🧘 Welcome back to a new week! Hope here — Nathan is off for a few days of rest. (Btw, we're still wondering what Netflix CEO Reed Hastings is thinking about today after Apple's best picture Oscars win.)

🚨 Situational awareness: FedEx founder Fred Smith is stepping down as CEO of the company he founded more than 50 years ago.

Today's newsletter, edited by Pete Gannon, is 672 words, a 2½-minute read.

🔔 The dashboard: The S&P 500 closed up 0.7%.

  • Biggest gainer? Tesla (+8.0%) on news it will pursue a stock split to pay a dividend to investors. More below.
  • Biggest decliner? Discovery (-6.5%). ¯\_(ツ)_/¯

1 big thing: Embracing the meme

Illustration: Aïda Amer/Axios

The meme stock trade mania of last year has turned into a long-term relationship for AMC, Hope writes.

Why it matters: AMC now views its new popularity as a mandate to do "exciting things," even if those things draw puzzled looks.

Driving the news: AMC CEO Adam Aron says the movie theater chain will now take on more “transformational” deals to harness the support of the retail trading block, Reuters reported today.

  • His comments come two weeks after AMC announced it would throw $28 million into Hycroft Mining, a struggling gold-and-silver mining company.
  • "Our shareholder base has given us capital to deploy with the clear expectation that we are ... going to do exciting things with the money they entrusted to us," Aron told Reuters.

Flashback: In 2021, AMC raised more than $1.2 billion in a single quarter by selling new shares mainly to retail traders (small investors trading with their own money) who fueled a fevered interest in certain stocks as an anti-establishment play.

Between the lines: A kind of loyalty (or co-dependency, depending on how you look at it) has formed between AMC and these traders who saved it from bankruptcy and drove its price, valuation and narrative “to the moon.”

  • “Aron is going to be forever grateful and cater to that investor base,” Andrew Freedman, a media analyst with Hedgeye, tells Axios. 

The big picture: It’s pretty well known at this point that AMC’s valuation has nothing to do with its underlying business of selling seats and popcorn at its movie theaters.

Go deeper.

2. Charted: Tesla eyes stock dividend

FactSet; Chart: Axios Visuals

Tesla’s looking to reward its shareholders with more stock as shares have fallen 10% this year, Hope writes.

Catch up quick: The carmaker wants to split its stock so it can pay a stock dividend, an SEC filing dated today shows.

  • The company is set to ask shareholders to approve an increase in the number of outstanding shares of its common stock at its annual shareholder meeting later this year.
  • Tesla’s stock closed up 8.0% today.

The big picture: Alphabet and Amazon are planning to split their stocks too to make shares more affordable following the pandemic-driven market rally.

3. What's happening

🏛 President Biden released his 2023 budget proposal focused on deficit reduction. (Axios)

🚗 Nio has started deliveries of its luxury EV sedan on schedule. (CNBC)

🙊 Barclays made a nearly $600 million flub. (WSJ)

4. Walmart — no butts about it

Photo: Angus Mordant/Bloomberg

Walmart has quietly removed cigarette products from some of its stores, but it's not officially halting all tobacco sales, Axios' Pete Gannon writes.

Context: Walmart has long discussed internally the eventual goal of getting out of tobacco, due to the costs involved and the company’s effort to bolster its presence in the health care space, WSJ reported.

  • CVS pulled tobacco sales in 2014 citing its conflict with its mission to be a health care provider.
  • Target stopped in 1996, saying it was too costly to police the sale of products to minors.

Between the lines: Walmart has gradually been moving its store layouts to include more self-checkout kiosks, WSJ reported.

  • The move makes tobacco sales more difficult, as the FDA requires an employee to make the sale of tobacco products.

5. One unusual night

Will Smith slaps Chris Rock onstage at Sunday's Oscars. Photo: Robyn Beck//AFP via Getty Images

There's now a formal investigation into Will Smith's slap of Chris Rock on stage last night, Hope writes.

  • The Academy of Motion Picture Arts and Sciences says it condemns the actions and "will explore further action and consequences" with its bylaws and California law.

Details: More people may have seen the slap in reports from last night than watched it live.

  • At least 15.3 million people watched Sunday's 94th Oscar Awards, Axios' Sara Fischer reports. That's according to preliminary figures from Nielsen.
  • It's a considerable improvement from the 9.85 million people that were counted immediately following last year's show.

6. What they're saying

“[T]he ‘Don’t Say Gay’ bill should never have passed and should never have been signed into law."
— The Walt Disney Company, in a statement, after Florida Gov. Ron DeSantis (R) signed into law the controversial Parental Rights in Education bill. Disney's now public opposition follows an employee protest of its previous response.

Thanks to Sheryl Miller for copy editing today's (and every day's) newsletter.