David Reads The Trades

David Reads The Trades: April 7, 2026

Toplines

  • Sony Pictures Entertainment layoffs are underway, with an estimated 200–300 mid-level employees expected to be cut; the company is refocusing on ROI drivers including Crunchyroll, anime, and PlayStation IP adaptations.
  • The Lionsgate/Graham King Michael Jackson biopic Michael opens April 24th; the film ends during Jackson’s Bad Tour rather than with the 1993 Neverland Ranch investigation sequence, which was cut following objections from the Jackson estate.
  • Lionsgate and Universal (international) are targeting at least $700 million worldwide for Michael; the original cut ran over three and a half hours, and Graham King still hopes to produce a two-part story.
  • Paramount/Skydance has confirmed that approximately $24 billion in Middle East funds — from Saudi Arabia and Abu Dhabi — are backing the $108 billion Warner Bros. Discovery acquisition, representing over 20% ownership of the combined entity; the investors will allegedly not receive board seats.
  • Paramount/Skydance issued warrants to existing Paramount shareholders as part of the equity syndication, sending the stock up roughly 3–3.5%, though it remains under $10 a share.
  • Netflix will report Q1 earnings a week from Thursday; Disney’s Q1 results drop in early May, on the final day of CinemaCon.
  • The Drama starring Zendaya opened to approximately $15 million domestically, consistent with her Challengers opening.

Sony Layoffs: Painful but Not Shocking

Deadline’s breaking news this morning is Sony Pictures Entertainment layoffs underway today. The specifics are thin, but the broad strokes are there: Sony is refocusing around return-on-investment drivers — Crunchyroll, anime broadly, PlayStation IP adaptations for film and television — and cutting things that don’t fit that mandate. Pixomondo, apparently, is one of the casualties. I’ll be honest: I don’t even know what Pixomondo is. But they’re not doing it anymore.

The statement Sony put out is everything you’d expect from someone who just got their MBA. “Over the last year, we have sharpened our strategy and clarified where we believe the greatest opportunities exist. As we lean into those priorities, we need to operate with greater focus, speed, and alignment to strengthen our differentiated capabilities.” Boy, somebody went to business school. “We are aligning our organization with where the business is going, not where it has been.” Yeah. You don’t say.

Here’s the thing though: unlike a lot of the corporate-speak we’re going to talk about today, the argument Sony is actually making isn’t really bullshit. This is a company making a strategic pivot. It’s 200 or 300 people, all in the middle range of the income spectrum, and they’re thinning out the room. Not fun. Not okay. Not happy. But it is what it is.

The good news — and I use that phrase cautiously — is that it’s hundreds and not thousands. Because thousands is what’s still happening at Paramount. Thousands is what’s going to happen at Warner Bros. when that deal closes further. We are still in that time. But I’ve been having this argument, and I’ll say it again: I think we are toward the end of it. The Wall Street Journal has been beating this drum for years now — the industry is dying, employment is collapsing, the sky is falling. And yes, in the context of raw labor statistics, there’s something to it. But in terms of what it actually means for this industry in this moment, it doesn’t mean what they keep insisting it means. It’s been Chicken Little all the way, the same people, over and over again.

I like Ben Fritz’s work, generally. There’s nothing wrong with Ben Fritz. But they just have a tendency to beat this thing to death. And I’ll tell you how far this has gone: I found myself agreeing with Sharon Waxman on Twitter the other day about the Ben Fritz piece from the Journal. I’m agreeing with Sharon. Shocking. Truly shocking. Though I’m sure Sharon and I agree on more than people would expect. Just not on certain other things. Anyway.

I do feel for the people at Sony who are going through this. Middle management is a strange and difficult place to find yourself without a job. There’s nothing easy about being fired because you were in the middle of the org chart, making decent money but not life-changing money. If you were making mid-seven figures, you’ve got something to fall back on. If you were pulling low-to-mid six figures and spending like you were making two or three million, losing the job is genuinely hard. I hope the people affected land somewhere good.

