1 00:00:05,160 --> 00:00:07,920 Speaker 1: This is what the Flux. I'm Brett and I'm justin 2 00:00:08,000 --> 00:00:10,280 Speaker 1: and it's Friday, the fifteenth of August. Does the boy. 3 00:00:10,280 --> 00:00:13,239 Speaker 1: Apple is entering into your home in a whole new way. 4 00:00:13,320 --> 00:00:17,720 Speaker 1: We're talking security cameras, smart displays, and even tabletop robots. 5 00:00:17,800 --> 00:00:20,960 Speaker 1: Whatever that means about time yep. Apple has traditionally left 6 00:00:20,960 --> 00:00:23,320 Speaker 1: this to the likes of Google Home and Amazon's Alexa, 7 00:00:23,480 --> 00:00:26,200 Speaker 1: but now it plans to have some of these features 8 00:00:26,239 --> 00:00:28,440 Speaker 1: live in the next twelve months, all part of an 9 00:00:28,440 --> 00:00:31,880 Speaker 1: effort to restore Apple's and mojue, and it seems to 10 00:00:31,960 --> 00:00:34,480 Speaker 1: be working, as it saw a jump in its share price. 11 00:00:34,600 --> 00:00:36,839 Speaker 1: Cn't wait for that robot me dox am. One of 12 00:00:36,840 --> 00:00:38,840 Speaker 1: the biggest pieces of feedback we get from the Flux 13 00:00:38,920 --> 00:00:41,320 Speaker 1: community is how hard it is to track all of 14 00:00:41,360 --> 00:00:43,559 Speaker 1: your spending that goes in, that goes out, and that's 15 00:00:43,560 --> 00:00:45,440 Speaker 1: why we have the Flux budgeting tool. But on top 16 00:00:45,479 --> 00:00:47,800 Speaker 1: of that, we've just released an article about how tracking 17 00:00:47,840 --> 00:00:50,760 Speaker 1: your expenses can unlock the biggest money go make sure 18 00:00:50,760 --> 00:00:52,880 Speaker 1: to download the Flux app and check out the article. 19 00:00:53,040 --> 00:00:56,480 Speaker 1: Three Magnificent stories Today jusy boy, let's do it for 20 00:00:56,520 --> 00:00:59,840 Speaker 1: our first Telstra has seen its annual net profit jump 21 00:01:00,080 --> 00:01:02,400 Speaker 1: thirty one percent if you don't mind off the back 22 00:01:02,440 --> 00:01:04,840 Speaker 1: of growth in its mobile services and now it's on 23 00:01:04,880 --> 00:01:07,520 Speaker 1: a buy back or rampage. Must be the new animated 24 00:01:07,520 --> 00:01:09,680 Speaker 1: ad with that long limbed guy walking be man, what 25 00:01:09,720 --> 00:01:12,600 Speaker 1: I'm talking about? I do? Tell me more well. Telstra 26 00:01:12,680 --> 00:01:15,640 Speaker 1: is Australia's biggest telco, founded in nineteen seventy five and 27 00:01:15,720 --> 00:01:18,960 Speaker 1: still dominates the market for mobile services despite us all 28 00:01:19,040 --> 00:01:21,280 Speaker 1: threatening to switch to opt Us every single time there's 29 00:01:21,280 --> 00:01:23,600 Speaker 1: a price hike. Fun fact, Telstra once owned the Yellow 30 00:01:23,640 --> 00:01:28,000 Speaker 1: Pages directory before we all started googling everything. Not happy jam, 31 00:01:28,560 --> 00:01:31,720 Speaker 1: but Jazzi Boyd Telstra's investors were a much happier jam 32 00:01:31,800 --> 00:01:34,600 Speaker 1: because it reported a two point three four billion dollar 33 00:01:34,680 --> 00:01:37,360 Speaker 1: annual net profit, which is up thirty one percent from 34 00:01:37,400 --> 00:01:40,920 Speaker 1: last year. Now. Two main reasons Miamigo on the one hand, 35 00:01:41,040 --> 00:01:43,720 Speaker 1: the aggressive cost cutting that has seen Telstra cut much 36 00:01:43,760 --> 00:01:46,479 Speaker 1: of its workforce, and two, Telstra sow growth in its 37 00:01:46,480 --> 00:01:49,760 Speaker 1: mobile