Forget celebrity-fronted TV spots, viral social media blitzes and flashy highway billboards. The best marketing campaigns for hybrid vehicles in the US are gas station signs that read $4.36 per gallon.

Last week, Japanese and Korean automakers revealed record third-quarter hybrid sales in the US, driven by American consumers who asked their local car dealerships for the most mileage-friendly option. Their US rivals, months after a hard pivot away from electrified vehicles, suddenly looked flat-footed. On Monday, General Motors Vice President Mike Anderson told CNBC that the Detroit auto giant is working to change that “as quickly as we can.”

A Hybrid Sparkplug

Last fall, US federal tax credits worth up to $7,500 for new EVs and $4,000 for used ones expired, denting EV sales prospects like the T-ball grade-schoolers next door dent the panels on a new car. With tax credits gone, EV sales plummeted 23% year over year in the second quarter, according to Cox Automotive. Cox projects the pace of the decline will rise to 45% in the third quarter, though a last-minute rush on EV buying before the Sept. 30, 2025, tax credit deadline likely caused considerable distortion.

As EV prospects dimmed, the Big Three Detroit automakers, General Motors, Ford and Stellantis, pivoted. They incurred more than $50 billion in combined write-downs and restructuring charges to cut back on ambitious EV plans launched before the EV tax credits went the way of the DeLorean. Production shifted to the classic pickups and SUVs with high profit margins that have been top sellers for years.

Cue the US-Iran war in February. Consumer incentives in the car market were turned around again. Confronted with staggering gas bills, US car buyers honed in on hybrids, which conserve fuel by running on both gas engines and electric motors. In August, 19% of all US vehicle sales were hybrids, compared to 16% before the war, according to JD Power. But the companies capturing the lion’s share of that growth are not in Detroit, they’re across the Pacific. Japanese and Korean automakers with a historically large US presence maintained a more robust EV and hybrid offering than their American rivals, making them the chief beneficiaries of the hybrid surge:

• South Korea’s Hyundai reported last week that its US hybrid sales grew 35% in the third quarter, powering the lion’s share of growth for its quarterly record 246,896 vehicles sold, up 3% year over year. Hybrid sales at Kia, which Cox identified as the fastest-growing hybrid seller and which Hyundai owns 35% of, rose an even more dramatic 152% in the third quarter.
• Toyota said its US electrified vehicle sales, which includes hybrids, rose 28.5% year over year in the third quarter, while Cox estimated the Japanese automaker holds a commanding 44% of the US hybrid market. Honda’s US hybrid sales rose 21% to a record 106,000 in the third quarter.

Still Unclear: Sales at GM, which offers only one hybrid model, fell 6% in the first nine months of the year. GM’s Anderson didn’t offer CNBC a timeline as to when the company will roll out hybrids — it has previously targeted 2027 — but acknowledged the recent spike in demand and said the company is “not tone deaf to our customers.” In August, Detroit rival Ford previewed mockups of a $25,000 small hybrid crossover to car dealers, which it expects to launch in 2029.

On the eve of its merger deal with Paramount Skydance finally closing, Warner Bros. Discovery went out with a bang in the form of a nuclear-grade box office bomb. Over the weekend, the Tom Cruise-led “Digger” earned an abysmal $8 million across 3,300 screens with a budget that reportedly ran close to $180 million. They’ll be seeing red for a while on that one.

As David Ellison’s new media empire, which will henceforth be simply known as Skydance, begins a debt-strapped new era, the “Digger” disaster is a reminder that the modern box office remains boom or bust. That leaves the company largely reliant on whether its streaming unit can grow faster than its still-lucrative linear TV business can sink. What could go right?

Showtime, Baby

Box office booms are still possible, and the theatrical industry is actually enjoying its best year since the pre-pandemic Before Times. But neither WBD nor Paramount has been invited to the party. “Digger” is just the latest in what looks like a WBD carpet bombing campaign this year, following fellow high-profile flops like “Supergirl” and “The Bride.” That makes it no surprise that WBD’s studio heads Pamela Abdy and Michael De Luca, who led the company to a record-breaking and award-winning 2025, have already been informed they won’t have a home in the newly combined Skydance. Paramount’s not faring much better, if at all. The studio earned just the seventh-largest box office haul this summer, behind WBD (6th place), indie studio A24 (5th) and Lionsgate (4th).

In other words: Salvation will not be found at the cinemas. In its streaming and linear realms, on the other hand, Skydance may be set up for success:

• Ellison has suggested that Paramount+ and HBO Max will be combined in the fullness of time. That has the potential for a streaming “powerhouse,” Morgan Stanley wrote in a note to clients last month. Skydance could have 230 million subscribers by 2030, MS analysts said.
• That would make it neck and neck with Disney and Amazon as strong runners-up behind Netflix, MS said, adding that the company will have a strong mix of scale and IP.

Lift Off: “At the end of the day, [Skydance’s success] is going to be about where we get these synergies. It is going to be about pushing streaming growth, getting better streaming economics and trying to maintain the EBITDA you have from the linear network,” John Conca, sector analyst at Third Bridge Group, told The Daily Upside.

DraftKings caught an updraft yesterday when its shares soared more than 8%. Bank of America analysts upgraded the sports-betting stock from “neutral” to “buy,” predicting DraftKings has upside ahead after falling more than 40% this year.

The analysts expect DraftKings could rake in $400 million in fees next year and an additional $200 million to $400 million from market making. The upgrade comes amid concerns about prediction markets crowding out traditional sports books.

Playing Both Sides

Trading volume on prediction markets has surged in recent years, and the top two platforms, Kalshi and Polymarket, have seen most users’ money flowing into sports-related wagers. The proliferation of prediction markets posed an existential threat to traditional sports books including DraftKings and FanDuel, which faced more restrictions on where they could operate compared to federally regulated prediction markets.

To hedge their bets, DraftKings and FanDuel both launched prediction markets of their own, sparking concerns the new business could cannibalize their existing sports books. That hasn’t been the case, and at the same time, the massive popularity of placing sports wagers seems to have made room for both markets:

• While prediction markets have notched massive inflows, so have sports books. The US sports betting industry hit a revenue record last year as Americans placed nearly $167 billion worth of bets, according to the American Gaming Association. This last Sunday, DraftKings saw its event contracts biz hit record trading volume of $218 million, up more than 50% from the NFL’s first Sunday this season.
• The business of sports wagers could keep growing as Gen Z comes into its full financial strength. Two-thirds of Gen Z investors surveyed by Betterment said they place sports bets. Similarly, the Bank of America Institute attributed nearly half of all online betting in July to Gen Z, surpassing millennials’ share for the first time.

Plenty of Turf: Bank of America analysts also expect legal challenges surrounding prediction markets could benefit DraftKings — though DraftKings offers prediction markets, its main biz is still traditional sports books. In the meantime, the opportunity that is prediction markets outweighs the risk of cannibalizing its sports books, according to the analysts. And for now, the massive demand to make trades while watching Monday Night Football could mean there’s room for old and new players on the field. New prediction market platform Novig recently saw its trading volume jump 94% following its controversial ad campaign featuring Sydney Sweeney.