Shares of Time Warner spiked nearly 5% on Thursday following a report that the media and entertainment giant held informal discussions with AT&T about a possible merger. We are not sure how serious the talks were, as neither side has hired a financial adviser. And we’re not sure what regulators would think of such a massive combination.

But it is one more sign of how the barriers between industries are falling. AT&T CEO Randall Stephenson is reportedly intent on adding more original content to his company’s portfolio as he looks toward turning his telecommunications giant into a media and entertainment behemoth. AT&T is just over a year removed from closing its massive, $49 billion purchase of DirecTV. Meanwhile competitor Verizon is gobbling up Yahoo following its purchase of AOL.

Top News

• British American Tobacco Offers $47 Billion for Reynolds American

In a move that could create the world's largest listed tobacco company, British American Tobacco has offered $47 billion to buy the remaining stake in U.S. firm Reynolds American. The unsolicited cash-and-stock takeover bid would hand BAT the 57.8% stake in Reynolds it does not already own, representing a roughly 20% premium over the Thursday closing price of the American company's stock. Reynolds, which hasn't yet responded to the takeover offer, is only a few days removed from announcing former PepsiCo executive Debra Crew as its next CEO, starting in January. Should the two companies agree on a deal, the takeover would fully combine such well-known cigarette brands as Camel, Newport, and Pall Mall. Reuters

• Walmart's Unveils its Plan for China 

Walmart announced on Thursday a series of initiatives in partnership with Chinese e-commerce giant JD.com. The new plans will see Walmart taking advantage of JD.com’s extensive delivery infrastructure to reach a consumer base representing roughly 90% of China’s population. Walmart, which could even use drones to deliver goods to Chinese customers, took a 5% stake in JD.com over the summer as part of a deal in which the Chinese company acquired Walmart’s local e-commerce platform. As Walmart looks to grow its e-commerce business globally, CEO Doug McMillon has promised a “sharpened focus on China,” where the company’s pace of store openings has slowed in recent years.  Fortune

• Microsoft's Cloud Business Sends Shares Sky High

Microsoft's share price reached an all-time high of $60.75 in after-hours trading on Thursday after the software giant reported that sales of its Azure cloud computing service more than doubled in its latest quarter compared to the same period last year. Overall, Microsoft's so-called "intelligent cloud" business—which includes Azure as well as server software sales—saw its revenue increase more than 8% to nearly $6.4 billion year-over-year. While the results show the latest fruits in CEO Satya Nadella's bet on cloud computing, his company still has a long way to go to catch up to market leader Amazon. Fortune

• Bombardier Will Cut Another 7,500 Jobs

Bombardier said Friday that it is cutting another 7,500 jobs, or 10% of its workforce, as the Canadian manufacturer of planes and trains looks to maneuver out from its massive debt load. The company expects to record between $225 million and $275 million in restructuring charges starting in this year's fourth quarter and continuing into 2017. The turnaround plan could yield savings of roughly $300 million annually by the end of 2018, Bombardier said. The latest layoffs mark the company's second major cuts in eight months, as the company announced an earlier 10% employment cut in February. Bombardier continues to carry nearly $9 billion in long-term debt, much of which it accrued developing its new C Series jetliner.  Bloomberg

Around the Water Cooler

• Four Takeaways From Tesla's Big Announcement

Elon Musk's big reveal that he'll outfit all new Tesla vehicles with technology that allows them to drive autonomously drew a big reaction in the tech and automotive sectors this week. Fortune's Kirsten Korosec laid out the biggest takeaways from the announcement, including the fact that Musk created a price benchmark for self-driving technology by pricing the software in question at $8,000 per vehicle. Also of note: the importance of Tesla's use of over-the-air software updates via wireless networks and the company's decision to develop its own vision processing tools. What's more, Musk's disclaimer preventing customers from using autonomous vehicles for ride-sharing purposes actually hints at Tesla's possible future development of its own Uber-like ride-hailing service. Fortune

• Verizon Takes Another Look at Yahoo Deal While Sales Slip 

The huge data breach at Yahoo is forcing Verizon to consider renegotiating its $4.8 billion deal for the embattled company's web portal, the telecommunications giant reiterated on Thursday. Verizon has said it does not plan to walk away from the deal. But, the company does expect the massive breach to have a "material impact" on Yahoo, which could mean Verizon will seek a discounted price tag. Meanwhile, Verizon reported that its revenue dipped for the second straight quarter while its wireless subscriber numbers also tumbled amid increased competition from rival carriers.  Wall Street Journal (subscription required)

• PayPal CEO: Venmo Nearing $20 Billion in Annual Payments

PayPal CEO Dan Schulman said during a call with analysts on Thursday that his company's popular payments app, Venmo, is expected to reach $20 billion in annual payments this year. That's a big number for an app that's especially popular with younger users making relatively small, cashless transactions. Acquired two years ago along with Braintree, Venmo's record quarter—its $4.9 billion in processed payments represented a 131% bump year-over-year—helped bolster PayPal's overall third-quarter results. The company beat Wall Street's revenue estimates for the quarter, with mobile payments representing 29% of its overall payments volume.  Fortune

Summaries by Tom Huddleston, Jr.

huddleston.tom@fortune.com @tjhuddle