business ah yes it's mobile eba dark group to 38 00:01:49,880 --> 00:01:52,760 Speaker 1: five point three billion dollars, which is a two hundred 39 00:01:52,800 --> 00:01:55,240 Speaker 1: and thirty five million dollar year on year jump. And 40 00:01:55,360 --> 00:01:58,200 Speaker 1: Jazi Boyd Telstra owes a big shout out to hire 41 00:01:58,480 --> 00:02:01,840 Speaker 1: r pu ARPU for doing lots of the heavy lifting, 42 00:02:01,960 --> 00:02:04,280 Speaker 1: and to top things off, telst renounced plans to buy 43 00:02:04,320 --> 00:02:06,920 Speaker 1: back a billion dollars worth of shares. So what is 44 00:02:06,960 --> 00:02:10,239 Speaker 1: the not happy jan key? Learning? Aar POO or average 45 00:02:10,320 --> 00:02:13,400 Speaker 1: revenue per user measures how much revenue the company earns 46 00:02:13,440 --> 00:02:16,280 Speaker 1: on average from each customer over a given period, and 47 00:02:16,360 --> 00:02:19,160 Speaker 1: for Telstra is one of the most important metrics for profit. Yeah. 48 00:02:19,200 --> 00:02:22,000 Speaker 1: In FO twenty five, higher rpoo was a key driver 49 00:02:22,240 --> 00:02:24,640 Speaker 1: behind their two hundred and thirty five million dollar lift 50 00:02:24,720 --> 00:02:27,160 Speaker 1: in mobile ebit dart. As part of this year Jazzi Boy, 51 00:02:27,240 --> 00:02:30,680 Speaker 1: Telstra rolled out price increases of three to five bucks 52 00:02:30,680 --> 00:02:32,840 Speaker 1: per month for its mobile plans and be Man, Well, 53 00:02:32,880 --> 00:02:35,600 Speaker 1: it might sound small, it becomes a very big number 54 00:02:35,639 --> 00:02:38,960 Speaker 1: when it's multiplied across twenty four million retail mobile services. 55 00:02:39,000 --> 00:02:41,840 Speaker 1: But boosting a poo isn't just about charging more for 56 00:02:41,880 --> 00:02:44,359 Speaker 1: the same plan. Nope, Telstra can grow this figure by 57 00:02:44,360 --> 00:02:47,720 Speaker 1: offering bundle services like mobile and home internet together, or 58 00:02:47,760 --> 00:02:51,680 Speaker 1: adding premium features like extra data, and of course sucking 59 00:02:51,720 --> 00:02:54,760 Speaker 1: everybody into the international roaming fees. Yeah, so, b man, 60 00:02:54,840 --> 00:02:58,000 Speaker 1: Telstra's trying to keep investors happy by squeezing more value 61 00:02:58,080 --> 00:03:02,160 Speaker 1: from each customer and cashing in on record profits. For 62 00:03:02,320 --> 00:03:05,760 Speaker 1: our second story, Westpax profit has jumped fourteen percent in 63 00:03:05,800 --> 00:03:09,320 Speaker 1: the most recent quarter, but mortgage brokers keep eating its lunch. 64 00:03:09,440 --> 00:03:12,200 Speaker 1: It's a hungry industry, isn't it. Juzzy boy, Nom nom nom. 65 00:03:12,360 --> 00:03:14,359 Speaker 1: So what is the story here? Okay? So, Westpac's the 66 00:03:14,400 --> 00:03:17,320 Speaker 1: oldest bank in Australia, founded in eighteen seventeen as the 67 00:03:17,360 --> 00:03:20,679 Speaker 1: Bank of New South Wales, and Westpac is Australia's second 68 00:03:20,760 --> 00:03:23,959 Speaker 1: largest home loan lender, only behind the Commonwealth Bank of Australia. 