The Xbox Creator Who Compared New Boss to a 'Palliative Care Doctor' Doesn't Actually Think the Brand Is Dead

 

# The Xbox Creator Who Compared New Boss to a 'Palliative Care Doctor' Doesn't Actually Think the Brand Is Dead

**Published: February 25, 2026**

You know how sometimes you say something dramatic, and then you have to spend the next week explaining what you actually meant?

That's Seamus Blackley right now.

The man who co-created the original Xbox set the gaming world on fire over the weekend with a brutal take on Microsoft's leadership shakeup. He called the new Xbox head a "palliative care doctor" who would "slide Xbox gently into the night" . He said the brand was being "sunsetted" in favor of AI .

Fans panicked. Headlines exploded. Everyone started asking: is Xbox really dying?

Now Blackley is walking it back—sort of. In a series of emotional posts, he clarified that he doesn't actually think Xbox is dead. He loves the brand like his "own flesh and blood." Watching it struggle "kills me," he said .

So what's really going on here? Is Xbox in trouble, or is this just a founder getting emotional about changes at his old company?

Let me break down what Blackley actually said, why he's worried, and what it might mean for the future of Xbox.

---

## The Short Version

**Who is Seamus Blackley?** He's one of the original creators and designers of the first Xbox console, which launched in 2001. He left Microsoft a year later but has always stayed connected to the brand .

**What did he say that caused all the drama?** In an interview with GamesBeat, he said new Xbox CEO Asha Sharma's job is to be "a palliative care doctor who slides Xbox gently into the night." He claimed Xbox is being "sunsetted" because it's not part of Microsoft's core AI business .

**What's he saying now?** In follow-up posts on Bluesky, he clarified: "I have been asked 59 times now... if I believe [Xbox] is dead. No." He called Xbox "the most wonderful thing to me" and said "the distress it's in kills me, haunts me" .

**So what's the real story?** Blackley believes Xbox is in for major changes under Microsoft's AI-first strategy, but he doesn't think the brand will completely disappear. He's worried about what those changes might mean for games as art .

---

## The Leadership Shakeup That Started It All

Before we get into Blackley's comments, let's understand what triggered them.

Last week, Microsoft announced a massive shakeup in its gaming leadership:

**Table 1: Xbox Leadership Changes (February 2026)**

| **Who** | **Old Role** | **New Role** |

| :--- | :--- | :--- |

| Phil Spencer | Microsoft Gaming CEO | Retired after 30+ years |

| Sarah Bond | Xbox President | Resigned |

| Matt Booty | Game Content Head | Elevated to Chief Content Officer |

| Asha Sharma | CoreAI Product President | New Microsoft Gaming CEO |

**The surprise factor:** Sharma comes from Microsoft's AI division. She has no gaming industry background . This was a huge departure from Spencer, who was seen as a "gamer's gamer" with over 120,000 Gamerscore on his Xbox profile .

**Microsoft's official line:** Sharma promised "the return of Xbox" and said there would be no "soulless AI slop" in Xbox games . She said games "are and always will be art, crafted by humans" .

**The skepticism:** Blackley and others saw the appointment of an AI executive to run gaming as a clear signal of where Microsoft's priorities lie .

---

## The Interview That Set the Internet on Fire

In his interview with GamesBeat, Blackley didn't hold back. Here are the key quotes that got everyone talking.

**On why Sharma was appointed:**

"Satya Nadella has made an incredible number of bets and invested an incredible amount of money and credibility in the transform model AI future. Xbox, like a lot of businesses that aren't the core AI business, is being sunsetted. They don't say that, but that's what's happening" .

**On Sharma's role:**

"I expect that the new CEO, Asha Sharma, her job is going to be as a palliative care doctor who slides Xbox gently into the night" .

**On the logic:**

"I imagine asking somebody if it made sense to put a major motion picture studio into the hands of somebody who didn't like movies, or a major record label into the hands of somebody who'd never seen a live show. Why would you do that? Well, you only do that if you're looking at the problem in a more abstract way" .

**On the AI focus:**

"The natural consequence of the focus on AI is that AI abstracts every problem from the minds of the executives who believe in it. We're abstracting the problem of games as well. There's a core belief, and you can see it in what Satya said, that AI will subsume games like it will subsume everything" .

**On the clash between AI and art:**

"Microsoft is a company that is now about enabling its customers by enabling AI to drive things. That's at odds with the auteur model of any art, but specifically of games" .

**On games being different:**

"Microsoft doesn't have the problem that Apple does, or that Netflix does, where they have an auteur-driven content model to manage. Games are the only place where they have a content business" .

**On Sharma's promises:**

Blackley dismissed her statement about no "soulless AI slop" as "what every single person who's been brought into games from other industries has said when they're hired" .

---

## The Clarification: "No, I Don't Think Xbox Is Dead"

Within days, Blackley was on Bluesky trying to clarify his position. His follow-up posts reveal a more nuanced—and more emotional—take.

**On whether Xbox is dead:**

"I have been asked 59 times now, due to this [Dean Takahashi of GamesBeat] article, if I believe [Xbox] is dead. No" .

**On his love for the brand:**

"I love Xbox as my own flesh and blood. It's the most wonderful thing to me. The distress it's in kills me, haunts me. But progress requires introspection and realism. Learning is pain" .

**On how it feels to watch from the outside:**

"It's literally something I nearly died to bring into existence. Seeing it struggle and being unable to act is hard" .

**On being honest:**

"I love Xbox more than literally anyone. This is killing me. But I know a lot about organizations and business now, and I was being honest, not a PR asshole. Let's talk about it" .

So the picture that emerges is more complicated than the headlines suggested. Blackley isn't predicting that Xbox will vanish. He's predicting that it will change—and he's worried that the change will strip away what made it special.

---

## What Blackley Actually Thinks Will Happen

Reading between the lines, here's Blackley's real concern:

**Microsoft is all-in on AI.** CEO Satya Nadella has staked the company's future on generative AI. Every division is being pushed to incorporate AI into their products and strategies .

**Xbox is the odd one out.** Unlike Microsoft's other businesses, gaming is fundamentally about human creativity. It's an "auteur-driven" art form. You can't just plug AI into game development and expect the same results .

**Sharma's job is to bridge that gap.** She's not there to kill Xbox. She's there to figure out how to make Xbox fit into Microsoft's AI-first future. That means finding ways to use AI in game development, in Xbox services, and maybe in future hardware .

**The risk is real.** If Sharma approaches this as an abstract problem to be solved with technology, she could damage what makes Xbox special. If she succeeds in integrating AI without losing the human touch, Xbox could emerge stronger.

**Blackley's advice to Sharma:** In the same interview, he offered two pieces of advice:

1. "Leave this job soon" if she can't develop a genuine passion for games .

