Disney CEO Bob Chapek has told division leads in a letter that the company is implementing cost cutting measures in part to help it "achieve the important goal of reaching profitability for Disney+ in fiscal 2024." Based on the internal memo obtained by CNBC, Disney is planning to limit additions to its workforce through a targeted hiring freeze. It will still welcome new people for the "most critical, business-driving positions," but all other roles are on hold for now. Chapek has also admitted in his letter that Disney "anticipate[s] some staff reductions" as it looks at all aspects of its business to find places where it can save money. 

Chapek's letter comes after Disney reported less-than-stellar earnings for the previous quarter. While Disney+ welcomed 12.1 million new subscribers for the company's fourth fiscal quarter ending on October 1st, the company's operating loss for streaming jumped from $0.8 billion to $1.5 billion. The company expects its losses to taper off going forward, thanks to its streaming services' price hikes and the launch of an ad-supported tier on Disney+. In his memo, Chapek also reiterated he is "confident in [the company's] ability to reach the targets [it has] set," but Disney clearly intends to tighten its belt until it hits its goals.

Disney is but one of the many companies imposing a hiring freeze due to the economic downturn. When Meta chief Mark Zuckerberg announced that the Facebook parent company is laying off 11,000 employees, he also said that it's extending its hiring freeze through the first quarter of 2023. Amazon froze hiring at its corporate offices earlier this month, as well. 

Twitter isn’t the only notable tech company to bandy around the word “bankruptcy” this week. After a stunningly rapid collapse, crypto exchange FTX has filed for Chapter 11 bankruptcy protection, while founder Sam Bankman-Fried has resigned as CEO.

The bankruptcy filing covers FTX Trading, FTX US, Alameda Research and around 130 other companies under the umbrella of the FTX Group, according to a press release. Some others, such as FTX Australia and FTX Express Pay, are not involved in the bankruptcy proceedings. Filing for Chapter 11 bankruptcy doesn't necessarily mean that a company is dead in the water — it allows a business to keep trading while it figures out a plan to pay back creditors. However, it's a tough position to come back from.

"The immediate relief of Chapter 11 is to provide the FTX Group the opportunity to assess its situation and develop a process to maximize recoveries for stakeholders," new CEO John J. Ray III (a former Enron chairman who came in to oversee that company's liquidation) said in a statement. "The FTX Group has valuable assets that can only be administered in an organized, joint process. I want to [assure] every employee, customer, creditor, contract party, stockholder, investor, governmental authority and other stakeholder that we are going to conduct this effort with diligence, thoroughness and transparency." Ray suggested that stakeholders should remain patient, noting that "events have been fast-moving and the new team is engaged only recently."

The company swiftly found itself in dire straits after the price of its native FTT token nosedived and many users withdrew their cryptocurrency. Following reports that FTX was facing a liquidity crisis, Changpeng Zhao, the CEO of rival crypto giant Binance, said his company would sell off around $529 million worth of FTT. That all but wiped out the token's value.

Binance then agreed to bail out FTX by taking over the company. However, it backed out of the deal a day later, citing concerns that emerged while conducting due diligence. Bankman-Fried went on to apologize for the mess and said on Thursday he was doing everything he could to raise funds and do "right by users." He stepped down just a day later. 

"This doesn't necessarily have to mean the end for the companies or their ability to provide value and funds to their customers chiefly, and can be consistent with other routes," Bankman-Fried wrote on Twitter after the bankruptcy filing. "I'm going to work on giving clarity on where things are in terms of user recovery ASAP." Bankman-Fried added that he will soon publish a more complete, play-by-play account of what happened to FTX.

Meanwhile, reports have suggested that the Department of Justice and Securities and Exchange Commission are investigating FTX. It's not clear when the DOJ started looking into the company's dealings, but the SEC’s investigation has reportedly been ongoing for several months.

FTX won’t be rescued by its biggest rival. One day after announcing a proposed deal to buy the cryptocurrency exchange, Binance said it didn’t like what it found in the company’s books. “As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX,” Binance tweeted on Wednesday afternoon. “Our hope was to be able to support FTX’s customers to provide liquidity, but the issues are beyond our control or ability to help.”