69 00:03:24,000 --> 00:03:27,280 Speaker 1: Westpac's quarterly profit juzzy Boy went up fourteen percent to 70 00:03:27,320 --> 00:03:30,079 Speaker 1: one point nine bill and b man its coordinate interest 71 00:03:30,120 --> 00:03:33,079 Speaker 1: margin jumped up five bases points to one point eighty 72 00:03:33,080 --> 00:03:36,440 Speaker 1: five percent. And investors liked what they saw because Westpac's 73 00:03:36,440 --> 00:03:38,760 Speaker 1: share price increased six percent. But b Man at slow 74 00:03:38,800 --> 00:03:41,760 Speaker 1: down because despite the towel wins this quarter, these may 75 00:03:41,800 --> 00:03:45,080 Speaker 1: not stick around for the upcoming quarter. Big call from you, particularly, 76 00:03:45,160 --> 00:03:47,080 Speaker 1: why do you think so? Well? Just forty six percent 77 00:03:47,120 --> 00:03:49,880 Speaker 1: of Westpac's new home loans came directly from the bank, 78 00:03:49,960 --> 00:03:52,440 Speaker 1: and that's down from March and almost three percent low 79 00:03:52,480 --> 00:03:55,200 Speaker 1: of them last year. So while the results trended upwards, 80 00:03:55,280 --> 00:03:58,600 Speaker 1: Westpac needs to focus on improving its distribution channels. Yes, 81 00:03:58,640 --> 00:04:01,320 Speaker 1: so what is the key learning here? Distribution channel strategy 82 00:04:01,440 --> 00:04:03,920 Speaker 1: is all about deciding how business gets its product or 83 00:04:04,000 --> 00:04:06,880 Speaker 1: service to its customers. For banks, the two big channels 84 00:04:06,880 --> 00:04:09,400 Speaker 1: for home loans aret one the direct channel, that's when 85 00:04:09,440 --> 00:04:11,800 Speaker 1: customers come straight to the bank, and banks love this 86 00:04:11,920 --> 00:04:14,480 Speaker 1: channel because it means the bank keeps all the margin 87 00:04:14,560 --> 00:04:17,240 Speaker 1: and the customer relationship. And the other channel we're talking 88 00:04:17,240 --> 00:04:20,440 Speaker 1: about here is brokers. Yeah, those are the intermediaries who 89 00:04:20,440 --> 00:04:23,440 Speaker 1: match borrows with lenders and their home loans and jose bait. 90 00:04:23,520 --> 00:04:25,960 Speaker 1: The broken channel has grown rapidly in Australia, but b 91 00:04:26,040 --> 00:04:28,760 Speaker 1: Man direct loans are much more profitable for banks because 92 00:04:28,800 --> 00:04:31,480 Speaker 1: there's no broker commission. Not to forget, the banks can 93 00:04:31,480 --> 00:04:34,000 Speaker 1: cross sell other products like credit cards or insurance. But 94 00:04:34,080 --> 00:04:37,560 Speaker 1: right now in Australia, brokers originate roughly seventy five percent 95 00:04:37,680 --> 00:04:40,479 Speaker 1: of new Australian homelans and clearly they're starting to eat 96 00:04:40,520 --> 00:04:43,799 Speaker 1: into Westpac's direct channel lunch. So b Man at Westpac 97 00:04:43,839 --> 00:04:45,719 Speaker 1: knows that if it wants to keep its net interest 98 00:04:45,760 --> 00:04:48,400 Speaker 1: margin at a tasty level. It needs to bring borrows 99 00:04:48,560 --> 00:04:53,160 Speaker 1: back into the branch. For our third and final story, Perplexity, 100 00:04:53,240 --> 00:04:55,920 Speaker 1: the AI search engine has put in an offered by 101 00:04:55,920 --> 00:04:59,040 Speaker 1: Google's Chrome for more than thirty four billion US dollars. 102 00:04:59,279 --> 00:05:02,200 Speaker 1: Shots have been fired. Perplexity FLEXI year a man. So 103 00:05:02,480 --> 00:05:04,240 Speaker 1: what is going on? Well? In April this year, we 104 00:05:04,279 --> 00:05:07,120 Speaker 1: spoke about how US courts have ruled Google has two 105 00:05:07,279 --> 00:05:10,120 Speaker 1: monopolies in online search as well as in ad tech, 106 00:05:10,240 --> 00:05:12,400 Speaker 1: and this could result in the breakup of Google and 107 00:05:12,440 --> 00:05:14,840 Speaker 1: back then open Ay's head of product they'd be keen 108 