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Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside

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Speaker 1: my co host Matt Miller.

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Speaker 2: Every business day we bring you interviews from CEOs, market pros,

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Speaker 2: and Bloomberg experts, along with essential market moven news.

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Speaker 1: Find the Bloomberg Markets podcast called Apple Podcasts or wherever

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Speaker 1: you listen to podcasts, and at Bloomberg dot com slash podcast.

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Speaker 1: All right, let's bring on our next guest. We love

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Speaker 1: talking to Danielle. Danielle de Martino Booth, chief strategist and

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Speaker 1: CEO at QI Intelligence. Danielle, We've now had some time

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Speaker 1: a weekend or so to kind of digest what we've

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Speaker 1: heard from various central bankers around the world. I'm sure

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Speaker 1: you've had a chance to kind of coalesce a viewpoint.

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Speaker 1: Anything change for you. What are you really thinking about

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Speaker 1: where these central banks are going, where rates are going,

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Speaker 1: based on what we learned from some of them last week.

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Speaker 3: Well, I think at a very minimum, you need to

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Speaker 3: think of rates as going nowhere.

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Speaker 4: Okay, and I say that as a minimum.

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Speaker 3: We've only got a twenty percent probability of a rate

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Speaker 3: hike for the September the twentieth, But you know, this

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Speaker 3: is a big week for payroll data, so you know,

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Speaker 3: more strength in that area, even if it's very lagged

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Speaker 3: in nature, even if we're seeing massive revisions come out

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Speaker 3: of the Bureau of Labor Statistics, their birth death adjustment

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Speaker 3: showed a negative eight hundred and sixteen thousand revision downward

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Speaker 3: in the three quarters and December thirty first, twenty twenty two.

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Speaker 3: Even though the data seems to be catching up with reality,

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Speaker 3: it's pretty apparent to me.

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Speaker 4: At least that J.

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Speaker 3: Powell is looking at backward looking data for reasons to

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Speaker 3: justify higher for longer. I think that that is the goal,

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Speaker 3: and I think that he's going to look for whatever

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Speaker 3: data he can find to justify pressing forward with another

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Speaker 3: rate high ort again at a minimum, staying higher for longer,

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Speaker 3: continuing to run that balance sheet down.

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Speaker 5: Danielle, this is Simone here in New York. Good morning

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Speaker 5: to you. You know you talk about this meeting reality,

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Speaker 5: the FED meeting reality, and how the yellow trucking shut

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Speaker 5: down may herald the big beginning of a sort of

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Speaker 5: bankruptcy cycle. How do you see this playing out? What

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Speaker 5: kind of timeline would you anticipate for seeing more bankruptcies?

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Speaker 5: And then when can kind of the FED no longer

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Speaker 5: ignore that.

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Speaker 3: You know, that's a fabulous question, because you know, if

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Speaker 3: you look at bcygo on the terminal, you'll see that

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Speaker 3: the march of bankruptcies really.

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Speaker 4: Has not subsided.

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Speaker 3: We're continuing to see bankruptcies roll in at the fastest

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Speaker 3: pace since two thousand and nine. I think what the

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Speaker 3: FED has to take into account though, right now.

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Speaker 4: Is headline risk.

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Speaker 3: You kind of had a series of quarters where Silicon

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Speaker 3: Valley was coming out with very splashy headlines ten thousand here,

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Speaker 3: ten thousand there, and then that kind of went dormant

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Speaker 3: for a while. We really haven't seen headline risk in

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Speaker 3: layoffs announcements, but I think that we're going to see

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Speaker 3: that increasingly going forward. Whether you're talking to Chris Williamson

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Speaker 3: over at Standard and Poors, who is saying that, you know,

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Speaker 3: if manufacturing backlogs remain in traction as they'd have now

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Speaker 3: for fourteen fifteen straight months, that you're going to start

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Speaker 3: to see manufacturers that are not benefiting from the Inflation

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Speaker 3: Production Act, they are not building green new factories, You're

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Speaker 3: going to see layoffs start to come through. And that's

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Speaker 3: exactly what Chris Williamson warned about in the second quarter

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Speaker 3: earning season. Remember worldly at the halfway point in this

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Speaker 3: earning season, and you've got this great, big splashy thirty

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Speaker 3: thousand people losing their jobs. Because it looks like this

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Speaker 3: is going to be a Chapter seven filing straight to

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Speaker 3: liquidation as opposed to a Chapter eleven restructuring. This is

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Speaker 3: going to take capture a lot of Americans' attention.

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Speaker 1: So we're going to have a ton of economic data

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Speaker 1: this week, Danielle, You're going to you and your team

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Speaker 1: going to be very busy. Obviously, the non form payroll

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Speaker 1: will be a big data point. I guess I'm looking

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Speaker 1: around the world. I'm seeing some recessions around the world.

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Speaker 1: I guess Germany just had a flatline quarter after a

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Speaker 1: couple quarters of contraction. Are you concerned? What is your

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Speaker 1: level of concern about this US economy here?

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Speaker 3: Well, the US economy cannot claim to exist on an island.

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Speaker 3: You know, there was a very slight uptick in Chinese

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Speaker 3: official manufacturing data overnight, but that remained in contraction. I

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Speaker 3: think the more notable development out of China, given that

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Speaker 3: we had such great hopes for this reopening trade, is

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Speaker 3: more so that we're seeing a downward movement in the

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Speaker 3: services components of these PMI numbers, and that I think

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Speaker 3: was what people paid closer attention to overnight. G If

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Speaker 3: it's not going to be the industrial sector out of China,

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Speaker 3: then what's going to happen if the services side is

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Speaker 3: slowing down? Specifically that that service is one dropped to

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Speaker 3: fifty one point five. So you're kind of on the

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Speaker 3: edge of contraction in the second largest economy. And as

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Speaker 3: you just pointed out, Germany is really three quarters into recession.

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Speaker 3: We saw that the first quarter in Germany ended up

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Speaker 3: being revised downward into contraction. We could see a similar

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Speaker 3: a bit of data coming out of Germany that revises

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Speaker 3: this the second quarter into contraction as well. The United

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Speaker 3: States cannot isolate.

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Speaker 4: Itself from the globality of the current recession.