The abandoned takeover bid caps off a tumultuous week for FTX. On November 2nd, Coinbasepublished a report that revealed that the cryptocurrency exchange was facing a liquidity crisis. In response to the article, Binance CEO Changpeng Zhao announced that the company would sell about $529 million worth of FTX’s FTT token, a move that wiped out the value of the cryptocurrency and launched a public spat between the competing exchanges.

Even when the acquisition was first announced, the likelihood of it moving forward seemed uncertain at best, with Zhao stressing at the time that the deal was non-binding. “This is a highly dynamic situation, and we are assessing the situation in real time. Binance has the discretion to pull out from the deal at any time.” he said on Tuesday. By the following morning, The Wall Street Journal and Coinbase came out with separate reports claiming Binance was strongly leaning toward abandoning the rescue.

Less than an hour later, Bloomberg reported that the US Securities and Exchange Commission was investigating FTX to determine if the company had mishandled customer funds. It’s worth noting here that the Department of Justice and SEC are also investigating Binance.

Disney+ has welcomed 12.1 million new subscribers for the company's fourth fiscal quarter ending on October 1st, and according to Yahoo Finance, that's 3 million more than analyst estimates. In all, Walt Disney added 14.6 million subscriptions for Disney+, Hulu and ESPN+, bringing its total number of streaming subscribers so far to around 236 million. While Disney+ alone with its 164 million subscribers have yet to reach Netflix numbers, all three of the company's services combined had amassed members that can rival the streaming giant's. Netflix revealed that it has around 223.09 million subscribers during its latest earnings report in October. 

Despite the impressive growth in subscriber number, Disney's operating loss for streaming increased from $0.8 billion to $1.5 billion for the quarter. Disney+ experienced more losses within the period due to higher production and technology costs, as well as an increase in marketing expenses. There were also no Premier Access releases for the quarter, such as last year's Black Widow and Jungle Cruise. That said, the losses were offset in part by higher subscription costs, which will become even higher in December. 

Walt Disney CEO Bob Chapek said that the company expects its streaming losses to narrow going forward, thanks to its price increases and the launch of an ad-supported tier on Disney+. The company even believes that Disney+ is on track to achieving profitability in the fiscal year of 2024, assuming the lack of a "meaningful shift in the economic climate." If you'll recall, Disney is raising its streaming prices across the board this December, and the ad-supported tier for Disney+ is launching on December 8th for $11 a month. 

Two of the largest crypto exchanges have just announced one of the stranger tech mergers in recent memory (and that's saying something). Binance plans to acquire its rival FTX after a brief but very public dispute. As Bloombergexplains, Binance CEO Changpeng Zhao sold about $529 million in FTX's native token on November 6th in response to "recent revelations that came to light," particularly a CoinDeskreport that FTX was facing a liquidity crisis. That led to FTX chief Sam Bankman-Fried accusing Binance of attacking his company with "false rumors," and maintaining that everything was "fine." By today, however, the two companies had reached a takeover deal while acknowledging that Binance would help resolve a "liquidity crunch" affecting FTX's transactions.

Data suggests FTX may have been in a particularly bad state. In a discussion with TechCrunch, CryptoQuant noted that FTX's net crypto asset holdings plunged 83 percent in just the past two days. That reportedly made withdrawals so difficult that FTX had to introduce stablecoin (crypto pegged to an external value) liquidity to process the moves through the markets or other exchanges. The company's stablecoin reserve has fallen by 93 percent in the past two weeks, and related withdrawals fell to near-zero by early this morning. The trouble prompted an investor "exodus," Bloomberg says.

The deal is non-binding, and the companies will only start conducting due diligence (that is, an appraisal) in the "coming days." If completed, however, the acquisition could shake up the crypto industry by eliminating Binance's main competitor. This won't overcome fears of a sustained crypto market downturn, but may give Binance a US presence it doesn't currently have.

That "if" is important, mind you. FTX's Bankman-Fried has been testifying in Congress, and Binance has reportedly faced investigations from both the US Securities and Exchange Commission as well as the UK's Financial Conduct Authority. The countries are concerned Binance isn't complying with regulations, and (in the US) possibly breaking the law. It's not guaranteed that regulators in either country will be keen on the proposed union, particularly when Binance's US affiliate was banned in 2019.