The Michael Spin Cycle

The top story in Variety this morning is “Inside the Michael Overhaul.” It’s written by Brett Legg with Rebecca Rubin and help, which means we’re in for a treat — a lot of fictionalizing, or at least a lot of presenting single-source guesses as established fact, which is what they do a lot of over there now. But there’s something genuinely interesting buried in the piece, and it’s this: they’re now trying to sell us on the idea that Michael is one movie.

That is not what I’ve understood for the last year and change. My understanding has been that there are two movies. There was a three-and-a-half-hour cut. There was real momentum toward a two-parter. And now, suddenly, Lionsgate is using Variety — as Variety is usable — to float the story that it’s just one movie. Except there’s also this little side door left open: but there could be another movie. There could be another movie. It’s weird. It’s very weird.

What happened is pretty obvious. They watched what happened to Wicked — the self-abusing second film that should never have been a second film — and Graham King and Lionsgate looked at those numbers and said, I don’t know about Michael 2. Let’s just call it Michael and not tell anybody about Michael 2. Which, fine, as a marketing strategy. I get it. But let’s not pretend we don’t know what they’re doing.

The Variety piece, with characteristic careful sourcing — “somebody who has seen the movie,” not “we have seen the movie” — tells us the film ends during Jackson’s Bad Tour, with him preparing to take the stage. The original script apparently concluded with his sorrowful gaze as police car lights flash behind him — 1993, a decade after Thriller gripped the culture, Jackson accused of child molestation. The sequence with investigators arriving at Neverland Ranch was shot, but it’s on the cutting room floor.

The spin on why that scene was cut is where it gets interesting. According to this piece, the Jackson estate’s attorneys objected not because they minded Michael being depicted as accused of child molestation — apparently that was fine — but because one of the accusers, Jordan Chandler, has a settlement that allegedly bars any depiction or mention of him in a film. My guess? They didn’t name him in the movie. My guess is there was a pseudonym, because that’s what people in this industry do. But they’re telling us now it was a mistake by the Jackson estate, and the estate then put $10 to $15 million of its own money into reshoots, making them partial owners with an equity stake.

Did they already have an equity stake? Of course they already had an equity stake. How much did they put in originally? When? Why? I don’t believe any of this. I’m not saying it’s completely untrue — I don’t have any reason to say that definitively — but I also don’t have any reason to believe it’s true. This feels like a story that has been created. We’ll be at CinemaCon next week and we can ask the questions and they’ll have these answers ready, which will only confirm that the answers were prepared in advance.

I want to be clear about something: I don’t care how they made the sausage. I’ve never cared. I’ve been involved in making things over my career — as a writer, director, producer, production coordinator, God knows what else — and I’ve been party to all kinds of things on sets and in edit bays. I was there when George Clooney freaked out on Baby Talk, for what it’s worth, and in a good way. The point is: what happens on set, in the cutting room, in the reshoot process — it doesn’t matter. What matters is what the movie is. If the movie’s bad, sure, have whatever conversation you want. But if people enjoy it, the story of how the sausage was ground up is just a distraction from the work.

That said: Lionsgate is absolutely using this story, and using Variety specifically to tell it, for a reason. The strategy is pretty transparent. End the film at the zenith — the Bad Tour, the electrifying performance — and leave the audience wanting more. Let them ask what happens next. And then, if the movie performs, they’ll make Michael 2.

I had actually assumed for a while the film would end with Thriller — that would have been the natural cultural peak. Ending with Bad is interesting to me personally. I was 21, 22, producing a Black music video show that had been based at KBC in New York, and a syndicator took over. Anyway, that’s a whole different conversation. But I remember sitting in a post house in New York City when the Scorsese-directed video for “Bad” hit MTV, and everybody in that studio stopped what they were doing. Every table was on it. It was a cultural moment, a genuine event.

But here’s the thing: ending with Bad means you’re ending at the beginning of the problems. There is so much story left. And they’re over there saying they have 30% of footage in the can that they can use for a second movie if they want to make a second movie. If? Graham King still hopes to turn Michael into a two-part story. Still hopes. So all of this is very murky, and I think they just don’t want to admit it. I think it’s a two-part movie. They want people to see it as though it’s the only movie, feel the incompleteness of it, and then come back for more. That’s the play.