2. Go talk to gaming industry veterans like Shuhei Yoshida, Peter Moore, and Reggie Fils-Aimé. Learn from their successes and failures .

---

## What Xbox's Future Actually Looks Like

Stepping back from Blackley's comments, let's look at what we actually know about Xbox's future.

**A new console is coming.** Microsoft has confirmed plans for a next-generation Xbox, expected sometime in 2027 . That's not a company walking away from hardware.

**Games are still being made.** Major titles like Fable, the next Halo, and Call of Duty are still on track . Microsoft owns more game studios than almost anyone.

**The strategy is shifting.** Xbox has been putting more games on PlayStation and Nintendo Switch. Halo, Forza, and Gears of War are no longer exclusive . This has upset some fans, but it's also brought in more revenue.

**Game Pass is still growing.** The subscription service remains a core part of Xbox's strategy, even if growth has slowed.

**AI will play a role.** Microsoft has invested billions in AI. It's naive to think that won't affect Xbox. The question is how—and whether fans will accept it.

---

## The Bigger Question: Can AI and Gaming Coexist?

This is the real debate underlying all of this.

**Sharma's position:** In her statement, she said "AI has long been part of gaming and will continue to be." But she also promised that Xbox won't "chase short-term efficiency or flood our ecosystem with soulless AI slop" .

**Blackley's concern:** He sees AI as fundamentally at odds with the "auteur model" of game creation. Games are art, made by humans with passion and vision. AI optimizes for engagement and efficiency. Those two things don't naturally align .

**The industry's track record:** Every time a non-gaming executive has been brought in to "fix" a game company, it's usually gone badly. The gaming audience is notoriously sensitive to anything that feels corporate or soulless .

**The potential upside:** AI could help with technical tasks—playtesting, bug fixing, procedural content generation—freeing up human creators to focus on the creative parts. If Sharma can find that balance, it could work.

---

## What This Means for You

### If You're an Xbox Gamer

Your console isn't going to stop working. Your games aren't going to disappear. The next Xbox is still coming.

But you might notice changes over time. More games on other platforms. More AI features in Xbox services. Maybe games that feel different—for better or worse.

Pay attention to how Sharma's vision unfolds. If games start feeling generic or "optimized," that's a bad sign. If AI helps developers make better games without losing their soul, that's good.

### If You're an Investor

This leadership change is a signal. Microsoft is serious about integrating AI across all its businesses. That could create new opportunities—or alienate core customers.

Watch the reaction from gamers. Watch game quality. Watch subscription numbers. The market will tell you whether this strategy is working.

### If You're Just Curious

This is a fascinating case study in what happens when a tech giant's corporate strategy meets a creative industry. Microsoft is betting that AI can transform everything—including art. Whether they're right will tell us a lot about the future of technology and creativity.

---

## Frequently Asked Questions

**Q: Who is Seamus Blackley?**

A: He's one of the original creators and designers of the first Xbox console, which launched in 2001. He left Microsoft in 2002 but has remained connected to the gaming industry .

**Q: What did he say about the new Xbox CEO?**

A: He said Asha Sharma's job is to be "a palliative care doctor who slides Xbox gently into the night." He claimed Xbox is being "sunsetted" in favor of Microsoft's AI focus .

**Q: Does he actually think Xbox is dead?**

A: No. He clarified on Bluesky that he doesn't believe Xbox is dead. He said he loves the brand like "my own flesh and blood" and that "the distress it's in kills me" .

**Q: Why is he worried then?**

A: He's worried that Microsoft's AI-first strategy will change what makes Xbox special. Games are art, made by humans with passion. AI optimizes for efficiency. Those two things don't naturally align .

**Q: Who is Asha Sharma?**

A: She was Microsoft's CoreAI Product president before being appointed CEO of Microsoft Gaming. She has no gaming industry background, which raised eyebrows .

**Q: What has Sharma said about AI in gaming?**

A: She promised there would be no "soulless AI slop" in Xbox games and said games "are and always will be art, crafted by humans" . She also said "AI has long been part of gaming and will continue to be" .

**Q: What did Blackley think of those promises?**

A: He dismissed them as "what every single person who's been brought into games from other industries has said when they're hired" .

**Q: Is Xbox really going away?**

A: No. Microsoft has confirmed plans for a next-generation Xbox console in 2027 . Major games are still in development. Game Pass is still growing. The brand isn't disappearing.

**Q: What could change under Sharma?**

A: Expect more AI features in Xbox services, more games on other platforms, and maybe different approaches to game development. The core question is whether AI integration enhances or diminishes the gaming experience.

**Q: What advice did Blackley give Sharma?**

A: He suggested she should leave the job if she can't develop a genuine passion for games. He also urged her to talk to gaming industry veterans like Shuhei Yoshida, Peter Moore, and Reggie Fils-Aimé to learn from their experiences .

---

## The Bottom Line

Here's what I keep coming back to.

Seamus Blackley helped create Xbox. He literally almost died bringing it into existence . Watching it struggle from the outside is, in his words, "hard" and "kills me."

But he's not saying Xbox is dead. He's saying it's changing—and he's worried that the change will strip away its soul.

**Sharma's challenge** is to prove him wrong. To show that AI and art can coexist. To integrate new technology without losing what makes games special.

**Microsoft's bet** is that AI can transform every industry, including gaming. And they're putting one of their top AI executives in charge of proving it.

**The gaming community's role** is to hold them accountable. To reject soulless products and celebrate the ones made with passion.

Blackley's final words on the matter are worth remembering: "Progress requires introspection and realism. Learning is pain" .

Xbox might be in for some painful lessons. But that doesn't mean it's dying. It means it's evolving. Whether that evolution leads somewhere good—or somewhere terrible—is up to the people running it, the people making games for it, and the people playing them.

The next few years will tell us which way it goes.

---

*Got thoughts on Xbox's future? Worried about AI in gaming? Drop a comment and let me know.*

David Ellison Has a Rocky History at the Box Office. Buying Warner Bros. Could Fix That

 

# David Ellison Has a Rocky History at the Box Office. Buying Warner Bros. Could Fix That

**Published: February 25, 2026**

You know that feeling when you're really good at something, but you just can't seem to get over the hump?

That's David Ellison in a nutshell.

The man behind Paramount Skydance has produced some of the biggest movies of the past two decades. "Top Gun: Maverick." Five "Mission: Impossible" films. "World War Z." "Star Trek Into Darkness." His films have grossed billions at the global box office .

But here's the thing: his track record is all over the place. For every "Top Gun," there's a "Terminator Genisys" or a "Geostorm" that barely broke even. For every Tom Cruise blockbuster, there's a franchise that fizzled out or a budget that ballooned out of control .

Now Ellison is trying to buy Warner Bros. Discovery—one of the crown jewels of Hollywood, home to Batman, Harry Potter, and Game of Thrones. And if he succeeds, it could be the move that finally gives him the consistency he's been chasing for 20 years .

