1 big thing: Robinhood's new media company

2. Scoop: Dozens of media companies set Twitter content deals

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3. Twitter's lock on news

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4. Peak TV still peaking

5. 🥊 Disney braces for proxy battle

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6. ⚖️ New algorithm pressure on Big Tech

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7. Streaming comes for embattled award shows

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Situational awareness: Disney’s Avatar sequel "The Way of Water" is closing in on $2 billion in global box office sales, which would clear James Cameron’s self-imposed benchmark to make the film profitable.

The movie would become only the sixth film in history to pass $2 billion in global ticket sales.

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Axios Media Trends

1 big thing: 🗞️ Dozens of groups join coalition to save local news

2. Exclusive: AP to redesign site amid ad revenue push

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3. "Everything Everywhere All at Once" leads 2023 Oscar nominations

4. 🤖 AI comes for news

5. CNET rival: "We will never have an article written by a machine"

6. Newsrooms feel layoff whiplash

7. 🍿 Avatar sequel joins $2B club

8. China reopens its doors to Hollywood

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⚖️ Situational awareness: The Justice Department is expected to imminently sue Google over its digital ad market dominance, Bloomberg News reports. 

It would mark the second major antitrust lawsuit filed against Google by the Justice Department in the last three years. 

1 big thing: News engagement stabilizes

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2. TV's tough 2023 trajectory

3. 🎙️ Exclusive: Don Jr. signs 7-figure podcast deal

4. Punchbowl adds text alerts as outlets seek Twitter alternatives

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5. CES bets on post-pandemic bounce

6. 1 fun thing: Mickey’s legal mousetrap

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🎰 Heading to CES? Reply to this email if you want to grab coffee in Vegas. 

Situational awareness: ESPN's Monday Night Football pros knew last night's game was over long before NFL commissioner Roger Goodell called it, Variety's Cynthia Littleton writes. 

Go deeper: A breakdown of ESPN's live coverage last night.

1 big thing: Ek eyes profits 

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2. Spotify's ad biz grows

3. Scoop: Substack's new "pledge"

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4. NBCU and PointsBet extend deal to 7 years

5. 🔍 DOJ lawsuit targets Google's ad network

6. Changes coming to Paramount

7. Meta's Trump invite hangs a cloud over Truth Social

Today's Media Trends, copy edited by Mickey Meece, is 1,544 words, a 6-minute read. Sign up here.

📅 Thursday at 12:30pm ET: Join me and Axios Pro Media Deals reporter Tim Baysinger for a conversation forecasting media trends in 2023. Register

Axios Media Trends: Spotify CEO's 2023 focus

1 big thing: Digital giants stuck in a buyer's market

2. News job cuts jumped 20% last year

3. Cable companies eye mobile to save the bundle

4. Exclusive: The Intercept spinning off as an independent nonprofit

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5. WWE's board smackdown

6. 1 fun thing: Viral C-SPAN coverage renews calls for rules changes

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Situational awareness: Axios is launching a centralized news hub that will bridge our local and national coverage. Go deeper.

National

Barstool Sports founder Dave Portnoy has dropped his appeal of the dismissal of his 2022 lawsuit against news publisher Insider, according to a filing before the U.S. Court of Appeals for the First Circuit.

Why it matters: The dismissal officially ends a drawn-out defamation battle between the two parties over stories Insider wrote alleging sexual misconduct against Portnoy.

Details: In the filing, lawyers representing Portnoy and Insider said they agreed to dismiss the appeal, as long as each side covers their own legal costs. 

A source familiar with the arrangement said Portnoy's lawyers reached out to Insider's to withdraw the appeal, and Insider's lawyers agreed to mutually notify the appeals court to put an end to the dispute. 

Catch up quick: Insider published the first of two stories alleging sexual misconduct against Portnoy on Nov. 4, 2021.

That story, written by Insider writer Julia Black, cited conversations with "more than two dozen people with direct experience with Portnoy and Barstool, including eight current or former employees."

Portnoy challenged the credibility of the reporting in a response shortly after the story published, arguing the reporter "had an agenda from day one."

Insider published a second story, written by Black and her colleague Melkorka Licea, on Feb. 2, 2022, citing three additional women who said Portnoy filmed them without consent during sex.