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Speaker 5: Yeah, but I mean to that end, though, the United

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Speaker 5: States has existed a little bit apart from China for

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Speaker 5: several years now. Considering how slowly China has come back

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Speaker 5: in the game post pandemic, and the US consumer remains strong,

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Speaker 5: I mean, do you think that the US consumer can

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Speaker 5: potentially continue to kind of power through some of this

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Speaker 5: growth and offset some of the woes that we hear

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Speaker 5: from around the world despite this level of a rising

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Speaker 5: interst rates.

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Speaker 3: You know, it's interesting you raise that question. Outside of

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Speaker 3: the employee Retention Credit, which we know, I think pumped

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Speaker 3: about thirty three billion dollars into the US economy, we

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Speaker 3: know much of this is fraudulent. Outside of that fiscal

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Speaker 3: area of massive support going to some of the wealthy Americans,

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Speaker 3: We're seeing a big uptick in the number of student

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Speaker 3: loan borrowers who are preemptively getting out in front of

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Speaker 3: what they know to be resumed student loan payments, and

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Speaker 3: that's going to have a crimping effect on US consumption.

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Speaker 3: And we are indeed beginning to see that. So people

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Speaker 3: are getting ahead of interest accrual beginning on septem of

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Speaker 3: the first actual payments beginning on October the first. I

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Speaker 3: don't see an offset to that in terms of layoffs decreasing,

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Speaker 3: in terms of hiring increasing. We're just not seeing enough

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Speaker 3: evidence to show that there's any upward momentum going forward

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Speaker 3: for the US consumer.

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Speaker 1: All Right, So I'm going back and I'm looking at

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Speaker 1: this ecoscreen on the Bloomberg terminal. It is literally two

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Speaker 1: screens full of data we're going to get this week, Danielle,

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Speaker 1: can you help me focus on what I need to

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Speaker 1: focus on if there's a data point out there that

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Speaker 1: you're really going to pay attention to this week.

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Speaker 3: So I'm going to be looking a lot in terms

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Speaker 3: of hours worked, and that really is a gauge of

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Speaker 3: how tightly employees are holding on to their employers are

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Speaker 3: holding onto their employees. If they're cutting back hours aggressively,

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Speaker 3: trying to not push through with cutting handcount to cut costs.

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Speaker 3: That's something we pay very close attention to. And again,

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Speaker 3: we had Chicago PMI just out a few minutes ago

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Speaker 3: that showed that backlogs remain in contraction. I'll be looking

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Speaker 3: for a similar echo out of the Dallas Fed Manufacturing

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Speaker 3: that hits at half past this hour. I focus, we

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Speaker 3: focus at QI Research so closely on backlogs because that

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Speaker 3: is a gauge of future demand.

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Speaker 4: If the demand is not there, if.

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Speaker 3: Unfilled orders are not there, and in fact contracting, that

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Speaker 3: means that your need for employees is decreasing as a

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Speaker 3: factor of time.

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Speaker 1: Hi, Danielle, thank you very much. Always appreciate getting a

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Speaker 1: couple minutes of your time, Danielle. Dee Martina Booth, CEO

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Speaker 1: and chief strategists at QI Research. Busy Busy Economic Week.

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Speaker 6: This week, you're listening to the Team Cans live program

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Speaker 6: Bloomberg Markets weekdays at ten am Eastern on Bloomberg dot Com,

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Speaker 6: the iHeartRadio app and the Bloomberg Business App, or listen.

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Speaker 7: On demand wherever you get your podcasts.

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Speaker 1: Still got a ton of earning, so when we get

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Speaker 1: their earnings, we like to talk to smart people and

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Speaker 1: we can find them. We just dial b Igo on

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Speaker 1: the terminal that gets you Bloomberg Intelligence four hundred research

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Speaker 1: anelts around the world covering you know, two thousand companies

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Speaker 1: one hundred and thirty industries and what they do is

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Speaker 1: really incredible.

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Speaker 5: They take you through from the beginning to the end

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Speaker 5: of how these stories for these different times.

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Speaker 1: Yeah, I don't know who started that business, but the

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Speaker 1: person must be a genius here. Anyway, let's bring in

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Speaker 1: a couple of those smart ones. Man Deep Scene covers

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Speaker 1: the tech stuff for Bloomberg Intelligence, and Punamcoil covers all

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Speaker 1: the retail and we're going to tie that in because

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Speaker 1: retail and technology they have collided. I think Amazon dot Com.

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Speaker 1: All right, So Man Deep, I want to start off with,

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Speaker 1: and we'll let you do I know this news on

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Speaker 1: pat palns. Here I'm gonna talk about Apple. What do

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Speaker 1: I need to pay attention to from Apples when they

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Speaker 1: report numbers after the closed Thursday unit shipments.

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Speaker 8: When it comes to smartphones as well as your tutts

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Speaker 8: and Max and look, I think expectations are low. Unlike

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Speaker 8: some of the other tech companies, Apple's estimates have gone down,

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Speaker 8: so in terms of you know, expectations, they are low.

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Speaker 8: I do think they're probably going to print an inline quarter.

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Speaker 8: But in terms of guide you have the iPhone fifteen

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Speaker 8: coming up. That is where the focus is the holiday quarter.

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Speaker 8: What could it do?

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Speaker 1: I think I might upgrade to the fifteen. Honor Rocks

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Speaker 1: pushing it on rok Run another one in your tech

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Speaker 1: flunkies over their Bloomberg intelligence. He's tell me that's meaningful upgrade.

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Speaker 8: It is, but I guess in the context of what's

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Speaker 8: going on in the tech world, the generative AI buzz,

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Speaker 8: it's not going to be that big off an upgrade

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Speaker 8: in terms of what the phone can do. And everyone

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Speaker 8: is excited about potentially upgrading the hardware for running these

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Speaker 8: large language models on your phone. I don't think the

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Speaker 8: iPhone fifteen doing that.

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Speaker 9: I mean, I'm interested.

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Speaker 5: Is this part of the overall weakness that you have

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Speaker 5: seen in PC demand? Is it just that your PCs

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Speaker 5: last longer, or is it somehow about penny pinching and

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Speaker 5: a broader consumer story at this point With that.

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Speaker 8: I think there was a kind of certain cadence to

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Speaker 8: refresh cycle for both piecs and smartphones that hasn't changed.

