Table of Contents
Disney has officially appointed Parks Chairman Josh D’Amaro to succeed Bob Iger as CEO, ending a high-stakes succession saga, while Elon Musk confirmed the merger of SpaceX and xAI into a new entity valued at $1.25 trillion. These major corporate shifts occurred alongside a volatile trading session where Palantir surged on strong revenue forecasts, defying a broader sector selloff driven by fears that advanced AI models from competitors like Anthropic are rendering legacy software obsolete.
Key Points
- Disney Succession: Josh D’Amaro, a 28-year company veteran, will replace Bob Iger following the annual meeting on March 18, with Iger remaining to mentor through 2026.
- Musk’s Mega-Merger: SpaceX and xAI are combining to form a vertically integrated firm valued at approximately $1.25 trillion, aimed at leveraging space infrastructure for AI compute.
- Palantir Surges: The data analytics firm projected $7.19 billion in revenue for the fiscal year—nearly $1 billion ahead of consensus—driving shares up despite a tech downturn.
- Software Sector Anxiety: Legacy SaaS stocks are facing a "Doomsday" sentiment as investors fear generative AI tools like Claude are eroding the pricing power of traditional seat-based software.
Disney Taps D’Amaro for Top Job
In a move to stabilize leadership at the entertainment giant, The Walt Disney Company has named Josh D’Amaro as its next Chief Executive Officer. D’Amaro, currently the Chairman of Disney Parks, Experiences and Products, is a 28-year veteran of the company who navigated the parks division through the turbulent post-COVID era.
James Gorman, Chairman of the Disney Board, emphasized that the search was exhaustive, involving candidates from around the globe before settling on the internal choice.
"Josh is a standout executive... We wanted to do it right and make sure that whoever got the job beat all comers. Bob [Iger] will work with him through 2026, guiding him and helping to develop him."
D’Amaro will officially take the helm at the annual meeting on March 18. While specific contractual performance goals have not yet been set, the mandate is clear: navigate the decline of linear television, optimize streaming profitability, and integrate artificial intelligence into the company's creative engines.
Musk Combines SpaceX and xAI
Elon Musk has announced the combination of his aerospace company, SpaceX, and his artificial intelligence venture, xAI. According to internal memos, the merger creates a vertically integrated entity valued at approximately $1.25 trillion, with SpaceX revalued at $1 trillion and xAI at $250 billion.
The strategic rationale involves utilizing space infrastructure to support the immense computational needs of AI. Musk’s vision includes building massive data centers in orbit to handle complex AI processing, theoretically bypassing terrestrial energy and cooling constraints. However, the move has generated skepticism among some investors who view the pivot to AI infrastructure as a potential distraction from SpaceX’s founding mission of Mars colonization.
Operationally, the two entities are expected to remain distinct for the near future due to regulatory complexities. SpaceX is subject to strict defense-related regulations (ITAR) regarding information flow, which do not currently apply to xAI.
Palantir Defies the "Software Apocalypse"
While the broader software sector faces intense selling pressure, Palantir Technologies delivered what analysts described as a "stunning" quarter. The company issued a revenue forecast of $7.19 billion, significantly outpacing Wall Street's expectations. The stock, which had been up as much as 12% during the session, settled with solid gains while peers faltered.
Analysts attribute Palantir’s resilience to deep customer buy-in. Unlike "democratized" software tools that are easily swapped out, Palantir’s heavy enterprise integration has led to massive spending expansion among its top 20 clients.
"The top 20 customers of Palantir [have spent] $95 million over the past 12 months. There is no other software company that we follow that is doing anything remotely close to that... As long as existing customers are willing to expand anywhere near these levels, you will still see Palantir grow at strong rates for the foreseeable future."
However, the company faces headwinds in new customer acquisition, which is down 40% year-over-year. The high cost of implementation and complex deployment requirements remain hurdles for mass adoption, particularly in international markets where growth trails the U.S.
Market Impact: The Fear of AI Displacement
Palantir’s success stands in stark contrast to the rest of the software-as-a-service (SaaS) market. Traders are increasingly dumping legacy software names due to fears that generative AI agents—specifically citing Anthropic’s latest developments—will automate tasks that previously required paid human seats on software platforms.
This sentiment, described by some traders as an "apocalypse" for traditional software models, has driven valuations to multi-year lows. Investors are questioning the long-term pricing power of companies like Salesforce and Microsoft as AI tools become capable of executing complex workflows autonomously.
Defense Tech and Gaming Updates
Beyond the mega-cap headlines, the defense technology sector continues to attract capital. Overland AI has raised $100 million to scale its autonomous ground vehicle operations. The company, which specializes in off-road autonomy for the U.S. Army and Marines, is expanding manufacturing to meet demand for systems capable of reconnaissance and hazardous breaching operations without human intervention.
In the gaming sector, the industry remains in a state of correction. While Nintendo is preparing for the launch of the "Switch 2"—projected to sell 19 million units—profitability concerns linger due to rising component costs caused by AI demand for memory chips. Meanwhile, Obsidian Entertainment was highlighted as a rare outlier, successfully shipping three titles in a single year, though studios across the board are struggling to align long development timelines with sales targets.
As the market digests these massive structural changes—from Disney’s leadership to Musk’s conglomerate—all eyes turn to upcoming earnings from Amazon and Alphabet to see if the AI capital expenditure narrative holds firm against growing skepticism regarding immediate returns.