Let me walk you through Ellison's rocky history at the box office, why Warner Bros. is such a prize, and what this bidding war means for the future of entertainment.

---

## The Short Version

**Who is David Ellison?** The son of Oracle billionaire Larry Ellison. He dropped out of USC Film School, co-starred in a flop called "Flyboys" in 2006, and then used his family money to start Skydance Media .

**What's his track record?** Inconsistent. Massive hits like "Top Gun: Maverick" ($1.4 billion) alongside expensive disappointments like "Terminator: Dark Fate" ($250 million on a huge budget) .

**What's he trying to do now?** Buy Warner Bros. Discovery. He's been chasing this deal for almost six months, and just upped his offer to $31 per share—topping Netflix's $27.75 bid .

**Why would Warner Bros. fix his problems?** Warner has something Ellison lacks: consistent, bankable IP. Harry Potter, DC superheroes, Lord of the Rings. These are franchises that print money .

**The stakes:** If Ellison wins, he controls one of the most powerful studios in Hollywood. If Netflix wins, the streaming giant adds Warner's library to its empire. Either way, the industry changes forever.

---

## Who Is David Ellison?

Let's start at the beginning.

David Ellison is the son of Larry Ellison, the co-founder of Oracle and one of the wealthiest people on the planet. But being a billionaire's kid doesn't automatically make you a Hollywood player .

In 2006, Ellison dropped out of USC Film School to produce and co-star in "Flyboys," a World War I drama about American fighter pilots. The movie cost about $60 million to make. It grossed less than $18 million worldwide .

Not exactly a promising start.

But Ellison had something most aspiring producers don't: access to serious money. During the financial crisis of the late 2000s, when traditional investment banks were pulling out of Hollywood, Ellison stepped up. In 2009, he struck a four-year, $350 million co-financing deal with Paramount Pictures .

That deal gave him a stake in some of Paramount's biggest franchises: "Mission: Impossible," "Star Trek," and prestige projects like the Coen Brothers' "True Grit." It was a smart move—get involved with proven properties rather than trying to build from scratch.

Over the next decade, Ellison's Skydance would produce an impressive list of films :

**Table 1: Selected Skydance Productions**

| **Year** | **Title** | **Role** |

| :--- | :--- | :--- |

| 2010 | True Grit | Executive Producer |

| 2011 | Mission: Impossible—Ghost Protocol | Executive Producer |

| 2012 | Jack Reacher | Executive Producer |

| 2013 | Star Trek Into Darkness | Executive Producer |

| 2013 | World War Z | Executive Producer |

| 2014 | Jack Ryan: Shadow Recruit | Executive Producer |

| 2015 | Terminator: Genisys | Producer |

| 2015 | Mission: Impossible—Rogue Nation | Producer |

| 2017 | Life | Producer |

| 2018 | Mission: Impossible—Fallout | Producer |

| 2019 | Terminator: Dark Fate | Producer |

| 2022 | Top Gun: Maverick | Producer |

| 2023 | Mission: Impossible—Dead Reckoning Part One | Executive Producer |

| 2025 | Mission: Impossible—The Final Reckoning | Producer |

That's an impressive resume. But as we're about to see, the numbers tell a more complicated story.

---

## The Box Office Roller Coaster

Let's look at the actual numbers, because this is where Ellison's story gets interesting.

**Table 2: Skydance's Highest-Grossing Films Globally **

| **Title** | **Year** | **Worldwide Box Office** |

| :--- | :--- | :--- |

| Top Gun: Maverick | 2022 | $1.4 billion |

| Mission: Impossible—Fallout | 2018 | $791 million |

| Mission: Impossible—Ghost Protocol | 2011 | $694 million |

| Mission: Impossible—Rogue Nation | 2015 | $682 million |

| Mission: Impossible—The Final Reckoning | 2025 | $599 million |

| Mission: Impossible—Dead Reckoning Part One | 2023 | $571 million |

| World War Z | 2013 | $540 million |

| Star Trek Into Darkness | 2013 | $467 million |

| Transformers: Rise of the Beasts | 2023 | $441 million |

| Terminator Genisys | 2015 | $440 million |

Look at that list carefully. Six of the top seven are Tom Cruise movies. The man is basically Ellison's lucky charm.

But here's the problem: grosses don't tell the whole story. Profit matters more, and that's where Ellison has struggled.

Take "Mission: Impossible—The Final Reckoning." It grossed $599 million globally—the fourth-best showing in the franchise. Sounds great, right? Except the film had a reported budget of **$400 million**. Add marketing costs of roughly $200 million, and the total investment was around $600 million .

Studios share box office proceeds with theater operators, typically ending up with about 50% of the gross. So on $599 million, Paramount and Skydance would have taken home roughly $300 million—half of what they spent .

That's not a profit. That's a loss.

**Paul Dergarabedian**, head of marketplace trends at Comscore, explains the challenge: "The challenge for Ellison and Skydance, as it is for every studio, production company, and distributor, is to keep budgets in line particularly for latter installments of major franchises as these tend to have diminishing returns as compared the earlier releases to justify the continued investment in these movie franchises" .

And unlike Marvel or Star Wars, the "Mission: Impossible" franchise doesn't have a massive merchandising business to fall back on. No toys. No action figures. No theme park rides. Just ticket sales .

**Shawn Robbins**, director of analytics at Fandango, puts it bluntly: "Paramount is looking to mine every opportunity it can following the recent conclusion of Tom Cruise's Mission: Impossible series, the regression of Transformers from its biggest blockbuster dollar days, and the cinematic dormancy of Star Trek as that brand has been re-focused toward multiple streaming series" .

In other words: Ellison's biggest hits are behind him, and the franchises he's relied on are running out of steam.

---

## The Warner Bros. Prize

So why is Ellison so desperate to buy Warner Bros. Discovery?

Because Warner has what he doesn't: **a mountain of consistent, bankable intellectual property**.

**Table 3: Warner Bros. Discovery's Major Franchises **

| **Franchise** | **What It Includes** |

| :--- | :--- |

| DC Universe | Superman, Batman, Wonder Woman, Aquaman |

| Harry Potter/Wizarding World | 8 films, Fantastic Beasts, theme parks |

| Lord of the Rings | The Hobbit, upcoming films |

| Game of Thrones | Multiple series, potential films |

| Looney Tunes | Bugs Bunny, Daffy Duck, etc. |

| Scooby-Doo | Decades of content |

| Legendary partnerships | Dune, Godzilla, King Kong |

**Warner Bros. was the second-highest grossing studio at the domestic box office last year**. Paramount was fourth .

"Dergarabedian puts it this way: "Warner Bros. is one of the crown jewels of the theatrical distribution. Their slate of films, filmmaker relationships, brand recognition, and reputation as one of the premier and iconic movie studios makes them a coveted asset by any player in the entertainment space" .