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Speaker 8: Every time you have a big upgrade to hardware is

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Speaker 8: when you have a new technology coming up, and I

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Speaker 8: think whether it's linking your headset or being able to

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Speaker 8: run generative AI on your phone, these are the type

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Speaker 8: of things that can drive people to upgrade their phones,

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Speaker 8: the ones that are on the fans. My device is

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Speaker 8: good enough, do I really need a new one? And

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Speaker 8: that's what drives the asps. So right now everyone is

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Speaker 8: talking about even though the unit shipments is flat, how

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Speaker 8: will Apple keep growing? It's the services and the asps

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Speaker 8: because the next version of the phones continues to get

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Speaker 8: expensive and they keep learning more services.

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Speaker 1: All right, Punham, We've got a lot of retailers set

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Speaker 1: the report and the come weeks, but let's start with

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Speaker 1: with Amazon. What do you expect the story to be

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Speaker 1: from Amazon.

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Speaker 4: It's dark pall.

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Speaker 10: I think it's going to be a mixed break. So

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Speaker 10: we're going to see some strength online with sales growing

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Speaker 10: or I should say gm re growing in the high

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Speaker 10: single digit range, which is a good thing because since

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Speaker 10: the pandemic, you know, Amazon has dealt to it having

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Speaker 10: to see more moderated sales growth and coming back to

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Speaker 10: the high single digit, low double digit range just puts

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Speaker 10: it on track to go back to the double digit

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Speaker 10: games that we've been used to seeing in online. But

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Speaker 10: outside of that, you know, the focus is also on

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Speaker 10: a WUS and EWS sales will slow in the quarter.

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Speaker 10: They're only expected to grow at a high single digit pace,

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Speaker 10: and they could even moderate further in three Q when

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Speaker 10: we see their guidance, which could probably be closer to

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Speaker 10: seven percent.

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Speaker 5: How much does AWS just simply outweigh, you know? However,

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Speaker 5: successful or not, Prime Day was the various shopping trends

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Speaker 5: that we're seeing.

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Speaker 10: Yeah, so Prime Day was a huge success. We heard

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Speaker 10: from Amazon the first day of it's largest sales date ever.

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Speaker 10: It even out faced Black Friday and Cyber Monday last year.

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Speaker 10: But when it comes to a WUS, the reason a

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Speaker 10: WS is so important because it is the cashprap for Amazon.

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Speaker 10: Right they produced pretty much all for nearly all of

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Speaker 10: Amazon's profits, so it's really important to see those profit

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Speaker 10: numbers rise. In the quarter, Amazon's a WUS business will

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Speaker 10: only yield about a twenty four percent profit margin. It

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Speaker 10: has historically been year thirty percent. We do see it

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Speaker 10: coming back to that and even now facing that as

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Speaker 10: we move forward in the next few years. But for now,

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Speaker 10: you know that profit dwindles a little, it will pressure

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Speaker 10: the overall profitability.

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Speaker 1: Man Deep AI is certainly story number one in your

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Speaker 1: world and technology another name today that seems to be

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Speaker 1: getting the you know, the AI you know, kind of

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Speaker 1: tap on the shoulders Palenteer. What's going on there? What

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Speaker 1: is Palenteer and why is it up eleven percent today?

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Speaker 8: So with all the talk around generative AI, and you know,

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Speaker 8: Microsoft is the only one that has launched a tangible

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Speaker 8: product around it. They're charging thirty dollars coat gpt well

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Speaker 8: and also they're charging thirty dollars for their co pilots.

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Speaker 8: This is the enterprise version of the product. Jackipt is

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Speaker 8: more consumer facing. So to me, you know, all these companies,

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Speaker 8: whether it's Palenteer Snowflake data breaks. What they're doing is

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Speaker 8: essentially ingesting these large amounts of data that is being

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Speaker 8: created and trying to use you know, generative AI or

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Speaker 8: large aguage models to make the AI better. And that

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Speaker 8: is what the play is now.

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Speaker 11: Whether or not.

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Speaker 8: They're successful in monetizing it, we don't know because they

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Speaker 8: haven't launched a product like Microsoft has, So.

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Speaker 4: That is the key.

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Speaker 8: If if any time you see a company actually launching

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Speaker 8: a product being able to sell their customers, that's when

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Speaker 8: you know this is a new deal. And that's I

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Speaker 8: think the only tangible revenue you see right now is

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Speaker 8: for Microsoft. Yes it's for they're out, but at least

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Speaker 8: they have a product out there they're looking to monetize it.

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Speaker 8: With Palenteer, you've seen multiple expansion. Yes, this is a

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Speaker 8: company that is built around data visualization and potentially could

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Speaker 8: use generative AI, but we don't know if they have

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Speaker 8: a product.

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Speaker 1: They'll be But that gets an eleven percent move in

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Speaker 1: the stock.

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Speaker 8: And that's where you know. Everything that has happened this

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Speaker 8: year is multiple expansion, no optick in estimates, so come earnings.

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Speaker 8: The expectations are sky high, and that's where you got

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Speaker 8: to deliver like Nvidia has.

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Speaker 7: You know.

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Speaker 1: That's what Doug Cast from Seabree's Partners was saying to

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Speaker 1: Tom Keenan and I. And he's he's gotten increasingly bearish

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Speaker 1: as years going on because it's all multiple expansion. He

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Speaker 1: hasn't seen the earnings yet the first half of the year. Okay,

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Speaker 1: he kind of understands, you know, the most recent you know,

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Speaker 1: four or five, six weeks he just doesn't get. So

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Speaker 1: that makes kind of surprise.

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Speaker 5: It's people looking for the long term growth that we're

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Speaker 5: not going to necessarily see immediately. But put on, I

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Speaker 5: want to throw this to you as well, because I

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Speaker 5: know you cover lots of these consumer and e commerce companies.

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Speaker 5: One of the things that that we've been trying to

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Speaker 5: parse here on the AI story is do we see

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Speaker 5: some of these AI upgrades roll out, you know, for

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Speaker 5: consumer benefit, for you know, tailoring ads that get to consumers,

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Speaker 5: for getting the right products in front of them, or

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Speaker 5: do we just simply see efficiency on the back end?

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Speaker 5: What are you seeing from some of the brands that

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Speaker 5: you cover, because I know there are quite the lengthy

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Speaker 5: list that report this week that may throw in that

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Speaker 5: mention of AI and their earnings calls.