Five days later, on Feb. 7, Portnoy sued Insider, its global editor-in-chief Nicholas Carlson, its CEO Henry Blodget, Black and Licea for defamation by libel and invasion of privacy in a U.S. District Court in Massachusetts. 

On Nov. 7, 2022, a district judge in Massachusetts dismissed the lawsuit, arguing Portnoy failed to provide enough evidence that Insider acted with "actual malice," or intentionally disregarding the truth, in publishing its story. Portnoy's lawyers filed an appeal days later.

The judge also dismissed Portnoy's privacy complaint, arguing he has "no reasonable expectation of privacy in the text and social media messages published by Insider."

What they're saying: "Our stories were accurate and fair," Insider said in a statement Thursday. "We are grateful to our reporters Julia Black and Melkorka Licea, and to our sources."

Insider noted that the judge who dismissed Portnoy's case in November underscored that Insider provided substantial evidence in its story. 

"We stand by our reporting," Insider said. 

The big picture: The U.S. standard for defamation sets a very high bar for proving actual malice in defamation cases against public figures.

There have been a number of defamation suits waged against news organizations by high-profile individuals in the past few years, but news companies tend to win out. 

Most notably, Sarah Palin lost her defamation suit against the New York Times last February. 

Dave Portnoy drops appeal over his lawsuit against Insider

The dismissal officially ends a drawn-out defamation battle between the two parties.

Media trends

Media

Barstool Sports founder Dave Portnoy has dropped his appeal of the dismissal of <a class="gtmContentClick" data-vars-link-text="his 2022 lawsuit" data-vars-click-url="https://www.axios.com/2022/03/15/barstool-difference-dave-portnoy-erika-nardini" data-vars-content-id="0e577aae-ef1b-4b9e-8b41-f381817b071d" data-vars-headline="Dave Portnoy drops appeal over his lawsuit against Insider" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.axios.com/2022/03/15/barstool-difference-dave-portnoy-erika-nardini" target="_self">his 2022 lawsuit</a> against news publisher Insider, according to a <a class="gtmContentClick" data-vars-link-text="filing" data-vars-click-url="https://www.documentcloud.org/documents/23596698-2023-01-31-stipulation-of-dismissal-2" data-vars-content-id="0e577aae-ef1b-4b9e-8b41-f381817b071d" data-vars-headline="Dave Portnoy drops appeal over his lawsuit against Insider" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.documentcloud.org/documents/23596698-2023-01-31-stipulation-of-dismissal-2" target="_blank">filing</a> before the U.S. Court of Appeals for the First Circuit.Why it matters: The dismissal officially ends a drawn-out defamation battle between the two parties over stories Insider wrote alleging sexual misconduct against Portnoy.

After a record economic expansion, the coronavirus pandemic sent the U.S. economy into a recession as unemployment soared to staggering heights. The country now faces urgent questions about how much stimulus is needed for reeling consumers and businesses, and what a recovery might look like.

Economy & Business

Shares for Facebook parent Meta jumped more than 17% in after-hours trading Wednesday, after the tech giant beat Wall Street expectations on revenue and user growth. 

Of note: Meta also provided positive first quarter guidance and said it expects expenses for the full year to be lower than originally forecasted. 

Why it matters: Investors no longer expect Meta to grow at the same blockbuster pace that it used to. 

Meta brought in 4% less revenue compared to the same quarter the year prior, but it didn't lose more than investors were expecting, which is partly why Wall Street responded positively to the company's results. 

Meta also announced a $40 billion stock buyback, which shareholders typically welcome.

Driving the news: The company said that, for the first time in December, it reached 2 billion daily active users across its family of apps, which includes Facebook, Instagram and WhatsApp. 

The majority (67%) of its total user base of 2.9 billion uses at least one of its apps daily. 

Those figures suggest Meta continues to be the most dominant social network in the world, despite a historically challenging year for its business in 2022. 

Details: Meta reported $4.2 billion in restructuring charges for the fourth quarter and says it expects to spend another $1 billion on restructuring costs for the year. 

Those costs were attributed to a number of short-term operational changes, including severance payments to laid-off employees and early termination fees for office leases. 

Between the lines: The company continues to lose a significant amount of money on its virtual and augmented reality division. 