00:05:14,880 --> 00:05:17,760 Speaker 1: to by Google's Chrome if the court forced Google to 109 00:05:17,839 --> 00:05:19,680 Speaker 1: sell it. But it didn't really go any further. But 110 00:05:19,760 --> 00:05:22,839 Speaker 1: now Perplexity has taken it one step further. Perplexity is 111 00:05:22,839 --> 00:05:25,279 Speaker 1: of course best known for its AI powered search engine, 112 00:05:25,320 --> 00:05:27,760 Speaker 1: but now it's lobbing bids for one of Google's most 113 00:05:27,839 --> 00:05:30,520 Speaker 1: valuable products. And to make matters worse for Google, it's 114 00:05:30,560 --> 00:05:33,880 Speaker 1: just days before Google Chrome's twentieth birthday. Cop that does 115 00:05:33,920 --> 00:05:36,880 Speaker 1: it boid. The experts aren't exactly betting their lunch money 116 00:05:36,880 --> 00:05:39,000 Speaker 1: on the deal going through, no, but it is the 117 00:05:39,040 --> 00:05:42,080 Speaker 1: first public and formal deal to try to snatch Chrome 118 00:05:42,160 --> 00:05:44,960 Speaker 1: away from Google, and for Google, Chrome is so much 119 00:05:45,040 --> 00:05:46,880 Speaker 1: more than just a search engine. So what's the key 120 00:05:46,920 --> 00:05:49,080 Speaker 1: learning here? The value of a business unit on its 121 00:05:49,080 --> 00:05:51,719 Speaker 1: own can be very different from its value within a 122 00:05:51,839 --> 00:05:54,680 Speaker 1: larger company. It's called synergy value, and it's all about 123 00:05:54,680 --> 00:05:57,159 Speaker 1: the extra benefit that a parent company gets from owning 124 00:05:57,160 --> 00:06:00,200 Speaker 1: a specific asset. For Google, Chrome isn't just that's the 125 00:06:00,200 --> 00:06:02,960 Speaker 1: web browser NP. It's a funnel that helps feed its 126 00:06:02,960 --> 00:06:06,120 Speaker 1: search business with user data and add opportunities, as well 127 00:06:06,120 --> 00:06:09,000 Speaker 1: as giving them the default market position. That's why losing 128 00:06:09,080 --> 00:06:12,479 Speaker 1: Chrome could have an outsized effect on Alphabet's revenue, even 129 00:06:12,600 --> 00:06:15,200 Speaker 1: if the standalone sale price is thirty four to even 130 00:06:15,240 --> 00:06:18,400 Speaker 1: fifty billion bucks. In fact, be Man Barkley's Bank reconds 131 00:06:18,400 --> 00:06:20,440 Speaker 1: that the sale of Google Chrome could lead to a 132 00:06:20,480 --> 00:06:23,320 Speaker 1: fifteen to twenty five percent drop in Alphabet share price. 133 00:06:23,440 --> 00:06:26,320 Speaker 1: In dollar terms, it could wipe between three hundred and 134 00:06:26,360 --> 00:06:28,880 Speaker 1: seventy and six hundred and fifteen billion US dollars in 135 00:06:28,920 --> 00:06:32,360 Speaker 1: Alphabet's market value now. So, while Perplexiti's offer has made 136 00:06:32,400 --> 00:06:35,120 Speaker 1: the headlines, do not expect Google to be rushing to 137 00:06:35,200 --> 00:06:38,200 Speaker 1: sign on that dotted line BOXAM over this weekend. This 138 00:06:38,360 --> 00:06:40,760 Speaker 1: is the time to read our latest article on account 139 00:06:40,760 --> 00:06:43,000 Speaker 1: of tract your expenses to glow up your bank account. 140 00:06:43,040 --> 00:06:44,839 Speaker 1: When you read that, on top of using the Flux 141 00:06:44,839 --> 00:06:47,760 Speaker 1: budgeting tool, it is the ultimate dynamic duo. Make sure 142 00:06:47,800 --> 00:06:49,680 Speaker 1: to download the Flux app and check it out. Thanks 143 00:06:49,720 --> 00:06:52,120 Speaker 1: for listening and we'll see you on Monday.