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Speaker 10: Sure, I think AI is both. It definitely will drive

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Speaker 10: efficiencies on the back end, but we are seeing companies

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Speaker 10: also bring it to the benefit of the consumers and

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Speaker 10: the sellers. A recent example they reported last week and

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Speaker 10: they launched a listing program where you can take a

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Speaker 10: picture of a product that you want to sell and

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Speaker 10: AI will generate the description for you. So it removes

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Speaker 10: a pain point to our friction point in the selling

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Speaker 10: process and also allows you to amplify your listings online.

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Speaker 10: So we think that's one Useas we have revolved reporting

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Speaker 10: this week, they've used AI to help generate marketing billboards,

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Speaker 10: They're using AI to help improve search. So I think

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Speaker 10: there's a lot happening with AI, notably generative AI that's

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Speaker 10: really going to drive the ROI for both the buyers

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Speaker 10: and the sellers.

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Speaker 7: Real quick.

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Speaker 1: And deep. I want to talk to you about advanced

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Speaker 1: micro devices. It's a chip maker. Can it be a

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Speaker 1: Nvidia kind of like play?

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Speaker 8: I mean, last week we learned from Intel that PC

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Speaker 8: market seems to be bottoming out in terms of inventory correction,

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Speaker 8: so that's a positive sign. And look, bulk of AMD's

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Speaker 8: revenue is still tied to CPUs now what's going on

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Speaker 8: with generative AI is there is a substitution phenomena. Things

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Speaker 8: that you were able to do with CPUs before right

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Speaker 8: now you're looking to do with GPUs because that's where

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Speaker 8: the generative AI connection comes into play. So I do

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Speaker 8: think eventually you're going to find that these companies either

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Speaker 8: have to diversify their CPU footprint YEP and produce these accelerators,

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Speaker 8: or I think they will be a tale of two

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Speaker 8: stories that one part is growing and the other part

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Speaker 8: is declining.

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Speaker 1: All right, well, keep an eye on all that. More

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Speaker 1: earnings coming up this week and probably going into next

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Speaker 1: week as well. Man Deep Singh Punamgoyle. They are two

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Speaker 1: of the best analysts of Bloomberg Intelligence, one covering tech,

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Speaker 1: one covering retail. But guess what, it's all converging.

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Speaker 6: You're listening to the tape Cat's are live program Bloomberg

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Speaker 6: Markets weekdays at ten am Eastern on Bloomberg Radio, the

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Speaker 6: tune in app, Bloomberg dot Com, and the.

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Speaker 7: Bloomberg Business app.

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Speaker 6: You can also listen live on Amazon Alexa from our

347
00:17:36,160 --> 00:17:41,200
Speaker 6: flagship New York station. Just say Alexa play Bloomberg eleven thirty.

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Speaker 1: Let's stop the salad business. I'm not a big salad here.

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Speaker 5: I love I love you kind of like salads at lunch,

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Speaker 5: which is okay, I think our.

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Speaker 1: Next All I know is, you know the people here

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Speaker 1: come around lunchtime, they come in and out. They're all

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Speaker 1: carrying these bags from Sweet Green, which I guessed at

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Speaker 1: the time was a salad thing. Again, not being a

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Speaker 1: solid person, I don't know, but it is definitely a

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Speaker 1: thing across the street from the Bloomberg HQ here at

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Speaker 1: Midtown Manhattan, and I know it is around the country

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Speaker 1: as well. Jonathan Neeman joins us. He's the CEO and

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Speaker 1: founder of Sweet Green. It's sweet Green trades on New

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Speaker 1: York Stock Exchange symbols. SG can put that into your

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Speaker 1: Bloomberg terminal. Jonathan, Thanks so much for joining us here.

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Speaker 1: I know you guys reported earnings last week, missed a

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Speaker 1: little bit on revs and on EPs stock traded down.

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Speaker 1: Tell us about the most recent quarter, tell us about

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Speaker 1: the guidance you're giving your investors.

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Speaker 12: Absolutely, good morning everyone. So we're really proud of the

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Speaker 12: quarter we posted. We had twenty two percent year over

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Speaker 12: year growth, three percent comps with positive traffic, and we

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Speaker 12: expanded our restaurant level margin above twenty percent, delivering our

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Speaker 12: first profitable quarter on an adjusted ebad up perspective as

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Speaker 12: a public company. So I think a sign of more

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Speaker 12: things to come companies focused on discipline, capital efficient growth

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Speaker 12: as we continue to bring our mission across the country

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Speaker 12: to more cities and more locations, and we're looking forward

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Speaker 12: to continuing driving some comp drivers we have around our

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Speaker 12: loyalty program as well as our expanded menu.

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Speaker 5: Well, Jonathan, you know, Piper Sandler was out today with

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Speaker 5: a note talking about how the tide maybe turning here

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Speaker 5: a bit for Sweet Green after a tough sledding since

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Speaker 5: going public, And I think it's pretty obvious going public

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Speaker 5: November twenty twenty one, right post pandemic, then seeing the

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Speaker 5: wave of omicron has to be hard for any company

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Speaker 5: that does a lot of office business. Do you see

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Speaker 5: the tide as turning? What things are you telling investors, Hey,

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Speaker 5: wait for this because in a quarter, two quarters, we're

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Speaker 5: really going to be able to start delivering on some

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Speaker 5: of those expectations.

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Speaker 12: Yeah, you know, we're focused. We're focused on a few

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Speaker 12: big things. One is continuing to expand our footprint and

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Speaker 12: not only opening our classic stores, but a few new

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Speaker 12: formats that we've opened that have been really interesting and successful,

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Speaker 12: one being our drive through format called the Sweet Lane,

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Speaker 12: another being our Infinite Kitchen. We've also been you know,

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Speaker 12: I hear you guys talk about, you know, not being

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Speaker 12: a salad guy. While Sweegeren started as a salad company,

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Speaker 12: we're much more than that today. Really consider ourselves healthy

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Speaker 12: comfort food and our warm bowls. We sell more warm

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Speaker 12: bowls than we do salads. We're on a journey to

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Speaker 12: continue to expand our menu and taking the type of

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Speaker 12: sourcing and fresh prep that we do, but expanding it

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Speaker 12: beyond just salads and so things with you know, leaning

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Speaker 12: on protein and carbs and just heardier craveable items to

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Speaker 12: really bring our mission to life. As I mentioned, we've

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Speaker 12: also been focused on a loyalty program. We call it

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Speaker 12: Sweet Pass. It has two components, both the free rewards

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Speaker 12: and challenges, as well as a membership program where for

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Speaker 12: ten dollars a month you get three dollars off every day,

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Speaker 12: and so a number of comp drivers built into the

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Speaker 12: business as we look forward, all while bringing a discipline,

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Speaker 12: a you know, a cost discipline approach and making this

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Speaker 12: company profitable.