Reality Labs lost $4.27 billion last quarter, bringing its total losses for the year to $13.71 billion. The unit generated $2.15 billion in revenue last year, down slightly from $2.27 billion in 2021. 

Be smart: The company's optimistic projections for its first quarter revenue are an important update considering Meta competitor Snap Inc. on Tuesday told investors that it expects revenue to decline 2%-10% in the same time period. 

The big picture: Wednesday's earnings end a year-long losing streak on Wall Street for the company. Meta's stock lost roughly 70% of its value in 2022.

Part of that drop was attributed to a slowdown in the ad market, but investors were also skeptical about how quickly the company could make its heavy investments in metaverse-building pay off. 

What to watch: Now, Meta looks to be leaning more heavily into artificial intelligence, as an opportunity to boost its lucrative advertising-based social media and messaging business. 

On an investor call Wednesday, CEO Mark Zuckerberg said he wants Meta to become a leader in generative AI and use the technology to generate images, videos, avatars and 3D assets across its products. 

"I do think that our philosophy of building these consumer products, focusing on getting them to hundreds of millions or billions of people and then focusing on monetization beyond that ... is the right approach. It served us well," he said. 

"You can expect us to continue doing that on future things that we do, including  hopefully some of the new generative AI products or some of the new metaverse stuff that we're doing. We're going to take the same approach there as well."

Revenue:  $32.17 billion vs $31.53 billion expected, according to Refinitiv

Daily Active Users (DAUs): 2 billion vs 1.99 billion expected, according to StreetAccount

Monthly Active Users (MAUs):  2.96 billion vs 2.98 billion expected, according to StreetAccount

Average Revenue per User (ARPU): $10.86 vs $10.63 expected, according to StreetAccount

Meta stock soars following revenue beat, positive outlook

Yes, but: The company still lost money last quarter compared to the same quarter in 2021.

Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images

Meta (company)

Big Tech

Shares for Facebook parent Meta jumped more than 17% in after-hours trading Wednesday, after the tech giant beat Wall Street expectations on revenue and user growth. Of note: Meta also provided positive first quarter guidance and said it expects expenses for the full year to be lower than originally forecasted.

From the Valley to D.C., Big Tech players like Facebook, Google and Amazon are under more scrutiny than ever as new technology develops and privacy and antitrust concerns grow in lockstep with companies’ ambitions.

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Meta investors got a double dose of good news on Wednesday. The Facebook parent company reported better-than-expected quarterly results and won a favorable ruling from the judge overseeing the FTC's move to block a virtual reality acquisition.

Why it matters: Meta's positive earnings come amid dour reports from many other flagship tech firms that are struggling in a softening economy.

Meta reported quarterly revenue of $32.16 billion, ahead of Wall Street estimates of approximately $31.5 billion. It also raised its authorized stock buyback by $40 billion and said to expect revenue of between $26 billion and $28.5 billion for the current quarter, which runs through the end of March.

Earlier in the day, a judge gave Meta the go-ahead to buy virtual reality fitness startup Within, rejecting the Federal Trade Commission's bid to block the acquisition. Per Bloomberg, U.S. District Judge Edward Davila made the ruling in sealed court documents, adding that Meta must wait a week before closing the deal to give the agency time to appeal his decision.

Shares of Meta surged more than 17% in after-hours trading Wednesday following the earnings report.

The big picture: Meta has been retrenching of late, announcing plans to lay off workers, cut some hardware projects and scale back its investments in real estate and data centers.

As part of Wednesday's earnings report, Meta said it took a restructuring charge of $4.2 billion in the fourth quarter.

Be smart: The company's optimistic forecast contrasts with the outlook from competitor Snap Inc., this week, which told investors that it expects revenue to decline 2%-10% in the current quarter.

Yes, but: Meta's Reality Labs unit — which is spearheading its metaverse projects — lost $4.27 billion last quarter, bringing its total losses for the year to $13.71 billion. The unit generated $2.15 billion in revenue last year, down slightly from $2.27 billion in 2021. 

Between the lines: The company has also managed to be less in the spotlight in recent months thanks to upheavals at Elon Musk's Twitter, as well as recent regulatory moves against Microsoft and Google.

