the company’s “calculated and intentional efforts to stall, to stall and to stall” rather than bargain with the union in good faith. Mr. Schultz said the company had met with the union 85 times. Patty Murray, Democrat of Washington (the home state of Starbucks), said constituents had told her about “widespread anti-union efforts.” Mr. Schultz responded that she had in the past repeatedly praised “Starbucks as a model employer.”

The big question hanging over the hearing: Can C.E.O.s be trusted to treat workers fairly? Mr. Schultz was adamant that they can. He pointed to the staff benefits Starbucks provides, including health care, stock grants and paid sick leave. And he noted that the average wage for hourly workers at the company was $17.50, and that total compensation, including benefits, approached $27 an hour. “Respectfully, that’s more than the minimum wage of every senator that’s represented a state on this committee, including Chairman Bernie Sanders.”

About his wealth: “Yes, I have billions of dollars — I earned it,” he said. “No one gave it to me. And I’ve shared it constantly with the people of Starbucks.”

Why UBS gave up on Ralph Hamers

UBS’s decision to bring back its former C.E.O., Sergio Ermotti, after its takeover of Credit Suisse was largely put down to his experience in investment banking and steering the financial giant after the 2008 financial crisis.

One theory is that Swiss authorities preferred a Swiss banker to oversee the deal. Another is that UBS’s board and its chairman, Colm Kelleher, had lost confidence in Ralph Hamers, the Dutch banker who succeeded Mr. Ermotti in 2020, to manage such a big and complicated transaction. According to The Financial Times, Mr. Kelleher had sought to mentor Mr. Hamers, but worries were amplified by Mr. Hamers’s stuttering performance in a call with analysts after the deal was announced last week:

Kelleher initially took Hamers under his wing and attempted to brush up his communications skills. Hamers was banned from using his favorite buzzwords such as “purpose” and “ecosystems” in their weekly meetings together.

The pair set about trying to convince international shareholders to invest and close UBS’s valuation gap on its U.S. peers.

Kelleher had been willing to give Hamers time to prove he was capable of leading the business and carrying out its growth strategy. But when UBS aborted the Wealthfront acquisition in September, questions began to be asked about Hamers’s authority within the bank.

THE SPEED READ

Deals

• Carl Icahn’s latest demand in his proxy battle with the gene-sequencing company Illumina: Bring back the firm’s former C.E.O., Jay Flatley. (WSJ)

• Britain’s competition authority said it would open an antitrust investigation into the chip maker Broadcom’s $61 billion deal for the cloud computing business VMware. (Reuters)

• A potential delay for the I.P.O. of the skin care company Galderma could cost Credit Suisse its role as lead underwriter. (Bloomberg)

Policy

Best of the rest

• Macy’s named Tony Spring, the head of its Bloomingdale’s chain, as its new C.E.O., succeeding Jeff Gennette. (NYT)

• David Zaslav, the C.E.O. of Warner Bros. Discovery, earned roughly $39 million last year — a big drop from 2021. (Variety)

• “Kara Swisher Calls the Shots.” (Vanity Fair)

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