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Speaker 5: Yeah, talk to me about Infinite Kitchen. You mentioned this there.

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Speaker 5: This is the sort of automated version of your kitchen.

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Speaker 5: You've rolled out one of them that I believe and

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Speaker 5: correct me if I'm wrong. Here eliminates employees, you know,

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Speaker 5: you put together these bulls without employees there. What's your

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Speaker 5: vision for the scale of this, for the timeline with

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Speaker 5: respect to getting this in more than just kind of

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Speaker 5: a handful of stores.

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Speaker 3: No.

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Speaker 12: Automation is something that I'm personally very excited about, and

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Speaker 12: it's something that Sweekering has been working on for a

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Speaker 12: number of years, develop you know, developing this technology in house.

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Speaker 12: And so what we see is is we believe that

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Speaker 12: we will always still make the food in house, but

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Speaker 12: with this automation, we're able to assemble the bulls in

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Speaker 12: a precise manner at much higher throughputs. So the Infinite

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Speaker 12: Kitchen can make four to five hundred bowls per hour,

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Speaker 12: perfectly portioned, perfectly accurate, with very high quality, a very

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Speaker 12: high quality experience both for our team members and our consumers.

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Speaker 12: So people are loving the pilot store that we have.

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Speaker 12: We're opening a second Infinite Kitchen restaurant later this year

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Speaker 12: in Huntington Beach, California, and have plans to begin integrating

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Speaker 12: this technology into restaurants next year. We do believe over time,

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Speaker 12: you know, a huge portion of our fleet will integrate

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Speaker 12: this technology. But we still have a lot to learn

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Speaker 12: in terms of in terms of you know, exactly how

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00:22:18,040 --> 00:22:20,720
Speaker 12: to deploy it. But all to say, a very promising

439
00:22:20,760 --> 00:22:21,879
Speaker 12: start with this technology.

440
00:22:22,560 --> 00:22:25,880
Speaker 1: John, to talk to me again, not being that familiar

441
00:22:25,920 --> 00:22:28,200
Speaker 1: with your restaurants, although I am going to go today

442
00:22:28,200 --> 00:22:30,160
Speaker 1: for the first time because it's on sixty first Street,

443
00:22:30,200 --> 00:22:33,600
Speaker 1: I think, and Lex, I'll give that a shot. You

444
00:22:33,960 --> 00:22:37,520
Speaker 1: where have you historically located your stores and where are

445
00:22:37,560 --> 00:22:40,640
Speaker 1: you and how has that changed maybe since the pandemic

446
00:22:41,000 --> 00:22:44,040
Speaker 1: in the different way ways people work and the amount

447
00:22:44,040 --> 00:22:45,560
Speaker 1: of time to spend in the office versus home.

448
00:22:46,600 --> 00:22:49,280
Speaker 12: Absolutely so we hope. We started the company in Washington,

449
00:22:49,320 --> 00:22:52,960
Speaker 12: d C. Almost sixteen years to the day. Three kids

450
00:22:53,000 --> 00:22:55,520
Speaker 12: in Georgetown really had nowhere to aid, so we started

451
00:22:55,560 --> 00:22:57,880
Speaker 12: in DC. We worked our way up the Eastern Corridor

452
00:22:58,240 --> 00:23:00,880
Speaker 12: and for the first call it decade of the company's history.

453
00:23:00,920 --> 00:23:04,080
Speaker 12: We're very urban leaning, although you know, we did have

454
00:23:04,320 --> 00:23:07,280
Speaker 12: suburban stores as well. Ever since the pandemic, with the

455
00:23:07,320 --> 00:23:10,520
Speaker 12: dispersion of consumers as well as following our customers home,

456
00:23:11,000 --> 00:23:14,200
Speaker 12: we've begun to explore more suburban and so our pipeline

457
00:23:14,240 --> 00:23:17,520
Speaker 12: has leaned heavily suburban to a number of new markets

458
00:23:17,560 --> 00:23:20,119
Speaker 12: over the past few years, where our fleet today is

459
00:23:20,480 --> 00:23:24,440
Speaker 12: approximately fifty percent urban fifty percent suburban, and we see

460
00:23:24,720 --> 00:23:27,639
Speaker 12: pretty much equal success in both in both worlds, so

461
00:23:27,800 --> 00:23:31,680
Speaker 12: similar av similar margins, which really is you know, talks

462
00:23:31,720 --> 00:23:34,040
Speaker 12: a lot about the portability of the brand not only

463
00:23:34,119 --> 00:23:36,439
Speaker 12: in different type of trade areas, but in different markets

464
00:23:36,440 --> 00:23:37,280
Speaker 12: all over the country.

465
00:23:37,400 --> 00:23:40,639
Speaker 5: Does that capture a different kind of consumer when you

466
00:23:40,680 --> 00:23:45,199
Speaker 5: move outside those typically urban areas. And then also you know,

467
00:23:45,240 --> 00:23:48,760
Speaker 5: with respect to the consumer, are you worried about the

468
00:23:48,840 --> 00:23:54,280
Speaker 5: restart of student loan payments weighing on your customer's wallets.

469
00:23:55,720 --> 00:23:58,520
Speaker 12: So we are expanding, We're continuing to expand our consumer,

470
00:23:58,680 --> 00:24:03,119
Speaker 12: so looking to capture more families, different age groups and

471
00:24:03,160 --> 00:24:06,360
Speaker 12: really be relevant for anyone looking for a craveable, delicious

472
00:24:06,400 --> 00:24:08,879
Speaker 12: and healthy meal. So over time, our vision is to

473
00:24:08,920 --> 00:24:12,080
Speaker 12: redefine fast food and really bring this idea of healthy

474
00:24:12,080 --> 00:24:14,680
Speaker 12: comfort food to scale and kind of see everyone as

475
00:24:14,720 --> 00:24:17,880
Speaker 12: being our consumer over time. In terms of the health

476
00:24:17,880 --> 00:24:20,680
Speaker 12: of the consumer, we see a lot of health in

477
00:24:20,720 --> 00:24:24,600
Speaker 12: our consumer today, we haven't seen any reason to be concerned.