For Ellison, buying Warner Bros. would mean:

1. **Diversification away from Tom Cruise.** No more relying on one star to carry his business.

2. **Consistent revenue streams.** Harry Potter and DC movies print money when done right.

3. **Scale.** Combining Paramount and Warner would create a studio bigger than market leader Disney in some respects .

4. **Streaming power.** HBO Max plus Paramount+ would create a serious competitor to Netflix and Disney+ .

5. **Prestige.** Warner Bros. has been making movies for over 100 years. That brand recognition is invaluable.

---

## The Bidding War: Where Things Stand

This deal has been in the works for months. Here's where we are right now.

**Table 4: The Competing Bids **

| **Bidder** | **Offer** | **What They Want** |

| :--- | :--- | :--- |

| Netflix | $27.75/share (~$82.7 billion) | Studio and streaming assets only; cable networks spun off |

| Paramount Skydance | $31/share (~$108.4 billion+) | Entire company, including CNN and cable networks |

**Key dates:**

- Warner's board is reviewing the new Paramount offer

- If they deem it superior, Netflix gets four days to match 

- Shareholders were scheduled to vote on the Netflix deal March 20, but that could change 

**The politics:** This has gotten messy. Netflix co-founder Reed Hastings supports Democrats. Larry Ellison (David's dad) is aligned with President Trump. If Paramount wins, CNN—which Trump has spent years attacking—would end up under Ellison family control .

**The theater owner angle:** Cinema owners are terrified of a Netflix deal because the streamer has a rocky history with theatrical releases. They're more comfortable with Ellison, who has promised to release more than 30 movies a year .

**The regulatory angle:** Both deals face intense scrutiny. The Justice Department is already investigating. A bipartisan group of senators has raised concerns about consolidation .

---

## What This Means for You

### If You're a Movie Fan

This deal matters a lot. Warner Bros. has been making movies for over a century. Casablanca. The Exorcist. Batman. Harry Potter. The future of that studio—and the people who work there—is in play.

If Ellison wins, expect a continued commitment to theatrical releases. He's said all the right things about the big-screen experience.

If Netflix wins? That's less certain. Ted Sarandos has promised to keep releasing Warner movies in theaters, but his track record is spotty. Theater owners are skeptical .

### If You're a Streamer

Your options might change. A combined Warner-Paramount would put HBO Max and Paramount+ under one roof. That's a lot of content in one place.

A Netflix-Warner combo would make Netflix even more dominant, adding the Warner library to an already massive catalog.

### If You're an Investor

This is a classic "merger arbitrage" situation. The outcome is binary: either Netflix wins or Paramount wins. The stock prices of all three companies will move based on news and rumors.

Warner's stock has already jumped on the bidding war. Paramount's stock moved too. If you're brave (and have a high risk tolerance), you could play the spread. But this is not for beginners.

---

## The Bigger Question: Can Ellison Pull It Off?

Here's what I keep coming back to.

David Ellison has spent 20 years in Hollywood, and his track record is... fine. Not great. Not terrible. Fine. He's had massive hits and expensive flops. He's proven he can produce movies, but he hasn't proven he can run a studio .

Warner Bros. is a different beast entirely. It's not just about making movies—it's about managing thousands of employees, navigating complex distribution deals, dealing with talent, and keeping a massive library of intellectual property humming.

**Shawn Robbins** puts it in perspective: "Paramount's box office market share has often been challenged to keep pace with competitors and its own peak performance in the years leading up to 2015. While occasional hits such as the Sonic, A Quiet Place, and Scream franchises have provided bright spots, plus 'Top Gun: Maverick' catching lightning in a bottle four years ago, some of the studio's most bankable IP has seen diminishing returns among modern moviegoers" .

Translation: Even with Skydance's success, Paramount has been struggling. Adding Warner Bros. doesn't automatically fix that.

But here's the counterargument: Warner Bros. has the IP that Paramount lacks. Harry Potter fans will show up regardless of who's running the studio. DC movies, when done right, are guaranteed money. Game of Thrones spin-offs have built-in audiences.

For Ellison, buying Warner Bros. isn't just about adding assets. It's about buying consistency. It's about diversifying away from Tom Cruise. It's about finally having the kind of stable, predictable revenue that has eluded him for two decades .

**Paul Dergarabedian** sums it up: "If a merger were to be approved, the entity that then grabs up Warner Bros. would add tremendous horsepower both in terms of brand identity and revenue generating potential to their portfolio. So, it is understandable why the competition is fierce among the potential suitors vying for their chance to acquire the studio" .

---

## Frequently Asked Questions

**Q: Who is David Ellison?**

A: He's the CEO of Paramount Skydance, son of Oracle billionaire Larry Ellison, and a longtime Hollywood producer. His credits include "Top Gun: Maverick" and five "Mission: Impossible" films .

**Q: What's his box office track record?**

A: Inconsistent. Massive hits like "Top Gun: Maverick" ($1.4 billion) alongside expensive disappointments like "Terminator: Dark Fate" and "Geostorm." Many of his franchise films have struggled with ballooning budgets and diminishing returns .

**Q: Why is he trying to buy Warner Bros.?**

A: Warner Bros. has something he lacks: consistent, bankable IP. Harry Potter, DC superheroes, Lord of the Rings—these are franchises that print money and don't rely on any single star .

**Q: What's the latest on the bidding war?**

A: Paramount just raised its offer to $31 per share, topping Netflix's $27.75 bid. Warner's board is reviewing it now. If they deem it superior, Netflix gets four days to match .

**Q: What's the difference between the two bids?**

A: Paramount wants to buy all of Warner Bros. Discovery, including cable networks like CNN. Netflix only wants the studio and streaming assets, with the cable networks getting spun off .

**Q: How much money are we talking about?**

A: Paramount's bid values Warner at over $108 billion including debt. Netflix's bid is about $82.7 billion .

**Q: What does this mean for movie theaters?**

A: Theater owners are terrified of a Netflix deal because of the streamer's rocky history with theatrical releases. They're more comfortable with Ellison, who has promised to release over 30 movies a year .

**Q: What does this mean for CNN?**

A: If Paramount wins, CNN would end up under the Ellison family's control. Given Larry Ellison's alignment with President Trump, that's raised eyebrows in Washington .

**Q: When will we know who wins?**

A: Warner's board is reviewing the Paramount offer now. If they deem it superior, Netflix gets four days to respond. A shareholder vote was scheduled for March 20, but that could change .

**Q: Will regulators approve this?**

A: That's a huge question mark. Both deals face intense scrutiny from the Justice Department, the EU, and UK regulators. A bipartisan group of senators has raised concerns about consolidation .

