Highlights for this morning: Anthropic turned down by the Pentagon, Netflix pulled out of the fight for Warner Bros.

Netflix has given up the fight for Warner Bros. Discovery, clearing the way for Paramount's $111 billion deal for Skydance. AI startup Anthropic is not giving in to the standoff with the Pentagon. And in Japan, Nintendo is preparing a 300 billion yen cross-package sale with MUFG and Bank of Kyoto and a parallel buyback amid regulatory pressure. These and other topics - in our review of key events for the morning of February 27.

Netflix has declined to continue its fight to buy Warner Bros. Discovery, paving the way for rival Paramount Skydance to strike a $111 billion deal, Bloomberg reported.

The streaming giant said that at the price needed to outbid Paramount's latest offer of $31 per share, the deal had become financially unfavorable and preferred to focus on its own investments - about $20 billion in content this year. Netflix shares rose as much as 13% in after-market trading, while Warner Bros. securities were down 1.7%.

Netflix had previously offered $82.7 billion including debt for Warner Bros.' studio and streaming business, but Paramount's counteroffers for the entire company kept the auction open.

Anthropic CEO Dario Amodei said the company "cannot in good conscience" allow the U.S. Department of Defense to use its AI models without restrictions for all legal purposes, CNBC reports. The startup is demanding assurances that the technology will not be used for fully autonomous weapons and mass domestic surveillance. The Pentagon insists on the right to use the models for "all lawful purposes" and has given the company a deadline of Friday, threatening to recognize it as a supply chain risk or invoke the Defense Production Act.

Anthropic has already signed a $200 million contract with the Pentagon and was the first to integrate models into classified military networks. OpenAI's competitors, Google and xAI, have also received contracts worth up to $200 million and agreed to use their models without similar restrictions (xAI - including in classified systems). The US Department of Defense says it does not plan to use AI for autonomous weapons or mass surveillance, but emphasizes that it will not allow companies to dictate terms to the military.

Nintendo is planning a strategic cross-share sale: MUFG Bank and Bank of Kyoto may sell about 300 billion yen ($1.9 billion) worth of the company's securities, Reuters has learned. In parallel, the Super Mario maker is considering a share buyback. The decision may be made as early as Friday. Nintendo shares were up 2.4%, while Kyoto Financial shares were up 9%.

The sale comes amid pressure from regulators and the Tokyo Stock Exchange urging Japanese companies to reduce cross-shareholdings. Such steps have already been taken in 2019, and the day before Reuters reported on Toyota's plans for a similar $19 billion sale. The practice of cross-shareholding, long common in Japan, has been criticized by investors as a way to protect management from shareholder influence.

Biotech company Generate Biomedicines placed 25 million shares at $16 and raised $400 million, valuing the company at about $2 billion, Bloomberg reports. The offering was in the middle of the $15-17 price range and appeared oversubscribed. The shares will begin trading on the Nasdaq under the ticker GENB, with Goldman Sachs and Morgan Stanley as organizers.

Biotech IPOs have already raised $1.4 billion in 2026, up from $915 million a year earlier, and new issuers have seen average share growth of 41%. Generate, founded by Flagship Pioneering in 2018, previously raised $273 million in a Series C round and received $110 million in partnerships with Novartis and Amgen. The company had a net loss of $223 million in 2025.

- Japan's broad Topix index was up 1.36 percent, while the Nikkei 225 was up 0.16 percent.

- Hong Kong's Hang Seng index was up 0.91%. CSI 300 index of mainland China was falling by 0.34%.

- In South Korea, the Kospi index was adding 0.46% and the Kosdaq was up 0.79%.

- Australia's S&P/ASX 200 was up 0.25 percent.

- S&P 500 futures were down 0.20 percent, Nasdaq Composite futures were down 0.09 percent and Dow Jones Industrial Average exchange-traded contracts were down 0.41 percent.

This article was AI-translated and verified by a human editor