478
00:24:24,600 --> 00:24:27,399
Speaker 12: It is something we're of course watching, understanding the student

479
00:24:27,400 --> 00:24:30,679
Speaker 12: debt repayments, but given the twenty two percent year over

480
00:24:30,760 --> 00:24:33,919
Speaker 12: year growth and the positive comp and positive traffic, we

481
00:24:34,000 --> 00:24:36,679
Speaker 12: are overall feeling very good about the trajectory.

482
00:24:37,280 --> 00:24:39,560
Speaker 1: All right, Jonathan, thanks so much for taking some time

483
00:24:39,640 --> 00:24:42,600
Speaker 1: to chat with this. Jonathan Nieman. He's the CEO and

484
00:24:42,720 --> 00:24:45,800
Speaker 1: co founder of sweet Green. As a publicly traded company.

485
00:24:45,800 --> 00:24:48,520
Speaker 1: You could type in the ticker SG into your Bloomberg

486
00:24:48,600 --> 00:24:51,560
Speaker 1: Professional terminal and get all the day you need on

487
00:24:51,640 --> 00:24:54,720
Speaker 1: that company. I think I'm gonna go there today. It'll

488
00:24:54,760 --> 00:24:55,400
Speaker 1: be my first time.

489
00:24:55,600 --> 00:24:57,800
Speaker 5: Are you gonna as you going there? Going to add

490
00:24:57,800 --> 00:24:59,879
Speaker 5: to the twelve percent gain that we're seeing in this

491
00:25:00,040 --> 00:25:01,480
Speaker 5: shares some sweet Green today.

492
00:25:01,359 --> 00:25:06,960
Speaker 1: Maybe I think Paul eating a salad he like defeats

493
00:25:07,000 --> 00:25:09,040
Speaker 1: the purpose. I think you're right, he's gonna put fried

494
00:25:09,119 --> 00:25:09,719
Speaker 1: chicken in it.

495
00:25:09,760 --> 00:25:10,000
Speaker 7: Etc.

496
00:25:10,880 --> 00:25:12,920
Speaker 1: All right, we'll see how it goes. I'll report back.

497
00:25:14,119 --> 00:25:17,520
Speaker 6: You're listening to the teenth Ken's Are Live program Bloomberg

498
00:25:17,560 --> 00:25:19,920
Speaker 6: Markets weekdays at ten am Eastern.

499
00:25:19,640 --> 00:25:22,680
Speaker 7: On Bloomberg dot com, the iHeartRadio.

500
00:25:21,960 --> 00:25:24,719
Speaker 6: App, and the Bloomberg Business app or listen on demand

501
00:25:24,760 --> 00:25:26,360
Speaker 6: wherever you get your podcasts.

502
00:25:27,920 --> 00:25:31,600
Speaker 1: So let's talk beer, let's talk Heineken, and we do that.

503
00:25:31,640 --> 00:25:34,400
Speaker 1: We talked to Duncan Fox Research Channel, so Bloomberg Intelligence

504
00:25:34,440 --> 00:25:39,800
Speaker 1: you can tell via zoom from the phenomenal Bloomberg European

505
00:25:39,880 --> 00:25:43,359
Speaker 1: headquarters at Queen Victoria Street in London and absolutely phenomenal

506
00:25:43,840 --> 00:25:45,960
Speaker 1: building right in the city of London, right by the

507
00:25:45,960 --> 00:25:48,360
Speaker 1: Bank of England. Thank you very much, Mike. We appreciate

508
00:25:48,600 --> 00:25:51,840
Speaker 1: those digs over there. Duncan talk to us about Heinegen.

509
00:25:51,920 --> 00:25:54,720
Speaker 1: What do we hear from our good friends in Amsterdam.

510
00:25:55,480 --> 00:25:57,640
Speaker 11: It was a little bit of a surprise today actually

511
00:25:57,680 --> 00:26:02,360
Speaker 11: in that they actually don't radio expectations. That's something that

512
00:26:02,800 --> 00:26:06,080
Speaker 11: our friends at Hanegan don't do very often. So they've

513
00:26:06,119 --> 00:26:09,280
Speaker 11: basically been investing a lot more behind their brands, and

514
00:26:09,320 --> 00:26:11,920
Speaker 11: there was a couple of markets which really had had

515
00:26:11,920 --> 00:26:16,160
Speaker 11: some poor volume, mainly Vietnam and Nigeria, and so they've

516
00:26:16,160 --> 00:26:18,679
Speaker 11: decided to keep their investment high in those markets and

517
00:26:18,680 --> 00:26:21,360
Speaker 11: take the hit on operating profit, which from my point

518
00:26:21,359 --> 00:26:23,879
Speaker 11: of view as an analyst for the long term, absolutely the

519
00:26:23,920 --> 00:26:25,280
Speaker 11: right thing to do. But it was a bit of

520
00:26:25,280 --> 00:26:28,840
Speaker 11: a shock this morning at six o'clock, shares a down

521
00:26:28,920 --> 00:26:31,320
Speaker 11: seven percent or so what they were the last song looked.

522
00:26:31,800 --> 00:26:34,000
Speaker 5: Hard to go out despite being in Europe, hard to

523
00:26:34,040 --> 00:26:35,760
Speaker 5: go out and get a beer at six am. I

524
00:26:35,840 --> 00:26:39,720
Speaker 5: think where the earnings come in as a surprise. Talk

525
00:26:39,760 --> 00:26:42,399
Speaker 5: to me about so a lot of this I understand

526
00:26:43,760 --> 00:26:50,920
Speaker 5: is they've invested heavily in these smaller, more local oriented operations.

527
00:26:51,440 --> 00:26:52,359
Speaker 4: But there is.