---

## The Bottom Line

Here's what I keep coming back to.

David Ellison has spent two decades in Hollywood, and his track record is a mixed bag. For every "Top Gun: Maverick," there's a "Terminator: Dark Fate." For every Tom Cruise blockbuster, there's a franchise that fizzled out or a budget that spiraled out of control.

But Warner Bros. could change all that.

With Harry Potter, DC, and Lord of the Rings in his stable, Ellison wouldn't have to rely on any single star or franchise. He'd have a library of IP that's been printing money for decades—and will keep printing money for decades to come.

**Shawn Robbins** puts it in perspective: "Paramount is looking to mine every opportunity it can following the recent conclusion of Tom Cruise's Mission: Impossible series, the regression of Transformers from its biggest blockbuster dollar days, and the cinematic dormancy of Star Trek" .

In other words: Ellison's current well is running dry. He needs new sources of water. Warner Bros. is an ocean.

Whether he can actually pull off this deal—and whether he can run the combined company successfully—remains to be seen. The bidding war isn't over. Netflix could still match or beat his offer. Regulators could block the whole thing. Integration could be a nightmare.

But for the first time in his career, Ellison is within striking distance of the kind of consistent, stable success that has eluded him for 20 years.

The next few weeks will tell us whether he gets there.

---

*Got thoughts on the bidding war? Think Ellison can pull it off? Drop a comment and let me know.*

Nvidia Stock Dips on AMD-Meta Deal, But Wall Street Still Bullish Ahead of Earnings

 

# Nvidia Stock Dips on AMD-Meta Deal, But Wall Street Still Bullish Ahead of Earnings

**Published: February 25, 2026**

You know that feeling when you're the star of the show, and suddenly someone else gets a big round of applause?

That's kind of what happened to Nvidia this week.

The chip giant's stock took a small hit—down about 1%—after rival AMD announced a blockbuster deal with Meta worth up to $60 billion over five years . Investors got a little nervous. Competition is heating up. Maybe Nvidia's iron grip on the AI chip market isn't quite as tight as we thought.

But here's the thing: Wall Street isn't panicking. Not even close.

With Nvidia set to report earnings after the close today, analysts are raising price targets, talking about $2 billion upside surprises, and predicting the stock could hit $275 or even $352 . The bulls are still in charge.

So what's really going on? Is the AMD deal a real threat, or just noise? And what should investors expect when Nvidia drops its numbers later today?

Let me walk you through it all in plain English.

---

## The Short Version

**What happened:** AMD announced a deal to sell up to $60 billion worth of AI chips to Meta over five years . The deal includes warrants that could give Meta up to 10% of AMD's stock .

**How Nvidia reacted:** Stock dipped about 1%, part of a broader tech pullback .

**Why it matters:** Meta is one of Nvidia's biggest customers. If they're buying more from AMD, does that mean less for Nvidia? That's the question investors are wrestling with.

**The bigger picture:** Nvidia reports earnings today. Analysts expect a monster quarter—$65.6 billion in revenue, up from $39.3 billion a year ago . And they're still bullish, with price targets as high as $352 .

**The bottom line:** One deal doesn't change Nvidia's dominance. But it's a reminder that competition is real, and customers want options.

---

## The AMD-Meta Deal: What You Need to Know

Let's start with the news that moved markets.

On Tuesday, AMD announced a massive expansion of its partnership with Meta. The deal runs for five years and covers up to $60 billion worth of AI chips . That's not pocket change.

**Table 1: The AMD-Meta Deal at a Glance**

| **Metric** | **Details** |

| :--- | :--- |

| Total value | Up to $60 billion over 5 years |

| Compute capacity | 6 gigawatts worth of chips |

| First delivery | 1 gigawatt of MI450 chips in H2 2026 |

| Stock warrants | Meta can buy up to 160M AMD shares at $0.01 |

| Potential ownership | Up to 10% of AMD if all milestones hit |

| Custom chips | AMD will design specialized CPUs for Meta |

**Why the warrants matter:** This is the really interesting part. AMD is essentially giving Meta a huge incentive to make this deal work. The stock warrants are tied to performance milestones—both in terms of chip deliveries and AMD's stock price hitting targets up to $600 .

If everything goes perfectly, Meta could end up owning about 10% of AMD . That's not just a customer relationship. That's a partnership.

**Matt Britzman**, an analyst at Hargreaves Lansdown, put it this way: "Meta is locking in supply, diversifying away from a single vendor, and doing whatever it takes to make sure its AI ambitions aren't bottlenecked by chips" .

For AMD, he said, "this is a vote of confidence in its next-generation AI hardware—but having to give up a 10% stake suggests it could be struggling to generate organic demand" .

**Lisa Su**, AMD's CEO, was more optimistic: "Meta is making a big bet on AMD" . She noted that the chips are optimized for "inference"—the process of running AI models after they're trained, which is expected to be an even bigger market than training .

---

## The Nvidia Reaction: Why the Dip?

So if AMD's deal is so great for them, why did Nvidia's stock dip?

A few reasons.

**First, investors worry about share loss.** Meta is one of Nvidia's biggest customers. If they're spending billions with AMD, maybe they're spending less with Nvidia. That's a legitimate concern, even if it's not the full story.

**Second, it's a reminder that competition exists.** Nvidia has dominated the AI chip market, but AMD is clearly gaining traction. They signed a similar deal with OpenAI last year . Now Meta. That's two of the biggest names in AI choosing AMD for at least part of their needs.

**Third, the market is on edge.** Nvidia reports earnings today. Any negative news—even a 1% dip—gets amplified when everyone's waiting for the big number.

But here's the important context: **Nvidia's stock is still up 41% over the past year** . It's trading around $191, down from its October peak of $212, but still way above where it was . One deal with AMD doesn't change that trajectory.

---

## What the Analysts Are Saying

This is where it gets interesting. Despite the AMD news, Wall Street is overwhelmingly bullish on Nvidia heading into earnings.

**Table 2: Analyst Price Targets for Nvidia**

| **Firm** | **Analyst** | **Rating** | **Price Target** |

| :--- | :--- | :--- | :--- |

| Morgan Stanley | Joseph Moore | Overweight | $250 |

| Bank of America | Vivek Arya | Buy | $275 |

| KeyBanc | John Vinh | Overweight | $275 |

| DA Davidson | Gil Luria | Buy | $250 |

| Wedbush | Matt Bryson | Outperform | $230 |

| Street consensus | 39 analysts | Strong Buy | $255.82 |

**Morgan Stanley's Joseph Moore** is particularly bullish. He expects strong Q4 results and has "very high confidence" that Nvidia will perform well for the full year . He's projecting at least $2 billion in upside to the company's $64 billion guidance, saying a consensus revenue estimate of $72 billion "feels safe" .