Nintendo has announced a solid quarter of earnings, with revenue for the quarter at 349.5 million yen ($2.38 billion) and a 118.7 million yen ($809.6 million) operating profit. That's up by 15.9 and 18.5 percent over last year, largely in part due to a weaker yen, sales outside Japan and the launch of Splatoon 3.

The company is less bullish on Switch console sales, however, lowering its forecast from 21 million to 19 million for 2022. However, it doesn't think that will affect earnings much, with revenue forecast to be 50 billion yen higher at 1.65 trillion yen ($11.25 billion) and operating profit remaining the same at 500 billion yen ($3.4 billion). 

Nintendo said that it has seen a gradual improvement in the supply of semiconductors and other components, along with a "recovery trend in hardware manufacturing for the Switch." However, it lowered the forecast based on sales to date, with the weak yen making up the difference in revenue and profit. 

It also detailed what that might mean for consumers who want to buy a Switch for the holidays. "By continually working to front-load production and selecting appropriate transportation methods in preparation for the holiday season, we will work to deliver as many consoles as possible to consumers in every region of the world."

That'll be helped by the launch of a bunch of new games, as well. On top of Splatoon 3, it released Bayonetta 3 in October, Pokémon Scarlet and Pokémon Violet in November, Fire Emblem Engage coming in January 2023, and Kirby’s Return to Dream Land Deluxe arriving in February 2023.

Facebook parent company Meta could announce large-scale layoffs as early as next week, according to The Wall Street Journal. The outlet reports the company is planning to cut “many thousands” of employees, with an announcement coming as soon as Wednesday. Meta currently employs more than 87,000 individuals. The cuts could be the largest workforce reduction conducted by a tech company this year, surpassing the layoffs made by Twitter on Friday. The cuts would also represent the first broad restructuring in Meta’s history.

Meta declined to comment. A spokesperson pointed Engadget to a statement CEO Mark Zuckerberg made during the company’s recent Q3 earnings call. “In 2023, we're going to focus our investments on a small number of high-priority growth areas. So that means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year,” he said. “In aggregate, we expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today.”

As The Journal points out, Meta grew significantly during the first two years of the coronavirus pandemic, adding more than 27,000 employees in 2020 and 2021. The company’s hiring spree continued through the first nine months of 2022, a period during which it brought on an additional 15,344 employees. While the company was a major beneficiary of the pandemic, its fortunes have changed in recent months. In July, the company reported its first-ever revenue drop. The company has blamed its recent hardships on tough competition from TikTok and the release of Apple’s contentious App Tracking Transparency feature.

At the same time, Mark Zuckerberg’s bid on the Metaverse has so far failed to create new revenue opportunities for the company while costing it dearly. Since the start of 2021, Meta has spent $15 billion to make virtual and augmented reality mainstream with little success. The company expects to lose even more money on the project in 2023.

The former executives in charge of MoviePass have been indicted in what the Justice Department calls "a scheme to defraud investors." Ex-MoviePass CEO J. Mitchell Lowe and Theodore Farnsworth, who used to be the chairman of the service's former parent company Helios and Matheson Analytics (HMNY), have been charged with one count of securities fraud and three counts of wire fraud. Federal authorities accuse them of making materially false and misleading claims regarding MoviePass' business in press releases, interviews and even SEC filings in a bid to artificially inflate HMNY's stocks and entice new investors. 

According to the newly unsealed court documents, Farnsworth and Lowe allegedly knew from the start that the business' $9.95 "unlimited" plan was a temporary gimmick to attract new subscribers and, hence, artificially inflate HMNY's stock prices. They also falsely claimed that the business model was tested to be sustainable and that it was possible to become profitable on subscription fees alone, the feds said. 

In addition, the executives allegedly claimed that HMNY had "big data" and AI technologies that could be used to generate revenue for the company by analyzing data collected from MoviePass subscribers. The indictment accuses them of making the claim even though they knew that HMNY did not have the technology or the capability to monetize subscriber data. 