528
00:26:52,359 --> 00:26:55,800
Speaker 5: Where the consumers are feeling maybe the pinch is it

529
00:26:55,840 --> 00:26:58,920
Speaker 5: because they kind of can't continue to add these price

530
00:26:59,000 --> 00:27:05,480
Speaker 5: increases on as supply prices increase, or explain to me

531
00:27:05,520 --> 00:27:07,840
Speaker 5: how this how they how this bruise down?

532
00:27:09,720 --> 00:27:10,119
Speaker 7: Nice one.

533
00:27:10,200 --> 00:27:13,600
Speaker 11: Yeah, basically they pushed price up about twelve percent on average,

534
00:27:13,600 --> 00:27:16,240
Speaker 11: which is which is pretty high. But you have to

535
00:27:16,240 --> 00:27:20,399
Speaker 11: remember that their their costs went up mid teams in

536
00:27:20,880 --> 00:27:22,800
Speaker 11: Q one, They're going to go up low teams in

537
00:27:22,880 --> 00:27:25,320
Speaker 11: Q two. So what they've done is effectively take the

538
00:27:25,359 --> 00:27:29,240
Speaker 11: pricing up front, and occasionally in some markets they just

539
00:27:29,280 --> 00:27:32,320
Speaker 11: want to be too far as the economies slowed, so

540
00:27:32,400 --> 00:27:35,439
Speaker 11: the consumer has, however much money they've got to spend,

541
00:27:35,520 --> 00:27:39,119
Speaker 11: and beer is not an essentials much as I'd like

542
00:27:39,160 --> 00:27:41,919
Speaker 11: it to be. So you know, they've traded down, i

543
00:27:41,960 --> 00:27:45,840
Speaker 11: think in some markets to cheaper brands, So they've got

544
00:27:45,880 --> 00:27:48,920
Speaker 11: the right long term strategy for sure. You know, they've

545
00:27:48,920 --> 00:27:51,480
Speaker 11: the markets still are mentioned Vietnam and Nigeria. They have

546
00:27:51,680 --> 00:27:55,920
Speaker 11: huge populations, great economic growth in the long term. They've

547
00:27:55,960 --> 00:27:58,280
Speaker 11: just had some short term issues that have that have

548
00:27:58,440 --> 00:28:01,280
Speaker 11: caused them some volume decline in short term. But you know,

549
00:28:02,080 --> 00:28:05,000
Speaker 11: they've taken the decision to look long term, which I

550
00:28:05,000 --> 00:28:07,800
Speaker 11: think is the right decision and sort of take the

551
00:28:07,880 --> 00:28:10,439
Speaker 11: volume sort of the profit hit this year. So it

552
00:28:10,520 --> 00:28:13,360
Speaker 11: makes sense to me. But yeah, right now, so I've

553
00:28:13,359 --> 00:28:14,080
Speaker 11: been expecting that.

554
00:28:14,119 --> 00:28:17,040
Speaker 1: First thing, I'm looking at the pg EO function on

555
00:28:17,080 --> 00:28:19,399
Speaker 1: the Bloomberg terminal that gives you a financial analysis in

556
00:28:19,400 --> 00:28:21,040
Speaker 1: a kind of you can see by segment where these

557
00:28:21,080 --> 00:28:23,680
Speaker 1: guys are and by geography. Forty percent of their revenues

558
00:28:23,680 --> 00:28:26,480
Speaker 1: comes from Europe, you know, about thirty three percent from

559
00:28:26,680 --> 00:28:30,040
Speaker 1: America's and then Asia's the next biggest and then Emea.

560
00:28:30,119 --> 00:28:33,200
Speaker 1: So are they investing in? I guess where are really

561
00:28:33,240 --> 00:28:35,600
Speaker 1: the key growth markets for them that you talk about

562
00:28:35,600 --> 00:28:36,560
Speaker 1: their investment.

563
00:28:38,000 --> 00:28:40,520
Speaker 11: Ironicy Brazil is one that they've pushed quite a lot

564
00:28:40,520 --> 00:28:42,680
Speaker 11: of money into in the last couple of years. They

565
00:28:42,840 --> 00:28:45,440
Speaker 11: bought Kier in this business, probably about four or five

566
00:28:45,520 --> 00:28:49,360
Speaker 11: years ago now, and they've been transferring that to make

567
00:28:49,400 --> 00:28:52,920
Speaker 11: sure they have Amstell and Heineken beer going through that network.

568
00:28:53,280 --> 00:28:56,920
Speaker 11: They're gaining market share, but obviously it's not showing through

569
00:28:56,920 --> 00:29:00,400
Speaker 11: and operating profits. Because of that investment, You've then got

570
00:29:00,560 --> 00:29:05,240
Speaker 11: Mexico's a big market. Vietnam China are the big markets.

571
00:29:05,240 --> 00:29:07,720
Speaker 11: So all of those have got very very big populations,

572
00:29:07,760 --> 00:29:11,960
Speaker 11: with one more importantly been young urban populations, and that's

573
00:29:11,960 --> 00:29:14,880
Speaker 11: what you want as a beer manufacturer. Then you can

574
00:29:14,880 --> 00:29:17,479
Speaker 11: tell your investment to actually get long term growth. So

575
00:29:17,720 --> 00:29:20,640
Speaker 11: say it all makes sense, but every now and again

576
00:29:20,680 --> 00:29:23,640
Speaker 11: you come up with a shock because economic growth has

577
00:29:23,720 --> 00:29:30,040
Speaker 11: slowed down. Vietnam just for some reason, the economy just

578
00:29:30,120 --> 00:29:33,960
Speaker 11: stalled after the Chinese New Year. There was some overstocking

579
00:29:34,000 --> 00:29:36,600
Speaker 11: that they put in place during Chinese Year after pushing

580
00:29:36,640 --> 00:29:40,120
Speaker 11: prices up dramatically. They had forty three percent volume growth

581
00:29:40,120 --> 00:29:43,800
Speaker 11: in Vietnam last year, and I think they were expecting

582
00:29:43,840 --> 00:29:45,800
Speaker 11: something similar and I think they just got caught out

583
00:29:45,800 --> 00:29:47,840
Speaker 11: a little bit when they pushed prices a bit too high.

584
00:29:48,160 --> 00:29:49,960
Speaker 1: Dog Just let's step back and just look at the

585
00:29:49,960 --> 00:29:52,360
Speaker 1: global beer market. You know, when you talk to the

586
00:29:52,360 --> 00:29:55,479
Speaker 1: big brewers that that you cover, how do they think

587
00:29:55,480 --> 00:29:58,120
Speaker 1: about just kind of global growth for this category.

