WEBVTT - VW Rebounds, B&M Drops, Ubisoft Slips

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>The Stock Movers Report, your roundup of companies making moves

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<v Speaker 2>in the stock market, harnessing the power of Bloomberg Data.

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<v Speaker 3>Let's take a look at some stocks on the move

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<v Speaker 3>today in Europe. I'm Stephen Carroll with Lizzie Burden, and

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<v Speaker 3>we're joined by Bloomberg reporter Chloe Mane Chloy.

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<v Speaker 1>Good morning.

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<v Speaker 3>Let's start with Volkswagen announcing a beat on cash flow

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<v Speaker 3>and rebounding from the tariff uncertainty.

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<v Speaker 1>Yeah.

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<v Speaker 4>Well, it's not often that I come on here and

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<v Speaker 4>say that it's a good day for carmakers, but today

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<v Speaker 4>it definitely is involved.

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<v Speaker 1>To happen once in a while, Yeah, it can happen.

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<v Speaker 4>And Volksbagen in particular, as you mentioned, is doing well

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<v Speaker 4>this morning, and as you mentioned, there is a couple

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<v Speaker 4>of reasons behind that.

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<v Speaker 1>So, first of all, it did say last night that

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<v Speaker 1>it ended twenty.

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<v Speaker 4>Twenty five with more cash in its automotive division than

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<v Speaker 4>it had expected, and that is because it's essentially saving

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<v Speaker 4>a lot of money by delaying projects and investments in

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<v Speaker 4>electric vehicles, so it's pushing back payments to suppliers and

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<v Speaker 4>spending life on things like equipment, tools, research, and so

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<v Speaker 4>this lower capital spending, it's better liquidity, reassured investors. And

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<v Speaker 4>then the other thing, the bigger picture is of course

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<v Speaker 4>Trump and Trump saying that he wouldn't impose tariffs on

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<v Speaker 4>the countries that I've said they were against his efforts

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<v Speaker 4>to acquire Greenland. So when he announced those tariffs and

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<v Speaker 4>said that they would be imposed on February first, the

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<v Speaker 4>car making sector took a really big hit because of

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<v Speaker 4>how exposed of an industry it is to global trade

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<v Speaker 4>into tariffs, and so this reversal from Trump is seen

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<v Speaker 4>as a very positive for the sector. And yeah, there's

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<v Speaker 4>not many details, but as Lizzie mentioned, is enough for markets.

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<v Speaker 4>And so we have now essentially proved that one of

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<v Speaker 4>the biggest carmakers is finding steadier footing. And then there's

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<v Speaker 4>also now this tariff threat being walked back, and so

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<v Speaker 4>both of those things have been very positive. And we've

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<v Speaker 4>seen all of those car makers in the green actually

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<v Speaker 4>this morning and Vogs bag and really leading that challenge

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<v Speaker 4>as well.

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<v Speaker 2>Now, Claire, you know like A just can't be and

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<v Speaker 2>M down today one point one percent because of a

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<v Speaker 2>cut to its earnings.

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<v Speaker 3>Outlock tell us more.

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<v Speaker 4>Yeah, so it cut its guidance again, and so this

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<v Speaker 4>time is because of the costs of its turnaround plan.

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<v Speaker 1>So just to rewind a bit, essentially one nonprofit.

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<v Speaker 4>Back in October, I said that a review of the

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<v Speaker 4>business had revealed some really big missteps, like duplicated promotions

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<v Speaker 4>and too many product ranges, and in announced plan to

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<v Speaker 4>bring the company back to growth. And then two weeks later,

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<v Speaker 4>so still in October, it said that it had made

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<v Speaker 4>an accounting error, and so it cuts its guidance again,

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<v Speaker 4>and then the CFO left as well, and so all

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<v Speaker 4>of that led to a lot of weakness in the

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<v Speaker 4>share price back in twenty twenty five.

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<v Speaker 1>And today it's saying that the.

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<v Speaker 4>Turnaround plan that it had announced last year is showing

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<v Speaker 4>some very early signs of progress, but that all the

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<v Speaker 4>measures that it's taking, like clearing inventory and reducing pricing

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<v Speaker 4>for example, that's going to really hurt profit in the

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<v Speaker 4>near terms, and so that's why it cut its target again.

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<v Speaker 4>And that's of course not being taken super well by

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<v Speaker 4>the market, and it will probably take a while for

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<v Speaker 4>BNM to be kind of properly back on track because

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<v Speaker 4>it's dealing with a lot of competition and also those

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<v Speaker 4>increasing wage costs which are really weighing on retailers more generally.

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<v Speaker 3>And then we're turning now to France and Ubisoft the

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<v Speaker 3>games maker, cutting its guidance and cancing a number of

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<v Speaker 3>new projects.

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<v Speaker 4>Yeah, and that's really tough day to day for ub Soft.

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<v Speaker 4>It's saw the steepest ever drop in the shads, talking

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<v Speaker 4>about thirty percent, and that's because of that guidance cut

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<v Speaker 4>and this announcement of a big restructuring. So it's trying

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<v Speaker 4>to streamline the business and so it said it will

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<v Speaker 4>be closing studios in Canada and Sweden and also cancel

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<v Speaker 4>six games and delay seven other games. So one analyst

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<v Speaker 4>said that this decision on the game shows that the

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<v Speaker 4>internal operating model is broken and that management doesn't have

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<v Speaker 4>a grasp on the development a cycle. And ub Soft

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<v Speaker 4>has really struggled to remain competitive in the last few

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<v Speaker 4>years and the games that it has put out haven't

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<v Speaker 4>really resonated with audiences the way that they needed to.

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<v Speaker 4>And the company is now hoping that this major restructuring

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<v Speaker 4>means that it can go back to growth in a

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<v Speaker 4>couple of years. But in the meantime, this guidance ca

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<v Speaker 4>and these delays on games means that there's probably going to.

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<v Speaker 2>Be a lot of short term pag The Stock Movers

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<v Speaker 2>Report from Bloomberg Radio. Check back with us throughout the

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