Another allegation against the executives is that they'd made false representations that MoviePass was earning considerable money from multiple revenue streams. The business did not have a non-subscription revenue stream that would make it self-sufficient or offset its losses, according to authorities. Farnsworth and Lowe were also accused of implementing various tactics to prevent certain subscribers from being able to use their "unlimited" service. If you'll recall, MoviePass had to settle with the FTC in 2021 over allegations that it invalidated subscriber passwords on purpose to give it sufficient reason to freeze accounts of frequent users. 

In a statement made to The Verge, the spokesperson for Farnsworth said: "The indictment repeats the same allegations made by the Securities and Exchange Commission in the Commission's recent complaint filed on September 27th against Mr. Farnsworth, concerning matters that were publicly disclosed nearly three years ago and widely reported by the news media. As with the SEC filing, Mr. Farnsworth is confident that the facts will demonstrate that he has acted in good faith, and his legal team intends to contest the allegations in the indictment until his vindication is achieved."

The SEC sued MoviePass for fraud back in September and also accused the executives of misleading investors about the viability of the company's $9.95-per-month business model. Despite its tumultuous past and all the accusations the former people in charge still have to face, MoviePass is back. Stacy Spikes, its original co-founder, purchased it back after HMNY filed for bankruptcy. The service relaunched in September 5th and now charges subscribers $10 a month for up to three movies, $20 a month for up to four and $30 for a maximum of five movies a month. 

As for Farnsworth and Lowe, they're now facing a maximum penalty of 20 years in prison for each count of securities and wire fraud.

Now that Elon Musk owns Twitter, he's officially taking the reins as CEO — for the moment, anyway. Twitter has made an amended filing with the Securities and Exchange Commission indicating that Musk is "the Chief Executive Officer" of the social network. This comes alongside the entrepreneur's moves to dissolve the company board, become sole director and fire many of the company's veteran executives, including former CEO Parag Agrawal. He's clearing house, in other words.

It's not clear how long Musk will remain in the CEO position. He states that his sole director status is "just temporary," but hasn't elaborated. Musk already runs Tesla, SpaceX, The Boring Company and Neuralink, so there's only a limited amount of time to helm yet another firm. Twitter co-founder Jack Dorsey has rolled over his shares (that is, transferred them to the new company), indicating his support for Musk.

Musk has already made or proposed sweeping changes in the first week of owning Twitter. On top of the leadership overhaul, he has reportedly ordered layoffs and unveiled plans for a "moderation council" that will make key content decisions. The new CEO has also floated a number of potential changes, including charging for verification as part of a Blue subscription and even resurrecting Vine.

The management shakeup is poised to be expensive, with The Guardianreporting that it could lead to a minimum $120 million in "golden parachute" exit payments. The figure pales in comparison to what Musk paid to buy Twitter in the first place, though.

In its latest earnings drop, Sony said it sold 3.3 million PlayStation 5s this quarter, matching exactly what it did last year and bringing total units sold since launch to 25 million. Its numbers this quarter are far short of what it needs to hit the 18 million PS5 sales target for fiscal year 2022, though. Sales halfway through the fiscal year (ending March 31st) are now at 5.7 million, which is also nearly the same as 2021 at this point (5.6 million). 

Despite the equal number of PS5s sold, revenue was up significantly over last year (12 percent) to 727 billion yen ($4.92 billion), thanks in part to a PS5 price increase earlier this year. However, profit was down by 49 percent due to the company's recent acquisition of Bungie, along with game developer cost increases. 

Sony sold 11.5 million consoles last year, so it's a good bet that 2022 sales will be about the same . However, a lot depends on holiday sales and whether it can keep production up with demand. That's a problem that has plagued the PS5 since it arrived, due to the pandemic and other issues. In May, Sony said that it will finally be able to ramp up production to meet PS5 demand as supply chain issues ease. While it hasn't given any numbers in that regard, anecdotally it appears that the console has been easier to find in recent months. 

Meanwhile, software sales fell to 62.5 million units from 76.4 million this time last year. Digital downloads accounted for 63 percent of that, up slightly from last year. PlayStation Plus subscriber numbers declined for the second consecutive quarter. 

Sony has revised its revenue projection for next quarter downward to due an expected drop in first-party game sales. However, it's bullish on the next fiscal year, aiming to ship 23 million PS5 units in that time. Interestingly, it also still expects to 18 million units by the end of the fiscal year (March 2023), so it may still have something up its sleeve.