Moore's target of $250 is based on 26 times his 2027 EPS estimate of $9.57 . He thinks Nvidia should trade at a premium to Broadcom given its "higher probability of upward revisions in the near term" .

**Bank of America's Vivek Arya** is even more optimistic at $275, based on 28 times his 2027 P/E estimate . He recently raised his sales and EPS estimates for Nvidia.

**KeyBanc's John Vinh** sees strong results driven by Blackwell shipments and H200 sales to China, which he estimates could contribute $3 billion to $3.5 billion in revenue this quarter .

**The Street consensus** from 39 analysts is a "Strong Buy" with an average price target of $255.82—about 33% upside from current levels .

---

## What to Watch in Nvidia's Earnings

Nvidia reports after the market close today. Here's what everyone will be watching.

### 1. The headline numbers

Analysts expect $65.6 billion in revenue and $1.52 in EPS . That's up from $39.3 billion and $0.89 a year ago .

The company's own guidance called for $63.7 billion to $66.3 billion , so they're already projecting massive growth.

### 2. Guidance

As always with Nvidia, the future matters more than the past. The company has a history of "beat and raise"—crushing expectations and then lifting guidance even higher .

**Investing.com** notes that "meeting" expectations probably won't be enough . The "whisper number" is higher than the official estimates, and investors want to see that demand is still accelerating.

### 3. The Blackwell ramp

Nvidia's next-gen Blackwell chips are critical. Analysts want to hear that production is on track and demand is strong. KeyBanc's Vinh expects "increasing shipments of Blackwell Ultra to be a key driver of strong results and guidance" .

### 4. Data center diversity

The market will focus on whether data center growth is broad-based or concentrated in a few hyperscalers. If Nvidia can show demand from enterprise, sovereign AI, and other sources beyond the big tech companies, that's a huge positive .

### 5. Gross margins

Nvidia's margins are already incredible—over 70% . But any hint of pressure, whether from competition or product mix, could spook investors. The question is whether margin pressure is "transitory" (temporary as new products ramp) or "structural" (a new normal) .

### 6. China exposure

There's an interesting twist here: US export policy has quietly changed. Nvidia's H200 shipments to China are no longer under automatic denial, but subject to case-by-case review . KeyBanc estimates this could represent $3 billion to $3.5 billion in revenue this quarter .

---

## The Competition Question: How Real Is the Threat?

Let's address the elephant in the room. Is AMD actually a threat to Nvidia?

**The short answer:** Yes, but not an existential one.

**Nvidia's moat is real.** They dominate AI training through their CUDA software platform, where most foundational AI code has been written and optimized for their GPUs . That's not something AMD can replicate overnight.

**But inference is different.** Running AI models after they're trained is a different kind of computing, and Nvidia's moat is narrower there . AMD's MI450 chips are specifically optimized for inference, and Meta helped design them .

**The inference market could be huge.** Industry analysts expect the market for inference hardware to dwarf the size of the market for training equipment . If AMD can carve out a meaningful share of that, it's real money.

**Broadcom is also in the mix.** Some analysts think Broadcom could be the biggest winner in inference, thanks to its custom ASIC chips for companies like Google and OpenAI . The Nasdaq article we looked at predicted Broadcom would be the "new AI inference king" by year-end .

**The bottom line:** Nvidia will remain dominant, but it won't have 90% market share forever. That's normal. That's healthy. And it doesn't mean Nvidia can't be a great investment.

---

## The Technical Picture: What the Charts Say

For the chart watchers out there, here's where Nvidia stands technically.

The stock has been trading in a range between about $170 and $195 for over six months . There was a brief move above $200 in early November, but it didn't hold .

**Bulls say:** This consolidation has allowed the stock to digest its massive run-up without a sharp correction. It's "correcting through time rather than price," which is healthy.

**Bears say:** This is a topping pattern, and the stock could break down if earnings disappoint.

Options pricing suggests traders expect about a 5.5% move in either direction after earnings . That's down from the 10% moves we saw last year, but still significant for a $4.7 trillion company .

**Key levels to watch:**

- **Resistance:** $195-$200 (the top of the range)

- **Support:** $170-$175 (the bottom of the range)

- **Breakout level:** Above $210 would signal new highs

- **Breakdown level:** Below $170 would suggest deeper pullback to the mid-$100s

---

## What This Means for You

### If You're an Investor

Today's earnings are a big deal. Nvidia is the poster child for AI, and how it performs sets the tone for the whole sector.

If they deliver a strong beat and raise guidance, the stock could break out of its range and challenge all-time highs. If they disappoint, expect volatility.

But here's the important thing: even with competition heating up, Nvidia is still the dominant player in the most important technology of our time. One AMD deal doesn't change that.

### If You're Thinking About Buying

The stock is down from its highs and trading in a range. That's not necessarily a bad entry point, but earnings could provide clearer direction.

Some analysts think the stock is "discounting a 2026 peak in AI demand" , meaning the market may already be pricing in a slowdown. If that's wrong, there could be upside.

### If You're Just Curious

This is a fascinating moment in tech. We're watching the biggest infrastructure buildout in history—$650 billion in AI spending this year alone from the big cloud companies . And at the center of it all is Nvidia.

Whether you own the stock or not, what happens today matters. It's a signal for the whole AI trade.

---

## Frequently Asked Questions

**Q: Why did Nvidia stock fall after the AMD-Meta deal?**

A: The stock dipped about 1% on concerns that Meta might shift some spending away from Nvidia. Investors worry about competition, even if the actual impact is small .

**Q: How big is the AMD-Meta deal?**

A: Up to $60 billion over five years, covering 6 gigawatts of compute capacity. Meta also gets warrants that could give them up to 10% of AMD's stock .

**Q: Is this a real threat to Nvidia?**

A: It's a reminder that competition exists, but Nvidia's dominance isn't going away overnight. AMD is gaining traction in inference chips, but Nvidia still dominates training and has a massive software moat .

**Q: When does Nvidia report earnings?**

A: Today, February 25, after market close .

**Q: What are analysts expecting?**

A: Revenue of $65.6 billion, EPS of $1.52 . Guidance is also critical—investors want to see that demand is still accelerating .

**Q: What's the stock price target for Nvidia?**

A: The consensus from 39 analysts is $255.82, about 33% upside from current levels . Individual targets range from $230 to $352 .

**Q: What's the difference between training and inference?**

A: Training is building the AI model—teaching it to recognize patterns. Inference is running the model—answering queries, generating content. Inference is expected to be a much bigger market long-term .

**Q: Who else competes with Nvidia?**

A: AMD is the main GPU competitor. Broadcom is big in custom ASIC chips for companies like Google. And some hyperscalers are developing their own chips .

**Q: Should I buy Nvidia stock before earnings?**

A: That's a personal decision. The stock could move 5-6% either way after earnings. If you're long-term bullish, dollar-cost averaging might make more sense than trying to time the announcement.