Internally, Lionsgate and Universal — which has international — are targeting at least $700 million worldwide. That’s not an outrageous number for this movie. I don’t know that it does more than $300 million domestic, but internationally I think it could do five or six hundred. And China is going to be a very significant variable here. Whatever China does on this movie is going to matter a lot to the final number. Graham King is a hard-ass producer — good in certain ways, scary in certain ways — but I’ve always liked Graham. He’s also as full of shit as anybody. And I’ll note, since we’re talking about Graham: the movie I talked with him most about, the one I remain genuinely disappointed hasn’t been made, is the Dean Martin movie he was going to make with Scorsese right after The Departed. It never happened. Anyway.

Paramount/Skydance and the Middle East Money

Paramount confirmed this morning what was not exactly a secret: the Middle East funds that backstopped David Ellison’s prior bid for the Warner Bros. assets — the bid that was ultimately rejected in favor of Netflix — are back in the new deal. They didn’t go anywhere. They were never going anywhere. And now Paramount/Skydance is confirming that approximately $24 billion in Saudi and Abu Dhabi money is part of the $108 billion Warner Bros. Discovery acquisition, giving those investors over 20% ownership of the combined entity.

The statement from Paramount/Skydance is a masterpiece of corporate nothing. The successful equity syndication is “an important milestone in the Warner Brothers Discovery transaction process” and the “resulting diversification of its shareholder base” and “the value of the warrants described below enhance long-term shareholder value.” They also believe the warrants “support its longer-term objective of a wider and deeper public float.” Translation: they’re coming for your money. They want retail investors in this thing eventually.

The warrants issued to existing Paramount shareholders are new, and yes, the stock shot up Tuesday. It’s up 33 cents, and it’s still under $10 a share. So I’m not sure “shot up” is exactly the right characterization of a 3.5% move on a sub-$10 stock, but okay, sure.

Here’s what I keep coming back to: the question of whether foreign sovereign wealth funds can own more than 20% of a company that owns CBS is a real, legitimate question. It’s the kind of question the SEC or the FCC would normally examine. It’s the kind of question that, under any other administration, would at minimum generate significant regulatory scrutiny. Under this one? I don’t think anybody’s going to look at it very hard.

They’re rationalizing it away with a lot of flowery, businessy language, and the Hollywood Reporter piece barely gets into it. But it shouldn’t go away. It’s a real issue. The trade press has a tendency to treat these mega-deals as sports scores — who won, who lost, how much — without sitting with the more uncomfortable implications of what it actually means when foreign governments own significant chunks of American media institutions.

Now, I want to say something on David Ellison’s behalf, which is not something I do naturally. He was getting beat up in the press yesterday for saying that 70% of the country is center-left or center-right, in the context of defending CBS News. I actually agree with him on that. I’ve been saying it for a long time. I think it’s probably more than 70%, frankly — it’s just that it leans more center-left than center-right on most issues. But we are a centrist country. Not a Trumpist country. Not a left-wing extremist country. People just want to live their lives. That’s a recurring theme in everything I do, and I think it’s genuinely true.

Whether I trust David Ellison to actually run CBS News in a centrist way is a different question. The early signs are not great. There’s already been what I’d call a terrible start at CBS News, and there are credible threats about what’s going to happen to 60 Minutes this summer. It may lean further right. It’s already showing signs of drifting from where it’s been historically, which has been genuinely centrist long-form journalism for decades.

But here’s the thing: until it happens, you can’t really claim it happened. It’s not fair, even to David Ellison, to convict him of something in advance. What I will say is this: right now, Trump is kissing Ellison’s ass because they’re friendly and it’s useful. If there were a Democratic president, my guess is Ellison would lean a little further left. Call that cynical. I think Larry Ellison’s politics, at the end of the day, are downstream of his money. His money is what matters, first and last. He’s navigating the Mad King as best he can, and I’m not saying that’s okay, but it does skew any reading of his actual ideological commitments.