What to watch: The FTC is set to start a separate trial to block the Within deal in its own administrative court on February 13, though it could opt not to move forward after the ruling in California.

Meta's good day

Wall Street liked what it heard in the Facebook parent's latest earnings, and the company also won a round with the FTC.

Illustrated collage of Facebook’s like button and dollar bills.

BDG Media suspending operations at Gawker

BDG Media's CEO announced in a memo that it can't keep investing in Gawker.

Media deals

BDG Media is suspending Gawker and will lay off 8% of full-time staff, according to an internal memo from CEO Bryan Goldberg that was obtained by Axios.Why it matters: The news comes as BDG continues to search for a buyer or potential liquidity partner.

Shares in Google parent Alphabet fell nearly 5% in after-hours trading Thursday, after the tech giant said it missed revenue and earnings estimates for the fourth quarter.

Why it matters: Alphabet and its stock thrived during the pandemic. Now, an ad slowdown and its big investment in headcount are challenging its earnings growth just as it's entering a new phase of competition with Microsoft and others in AI.

"We have significant work underway to improve all aspects of our cost structure, in support of our investments in our highest growth priorities to deliver long-term, profitable growth," CFO Ruth Porat wrote in a letter to investors. 

Details: The company blamed an ad slowdown at YouTube for missing estimates. 

YouTube advertising was down more than 7% last quarter compared to the same quarter the previous year, causing Alphabet's overall revenue growth for the quarter to drop to just 1% year over year. 

Be smart: For years, YouTube has been one of Google's strongest advertising growth engines. Executives said YouTube saw a slowdown in brand ads, or ads that tout a company's reputation, and direct response ads, which push sales. 

Between the lines: Like rival Meta, Google said it would take a loss of $4.2 billion, mostly in the first quarter, for restructuring costs related to severance payments to 12,000 recently-laid off employees.

It also expects to take a roughly $500 million loss related to reduced office space plans this quarter. 

Earnings per share: $1.05 vs $1.18 per share expected, according to Refinitiv 

Revenue: $76.05 billion, vs. $76.53 billion expected, according to Refinitiv

YouTube advertising revenue: $7.96 billion vs. $8.25 billion expected, according to StreetAccount estimates.

Google Cloud revenue: $7.32 billion vs. $7.43 billion expected, according to StreetAccount estimates

Traffic acquisition costs (TAC): $12.93 billion vs. $13.32 billion expected, according to StreetAccount estimates

The big picture: Despite a slowdown in ads, executives pledged to continue Google's artificial intelligence push.

“Our long-term investments in deep computer science make us extremely well-positioned as AI reaches an inflection point, and I’m excited by the AI-driven leaps we’re about to unveil in Search and beyond," CEO Sundar Pichai said in the company's investor letter.

The company also said it would separate its artificial intelligence company DeepMind from its other investments when reporting earnings, a nod to its commitment to growing in that space. 

"AI is an Alphabet strategic priority," Porat said, and the reporting change "reflects strategic focus."

What to watch: Despite record regulatory scrutiny and major market shifts, Google continues to take big swings. YouTube successfully won the NFL's very lucrative Sunday Ticket package, giving it exclusive rights to air out-of-market NFL games beginning next season.

Alphabet stock slips on earnings miss, YouTube ad slowdown

Google missed earnings and revenues estimates for 2022's fourth quarter.

Alphabet Inc.

Shares in Google parent Alphabet fell nearly 5% in after-hours trading Thursday, after the tech giant said it missed revenue and earnings estimates for the fourth quarter.Why it matters: Alphabet and its stock thrived during the pandemic. Now, an ad slowdown and its big investment in headcount are challenging its earnings growth just as it&#x27;s entering a new phase of competition with Microsoft and others in AI.

Sara Fischer

Stories

Alphabet stock slips on earnings miss, YouTube ad slowdown

Dave Portnoy drops appeal over his lawsuit against Insider

Meta's good day

Meta stock soars following revenue beat, positive outlook

BDG Media suspending operations at Gawker

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Axios Media Trends: Spotify CEO's 2023 focus

Axios Media Trends: Local news lifeboat

Axios Media Trends: 📈 Robinhood's media spinoff

Axios Media Trends: ⏳ Deal frenzy stalled

Axios Media Trends: 📍 News engagement stabilizes