**Q: What happens if Nvidia misses?**

A: Expect a sharp selloff, and probably a pullback in the whole AI sector. But given Nvidia's track record of beating expectations, a miss seems unlikely .

---

## The Bottom Line

Here's what I keep coming back to.

The AMD-Meta deal is real. It's big. It shows that Nvidia's customers want options and are willing to invest billions to create them.

But Nvidia is still the king. They're reporting another monster quarter today. Their margins are insane. Their technology is years ahead. And their customers are spending hundreds of billions on AI infrastructure—most of it on Nvidia chips.

**Morgan Stanley's Joseph Moore** put it well: he has "very high confidence" that Nvidia will perform well, and he sees $2 billion in potential upside to guidance .

**DA Davidson's Gil Luria** offered a contrarian take that's actually bullish: "The market has picked other AI winners... While these other companies' expectations are discounting a multi-year AI cycle, we believe that NVDA's share price is discounting a 2026 peak in AI demand" .

In other words: everyone's excited about other AI plays, but Nvidia might actually be the bargain because expectations are lower.

Whether you agree with that or not, one thing is clear: Nvidia is still the most important company in the most important technology on earth. And today's earnings will tell us a lot about where we go from here.

Buckle up.

---

*Got thoughts on Nvidia earnings? Think AMD is a real threat? Drop a comment and let me know.*

The $159 Billion Elephant in the Room: Is Stripe Really Eyeing a Deal for PayPal?

 

# The $159 Billion Elephant in the Room: Is Stripe Really Eyeing a Deal for PayPal?

**Published: February 25, 2026**

You know that feeling when you hear a rumor so big, so unexpected, that you just have to stop and say... wait, what?

That's what happened in the payments world this week.

According to Bloomberg, Stripe—the ultra-hot, privately held fintech darling valued at $159 billion—is considering buying all or parts of PayPal, the struggling pioneer that helped invent online payments as we know them .

The news sent PayPal stock up nearly 7% on Tuesday, adding to a 5.8% jump from the day before . Investors are clearly excited about the possibility. But here's the thing: the talks are reportedly "early" and "there's no certainty they will lead to a transaction" .

So what's really going on? And would a deal like this even make sense?

Let me walk you through what we know, what the experts are saying, and what it might mean for both companies—and for anyone who's ever used PayPal, Venmo, or Stripe.

---

## The Short Version

**What happened:** Bloomberg reported that Stripe, the $159 billion payments infrastructure giant, is in "preliminary discussions" about acquiring all or parts of PayPal .

**How PayPal reacted:** Stock jumped nearly 7% on Tuesday, following a 5.8% gain Monday . That's a pretty clear vote of confidence from investors who think a deal could unlock value.

**The numbers:** PayPal's market cap is about $43 billion . Stripe's valuation is nearly four times that at $159 billion . So size-wise, it's feasible .

**What Stripe's founder said:** Patrick Collison acknowledged PayPal has "had a tough time over the past few years" but wouldn't comment on M&A speculation .

**Why it matters:** This would be one of the biggest fintech deals in history, potentially reshaping the entire payments landscape.

---

## The Two Giants: A Tale of Two Trajectories

Before we dive into the deal talk, let's understand who we're talking about.

### PayPal: The Pioneer That Lost Its Way

PayPal was founded in the late 1990s and basically invented online payments . It survived the dot-com crash, went public, got bought by eBay, then spun out again in 2015. For years, it was the undisputed king of digital payments.

But lately? It's been a rough ride.

**The numbers tell the story:** PayPal's stock hit an all-time high near $310 in 2021 . Today, it's around $47 . That's not a correction—that's a collapse.

**What went wrong?** A few things:

- **Big Tech competition:** Apple Pay and Google Pay have eaten into PayPal's dominance . When you can check out with Face ID on your iPhone, why log into PayPal?

- **Slow to modernize:** Critics say PayPal struggled to update its technology while nimbler competitors raced ahead .

- **Leadership turmoil:** The company just ousted CEO Alex Chriss earlier this month, saying the "speed of transformation and execution... had fallen short of its expectations" . Enrique Lores takes over March 1 .

- **Weak earnings:** Fourth-quarter profit and revenue missed estimates, with payment volume growth slowing .

**Bernstein analyst Harshita Rawat** values the pieces of PayPal like this :

**Table 1: What PayPal's Parts Are Worth (Per Bernstein)**

| **Asset** | **Estimated Value** |

| :--- | :--- |

| Braintree unit | $10–$15 billion |

| Venmo | ~$5 billion |

| Core PayPal business | $20–$25 billion |

Add it up, and you're in the $35–$45 billion range—roughly where PayPal trades today.

### Stripe: The Hotshot Upstart

Stripe, founded by Irish brothers Patrick and John Collison, has become the most coveted name in fintech . They provide the behind-the-scenes payment infrastructure for countless online businesses—think of them as the plumbing for the internet economy.

**Key facts about Stripe :**

- **Valuation:** $159 billion, up from $91 billion just a year ago

- **Revenue Suite:** On track to hit $1 billion in annualized revenue this year

- **Total payment volume:** Roughly $1.4 trillion 

- **Status:** Privately held, no immediate IPO plans (Collison says going public would distract from product focus) 

**What makes Stripe different?** They've built their business around developers and businesses, not consumers. If you've ever bought something online and seen a smooth checkout experience, there's a good chance Stripe was behind it.

But here's the interesting gap: Stripe doesn't have much of a consumer presence. You don't have a Stripe wallet or a Stripe app on your phone. That's where PayPal comes in .

---

## Why Would Stripe Want PayPal?

This is the billion-dollar question. Let's look at the strategic logic.

### The Braintree Angle

**Mizuho analyst Dan Dolev** points out that Stripe already processes about $1.4 trillion in payments . Acquiring PayPal's Braintree unit would add roughly **$700 billion** in additional volume.

That's not just incremental growth—it's a massive leap in scale that would strengthen Stripe's position against competitors like Adyen .

### The Consumer Gap

Here's something interesting: Stripe is a B2B powerhouse, but it lacks what analysts call "last-mile visibility" with consumers . They don't have a consumer brand or a wallet in your pocket.

PayPal, on the other hand, is one of the few globally recognized consumer payment networks . And then there's Venmo—widely considered the most powerful peer-to-peer payment brand out there, especially among younger users .

Imagine Stripe's backend infrastructure combined with PayPal and Venmo's frontend consumer reach. That's a formidable combination.

### The Stablecoin Play

Here's a forward-looking angle: Dolev suggests that together, Stripe and PayPal "could become a meaningful stablecoin player" as these digital currencies become more important in global commerce .

That's not just about today's business—it's about positioning for the future of money.