The Kennedy Center, the DOJ, and the Ongoing Absurdity

The Kennedy Center is defending its name changes in court, and the DOJ — which has fully become a private law firm for Donald Trump — is arguing that Congresswoman Joyce Beatty of Ohio, who filed the lawsuit, hasn’t suffered any tangible harm from the board’s decision to adopt a secondary name and close the center for renovation. Technically, they’re right. Joyce Beatty personally has not suffered reputational harm or physical harm or intangible harm. The Kennedy Center has suffered. The country has suffered. But Joyce Beatty personally? The DOJ argument technically holds. That’s how they’ll win this, by making it about Ms. Beatty rather than about the institution.

The center’s defense includes the claim that using a secondary name for a federal entity is not uncommon — they cite Fannie Mae as an example of a federal institution operating under a nickname. Yes. Putting your own name ahead of a dead president who has a building in his honor is exactly the same thing as a Depression-era housing agency having a nickname. Exactly the same. The same logic applies to renaming the Department of Defense the Department of War, which is also apparently on the table. All of these things will go away when Trump is out. We’ll go back to calling the Gulf of Mexico the Gulf of Mexico. It’s all disgusting and it’s all consistent. Somebody’s fighting it, at least.

The renovation argument is presented as a choice between a focused two-year project and a prolonged multi-year series of patchwork repairs. And fine, the Kennedy Center genuinely needs work. Everybody agrees on that. But this is the same Donald Trump who knocked down the East Wing of the White House without telling anyone he was going to do it — just ordered it done inside his little air bubble. The idea that what Donald feels like doing is simply what Donald should be allowed to do is, of course, absurd. Unfortunately, we have a DOJ and elements of a Supreme Court that seem to have reached a different conclusion.

I’ll stop there because this is not a political podcast. But we’re all touched by the politics whether we want to be or not.

The Emerald Fennell / Basic Instinct Non-Story

There was a rumor circulating on Twitter about Emerald Fennell remaking Basic Instinct at Sony. It turns out Joe Eszterhas — who is always looking for a bit of attention, and hasn’t had a lot in the last decade — was apparently the one floating this. My guess is he’s not a hundred percent lying. Somebody at Sony probably said, sure, we’re thinking about redoing it, maybe with Emerald Fennell, she’d be great. But now everybody’s people — her people, his people, the studio’s people — is denying it ever happened.

There’s a certain contingent, particularly in Europe, that’s been trying to pin bad-faith projects on Fennell since Wuthering Heights, which many people over there felt she ruined. I disagree. I’m not the biggest fan of the source material, but I think she did what she was trying to do, and it was effective on its own terms. Whether it was the right choice is a whole other conversation. But this Basic Instinct thing feels like it got out of hand fast, and now everyone’s running away from it.

Zendaya Is a Movie Star, Full Stop

There’s a story making the rounds calling Zendaya the new “indie box office queen” based on The Drama’s opening. I’d push back on the framing. She’s not the indie box office queen. She’s a movie star. Period. The Drama opened to around $15 million. So did Challengers. Both of those openings rest on her — Robert Pattinson, for all his considerable gifts as an actor, does not open movies. He’s genuinely one of my favorite and most underrated working actors. I thought he was remarkable in the Jennifer Lawrence movie from last year — she gave this enormous performance, one that I think was fantastic and underrated in a weird way, she didn’t even get an Oscar nomination — and Pattinson was quietly brilliant playing the asshole husband against her. But he doesn’t put people in seats. The opening of The Drama is on Zendaya, and so is Challengers.

Beyond that, she’s been the engine or a significant part of the engine behind years of massive IP films — Dune, Spider-Man — where you can’t isolate her contribution, but she’s clearly driving something. And this year alone she’s got Dune 3, Spider-Man: Brand New Day, and The Odyssey, on top of the new season of Euphoria. She says she’s going to hide out after all of that. She won’t. But she’s going to have a year that would be remarkable by any standard. She’s a movie star.

J.J. Abrams Is Downsizing, and That’s Fine

The Hollywood Reporter’s Heat Vision has a piece by Boris Kitt — a smart guy, worth reading — about why J.J. Abrams is downsizing: closing the beloved Santa Monica office that everybody loved, moving to New York. People are whining about it. Stop. He’s going to be 60 years old this year. He’s changing his life. Steven Spielberg apparently moved to New York this year too, which I hadn’t even clocked.

