Core Points - Character.AI, a tech startup, has removed several Disney characters from its chatbot platform following a cease-and-desist letter from Disney alleging copyright infringement [1][2] - The letter from Disney's legal representatives stated that Character.AI's chatbots impersonated iconic Disney characters and misled consumers into believing they were interacting with official Disney content [2][3] - Disney expressed concerns over inappropriate conversations that chatbots may have engaged users in, further complicating the situation [3] Company Actions - Character.AI stated that it responds quickly to requests from rights holders to remove content and mentioned that the characters on its platform are user-generated [4] - The spokesperson for Character.AI indicated that the removal of characters is a process and that some Disney characters, like Elsa, still remained on the platform at the time of the report [4] Industry Context - The friction between Hollywood studios and AI companies is increasing, as evidenced by Disney and Comcast's Universal Pictures suing AI company Midjourney for copyright infringement related to characters from popular franchises [5][6] - Warner Bros. Discovery has also joined the legal actions against Midjourney, alleging that its software produces unauthorized versions of well-known characters [6]

Conagra Brands, Inc. (NYSE:CAG) Earnings Preview: Key Financial InsightsConagra Brands, Inc. (NYSE:CAG) is a major player in the packaged foods industry, known for its wide range of products including frozen, refrigerated, and shelf-stable foods. As the company prepares to release its quarterly earnings on October 1, 2025, Wall Street analysts have set their sights on an earnings per share (EPS) estimate of $0.33, with projected revenues of around $2.62 billion.Despite these projections, Conagra is expected ...

Financial Data and Key Metrics Changes - Sales in Q2 2025 were down 20% compared to the prior year, with first half sales down 3% overall [6][11] - U.S. sales decreased by 10% year-over-year, while all other markets experienced a 33% increase [6][12] - Adjusted EBITDA for the quarter was $2.3 million, down from $12.3 million in the same quarter last year, but up from a loss of $4.9 million in the first half of last year [21] - Adjusted diluted EPS was $0.03 per share in the quarter, unfavorable compared to $0.65 per share last year [21] Business Line Data and Key Metrics Changes - Worldwide toy and consumer business was down 23% in the quarter, while the costume business was down 12% [11][12] - International growth was led by Europe, which grew by 65% in the first half of the year [12][25] - The company is focusing on maintaining a lean inventory, with a decrease of 8% year-over-year in the U.S. while international inventory is higher [45][62] Market Data and Key Metrics Changes - The company has seen limited increases in consumer prices in the U.S., but there are concerns about reduced unit sales due to these price hikes [10][11] - Major U.S. customers are delaying traditional second half planogram resets, impacting the productivity of new product introductions [26] Company Strategy and Development Direction - The company is taking a proactive approach to its manufacturing strategy, diversifying supply chains to mitigate risks associated with tariffs [7][8] - There is a focus on cash generation and prudent inventory management, especially in the U.S. market [45][72] - The company is exploring acquisition opportunities and remains cautiously optimistic about future growth despite current economic uncertainties [24][72] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the unpredictability of the U.S. market due to ongoing tariff changes and is adapting strategies accordingly [5][6] - There is a cautious outlook for the second half of the year, with a focus on profitability and cash generation rather than aggressive sales targets [50][51] - The company is optimistic about the upcoming holiday season, particularly with new product launches and strong consumer interest in established franchises [27][31] Other Important Information - The Board has approved a $0.25 per share dividend for the third quarter [21] - The company completed refinancing its credit facility, providing a predictable source of funds at attractive borrowing rates [20] Q&A Session Summary Question: Short-term levers to mitigate tariff impacts - The company is implementing a duplicate tool initiative to allow flexibility in manufacturing locations to reduce tariff impacts [38] Question: Adjustments to the supply chain - The company is focusing on manufacturing certain products outside of China, particularly in Vietnam, while maintaining quality and efficiency [40][41] Question: Comments on full year 2025 outlook - The company is taking a cautious approach, focusing on sell-through rates and profitability rather than aggressive inventory builds [49][50] Question: Potential for empty shelves during the holiday period - Management believes retailers will focus on proven products and lower price points, with a wait-and-see approach during the Halloween period [54]

Core Viewpoint - Disney and Universal have initiated a copyright infringement lawsuit against AI company Midjourney, labeling it a "bottomless pit of plagiarism" and marking a significant legal confrontation between Hollywood studios and AI firms [3][4]. Group 1: Lawsuit Details - The lawsuit, filed in federal district court in Los Angeles, accuses Midjourney of unauthorized use of Disney and Universal's intellectual property, including iconic characters like Darth Vader, Elsa, and Minions [4][5]. - The studios claim that Midjourney has generated high-quality reproductions of their characters without permission, using their copyrighted works to train its image generation service [4][6]. - Disney and Universal are seeking unspecified monetary damages and a preliminary injunction to prevent further infringement and to enforce copyright protections [8]. Group 2: Company Actions and Revenue - Prior to the lawsuit, Disney and Universal approached Midjourney regarding their copyright concerns, requesting the implementation of measures to prevent infringement, which Midjourney allegedly ignored [6][8]. - Midjourney reportedly generated $300 million in revenue last year through paid subscriptions, indicating a significant financial incentive for the company to continue its operations despite the legal challenges [7]. Group 3: Context of Legal Action - This lawsuit represents the first major legal battle between major entertainment studios and an AI company, following previous lawsuits from independent artists against Midjourney and other generative AI firms for similar copyright issues [3][8]. - A California federal judge previously ruled that artists had a plausible case against Midjourney and other AI companies for copying and storing their work, allowing litigation to proceed [8].