---

## What the Analysts Are Saying

Wall Street has been busy chewing on this news. Here's what the experts think.

**Table 2: Analyst Takes on a Potential Stripe-PayPal Deal**

| **Analyst/Firm** | **Key Point** |

| :--- | :--- |

| Dan Dolev, Mizuho | Deal is "feasible from a size perspective" given Stripe's $159B valuation vs. PayPal's $43B market cap . Sees strategic logic in combining Stripe's B2B strength with PayPal's consumer reach. |

| Harshita Rawat, Bernstein | Speculated Stripe could be interested in Braintree ($10-15B) even before buyer was named. Also flagged JPMorgan, private equity, Revolut, and Amex as potential suitors . |

| Madison Suhr, Raymond James | Thinks a full sale is unlikely given the massive price tag (over $50B). But a buyer could target high-growth assets like Venmo . |

**The valuation disconnect** is worth noting. Mizuho's Dolev points out that PayPal trades at just **7x forward earnings** for 2027, far below its five-year average of 20x . That's either a screaming bargain or a value trap—depending on who you ask.

---

## The Challenges: Why a Deal Might Not Happen

For all the excitement, there are some serious hurdles.

**1. It's early.** Like, really early. The discussions are "preliminary" and there's "no certainty they will lead to a transaction" . This could easily go nowhere.

**2. Regulatory scrutiny.** Any deal of this size would face intense antitrust review. The combined company would be a payments behemoth.

**3. Integration risk.** Merging two massive companies with different cultures, technologies, and customer bases is brutally hard. Tech M&A is littered with failures.

**4. Stripe's focus.** Patrick Collison has said an IPO would distract from product focus . A massive acquisition would be even more distracting.

**5. PayPal's complexity.** It's not just one business—it's Braintree, Venmo, the core PayPal wallet, and more. Untangling what Stripe would want and what would be left behind is messy.

**6. The price tag.** Even at $43 billion, this would be one of the largest fintech acquisitions ever. And PayPal's board might push for a premium on top of that.

---

## What Both Companies Are Saying

Officially? Not much.

**Stripe's response:** "Declined to comment" .

**PayPal's response:** "Declined to comment" .

**Patrick Collison, Stripe president** (in an interview this week): "PayPal has had, obviously, a tough time over the past few years and the landscape has changed quite a bit with Apple Pay and Google Pay and everything like that. I can't talk about any, you know, merger and acquisition hypotheticals but they have definitely had a tough time" .

That's not a denial. But it's not a confirmation either.

---

## What This Means for You

### If You're a PayPal User

Honestly, probably not much in the short term. These are early talks. Even if a deal happens, your PayPal and Venmo accounts would keep working.

Longer term? A combined Stripe-PayPal could mean smoother payments, better integration, and maybe some cool new features. But that's years away, if ever.

### If You're a Stripe User

Same story. Your business would keep running on Stripe's infrastructure. If they acquired PayPal, you might eventually see new capabilities—like access to Venmo's user base—but nothing immediate.

### If You're an Investor

This is where it gets interesting.

PayPal's stock has been crushed. It's trading at historically low multiples. If you believe a deal could happen—or that other buyers might emerge—there could be upside.

But here's the caution: the stock jumped nearly 13% over two days on this news . That's a lot of optimism priced in already.

**Raymond James analyst Madison Suhr** thinks a full sale is unlikely, but notes that "buyers may be interested in high-growth assets such as Venmo" . So maybe the real action is in piecemeal deals, not a full acquisition.

---

## The Bigger Picture: What This Says About Fintech

Stepping back, this rumored deal tells us something about where the payments industry is heading.

**The winners and losers are getting sorted out.** Stripe is on top—growing fast, highly valued, picking its shots. PayPal is struggling—losing share, changing leadership, trading at distressed levels.

**Scale matters.** In payments, bigger is often better. More volume means better data, better pricing, better economics. A combined Stripe-PayPal would be a true powerhouse.

**Consumer relationships are valuable.** Stripe's lack of consumer presence is a real gap. PayPal and Venmo fill that perfectly.

**The next wave is coming.** Stablecoins, crypto, new payment rails—the future of money is being built now. The companies that control both infrastructure and consumer access will be well positioned.

---

## Frequently Asked Questions

**Q: Is Stripe definitely buying PayPal?**

A: No. The talks are "preliminary" and "there's no certainty they will lead to a transaction" . This could easily go nowhere.

**Q: How much would a deal cost?**

A: PayPal's market cap is about $43 billion . Any acquisition would likely require a premium on top of that, so probably over $50 billion.

**Q: Can Stripe afford that?**

A: Stripe's valuation is $159 billion , so size-wise it's feasible . But they'd need to raise a lot of cash or do a stock deal, which is complicated since Stripe is private.

**Q: Why would Stripe want PayPal?**

A: Strategic logic includes: adding Braintree's $700 billion in volume, gaining consumer-facing brands (PayPal and Venmo), and potentially building a stablecoin business .

**Q: What's Braintree?**

A: It's PayPal's payment processing unit for businesses. Bernstein values it at $10–$15 billion .

**Q: What's Venmo worth?**

A: Bernstein estimates about $5 billion . It's the leading peer-to-peer payment app, especially popular with younger users.

**Q: What did PayPal's stock do on the news?**

A: Jumped 5.8% Monday and another 6.7% Tuesday . That's nearly 13% in two days.

**Q: Who else might be interested in PayPal?**

A: Bernstein analyst Harshita Rawat suggested JPMorgan, private equity firms, Revolut, and American Express could also be potential suitors .

**Q: Is PayPal's stock cheap?**

A: Mizuho's Dan Dolev notes PayPal trades at about 7x forward 2027 earnings, far below its five-year average of 20x . By that measure, yes—it's historically cheap.

**Q: When would a deal happen?**

A: If it happens at all, not anytime soon. These are early-stage talks. Any deal would take months to negotiate and then face regulatory review.

---

## The Bottom Line

Here's what I keep coming back to.

Two companies. One at the peak of its powers, valued at $159 billion and growing fast. The other at a low point, trading at $43 billion after years of decline.

A deal would make strategic sense—Stripe gets consumer reach, PayPal gets a lifeline and a powerful parent. Together, they'd be a formidable force in global payments.

But the hurdles are real. Early-stage talks often go nowhere. Regulatory scrutiny would be intense. Integration would be brutal.

For now, this is a fascinating rumor that tells us something about where the industry is headed. The strong are getting stronger. The weak are vulnerable. And in fintech, size and strategy matter more than ever.

Whether this deal happens or not, one thing is clear: the payments landscape is shifting under our feet. And the companies that adapt—through acquisition, innovation, or both—will shape how we all pay for years to come.

---

*Got thoughts on a potential Stripe-PayPal deal? Think it makes sense or crazy? Drop a comment and let me know.*