J.J. has projects. He directed The Great Beyond, which is coming out in November. He has The End of Oak Street from David Mitchell, out in August. He’s got a Dr. Seuss adaptation — Oh, the Places You’ll Go — coming in a few years from Jon Chu. He’s not out of the business. But his last studio deal at Warner Bros. was signed in 2019, and he lost his key executive Hannah McGill to Netflix a year or two ago. It’s not the Bad Robot that it was. It’s not the empire he was building. And that’s okay. People are allowed to restructure their lives. The Santa Monica office was great. I get the nostalgia. But J.J. Abrams doesn’t owe anyone a continuation of his previous mode of existence.

Howard Stern’s Former Assistant and the NDA Racket

Howard Stern’s former executive assistant — Leah Kuh, who actually lived with Stern and his wife at their Southampton home — is trying to void her NDA, claiming hostile work environment. She was apparently terminated for cause, and her firing, she says, was a result of pressure from an animal rescue organization run by Stern’s wife.

She was making $265,000 a year as an executive assistant. She got a raise before she was fired.

I’m sorry, but this doesn’t sound like someone being held in a dungeon in Southampton. And the NDA exists for exactly this reason. This feels like a shakedown. I don’t enjoy defending very rich people who do very stupid things, but sometimes the math just doesn’t add up.

This got linked in the piece to the De Niro assistant situation — where De Niro’s former personal assistant was awarded $1.3 million after a gender discrimination and retaliation trial. Her title was VP of Production and Finance. Her complaints included being asked to button his shirt and wash his sheets. You genuinely cannot make this stuff up. People who are wildly overpaid for proximity to celebrity, who then discover that the job involves some unpleasantness, and who then decide to monetize the unpleasantness. I don’t know what to tell you.

Hacks, Podcasting Costs, and the New Season of Summer House

The new season of Hacks is good. Angie Han’s review in The Hollywood Reporter calls it trading sharpness for sweetness, which is accurate. It does feel like a swan song — warmer, more of the supporting cast, going back to characters who’d drifted away in previous seasons. I like it. It’s not as sharp as it was, but there’s something genuinely lovely about it.

There’s a piece in IndieWire about podcast production costs — narrative podcasts run $300,000 to $600,000 a year. Host, reporter, fact checker, sound designer, composer, executive producer, senior producer, junior producers, art department. For a daily show, that works out to roughly $1,000 to $2,300 an episode, depending on scale. I’m doing this for free, on Substack, unedited. That has always been my thing — the DP30 interviews are still on YouTube, 30-plus minutes, uncut, because I want the full picture, not the edited one. The idea of a production budget for what I do is honestly absurd. But $1,000 an episode for a proper production? Not outrageous. Once you’re making millions off a podcast, it makes complete sense.

The Summer House spinoff — In the City — premieres May 19th. Apparently one of the former core couples of Summer House is now in a post-divorce scandal involving a friend of theirs and a sexual affair, which the show is dropping right into. It’s somehow structurally similar to the whole Vanderpump Villas / Mormon Wives entanglement, which I can’t believe I know enough about to have an opinion on, and yet here I am. Building brands is hard. Two of the Summer House alums are apparently cameo-ing in an upcoming Hulu show, and they have made abundantly clear they have no business acting.

Stock Market Check

Dow is down roughly 250 points. S&P 500 down about 30. NASDAQ down 158. Entertainment stocks: Netflix and Disney are both down slightly, both still under $100 a share. Disney really should be over $100 — the reason it isn’t is ongoing fear about what oil prices and consumer headwinds are going to do to the parks, which remain an enormous part of their revenue picture. Paramount/Skydance is up 33 cents — call it 3.5% — on the warrant news. Warner Bros. Discovery is hanging around $27. Comcast is up seven cents. Sony is barely moved.

Netflix drops Q1 earnings a week from Thursday. Disney’s Q1 results come in early May — specifically on the last day of CinemaCon, which is an interesting scheduling choice. Everything is confused. Everything is being buffeted by macro forces that have nothing to do with whether the movies are good or bad or whether the streaming numbers hold up. We’re all just watching and waiting.