588
00:30:00,760 --> 00:30:05,920
Speaker 11: They would expect something low volume growth, but it's really

589
00:30:05,960 --> 00:30:10,760
Speaker 11: about premiumizing your brand portfolio so you get very good

590
00:30:10,800 --> 00:30:15,400
Speaker 11: pricing and mix. That's where their strategies are. Problem with

591
00:30:15,520 --> 00:30:19,000
Speaker 11: that is when you've got economic growth faltering, you take

592
00:30:19,040 --> 00:30:20,640
Speaker 11: it on the chin in the short term and you've

593
00:30:20,680 --> 00:30:23,200
Speaker 11: just got to keep investing behind those brands to try

594
00:30:23,240 --> 00:30:27,640
Speaker 11: and get us to buy the premium beer. So it's

595
00:30:27,680 --> 00:30:30,240
Speaker 11: all about that, all about getting into the markets where

596
00:30:30,240 --> 00:30:33,480
Speaker 11: you've got younger than populations, so emerging markets, to where

597
00:30:33,480 --> 00:30:35,840
Speaker 11: the growth is going to be, and then making as

598
00:30:35,920 --> 00:30:38,080
Speaker 11: much money as you can from your core home markets,

599
00:30:38,120 --> 00:30:41,040
Speaker 11: which are more likely in developed markets like the US

600
00:30:41,120 --> 00:30:44,800
Speaker 11: or Europe. As you mentioned earlier for Heineken, So Heinekens's

601
00:30:45,120 --> 00:30:49,200
Speaker 11: investment has been getting outside of Europe basically and reducing

602
00:30:49,240 --> 00:30:52,920
Speaker 11: that GEO split to forty percent. It was well over

603
00:30:53,360 --> 00:30:55,640
Speaker 11: it was probably sixty percent of about ten years ago.

604
00:30:55,960 --> 00:30:58,640
Speaker 11: So they've done a very good job at pushing the

605
00:30:58,680 --> 00:31:00,000
Speaker 11: portfolio into the right area.

606
00:31:00,880 --> 00:31:04,480
Speaker 5: Speaking about those core markets in North America and Europe.

607
00:31:05,120 --> 00:31:10,080
Speaker 5: Is the beer drinker or spirits drinker, perhaps more broadly,

608
00:31:10,440 --> 00:31:13,560
Speaker 5: are they healthier in one versus the other? What is

609
00:31:13,600 --> 00:31:16,320
Speaker 5: some of the commentary that you're hearing from these brands

610
00:31:16,320 --> 00:31:18,200
Speaker 5: that span both markets telling you.

611
00:31:20,440 --> 00:31:24,080
Speaker 11: Well? Certainly, up until recently, the spirits market was doing

612
00:31:24,160 --> 00:31:27,720
Speaker 11: very very well. Experiences you probably heard an iconic Debra

613
00:31:27,880 --> 00:31:30,880
Speaker 11: can talk about those very very key for the young

614
00:31:30,880 --> 00:31:34,360
Speaker 11: consumer at the moment, and the spirits companies have been

615
00:31:34,400 --> 00:31:38,280
Speaker 11: extremely good at fueling that. If you look at all

616
00:31:38,320 --> 00:31:40,600
Speaker 11: of the marketing campaigns that the spirit companies do, it's

617
00:31:40,640 --> 00:31:43,720
Speaker 11: around events, so they hire bars and do something around

618
00:31:43,720 --> 00:31:47,720
Speaker 11: the brand, and that's been very very successful. Beer companies

619
00:31:47,720 --> 00:31:50,520
Speaker 11: have yet really to go down that route, though they

620
00:31:50,520 --> 00:31:55,120
Speaker 11: are now putting money into e commerce to make sure

621
00:31:55,160 --> 00:31:57,760
Speaker 11: that it can get more of that spend I suppose,

622
00:31:57,800 --> 00:32:00,640
Speaker 11: and more of the consumers doing it it the beer companies,

623
00:32:00,680 --> 00:32:02,040
Speaker 11: I think you've got to catch up a little bit.

624
00:32:02,480 --> 00:32:04,800
Speaker 11: All in all, they both get a volume growth in

625
00:32:04,840 --> 00:32:07,480
Speaker 11: the sort of low single digit if you strip out

626
00:32:07,600 --> 00:32:10,960
Speaker 11: the COVID anomalies that we've had over the last few years.

627
00:32:11,000 --> 00:32:14,160
Speaker 11: So it's going to be very interesting how the results go.

628
00:32:14,280 --> 00:32:16,320
Speaker 11: The rest of this week and the Agio tomorrow and

629
00:32:16,360 --> 00:32:19,000
Speaker 11: ABI later in the week, and let's see where their

630
00:32:19,080 --> 00:32:23,120
Speaker 11: volume growth are. We know there's been some slight overstocking

631
00:32:23,160 --> 00:32:26,240
Speaker 11: in the trade as we've gone through all that COVID anomalies,

632
00:32:26,320 --> 00:32:28,720
Speaker 11: so it's going to be very interesting set of results.

633
00:32:28,920 --> 00:32:31,920
Speaker 1: So don't get to know your top level analyst. You

634
00:32:32,040 --> 00:32:34,280
Speaker 1: like to do a lot of primary research. So you're

635
00:32:34,320 --> 00:32:37,200
Speaker 1: in your local, your favorite pub in London. What's a

636
00:32:37,280 --> 00:32:40,800
Speaker 1: pint of your favorite beer cost you today?

637
00:32:42,640 --> 00:32:45,800
Speaker 11: Too much would be my response to that. But you're

638
00:32:45,840 --> 00:32:48,680
Speaker 11: looking at probably somewhere around between six and seven pounds

639
00:32:48,680 --> 00:32:53,040
Speaker 11: a pint. It's all sad. Yeah, it's not cheap. My

640
00:32:53,160 --> 00:32:55,320
Speaker 11: favorite pub though, is where I live, and I live

641
00:32:55,360 --> 00:32:59,120
Speaker 11: in Dorset now and it's a little bit better there.

642
00:32:59,120 --> 00:33:02,200
Speaker 11: It's probably around about three fifty a points fifty. Living

643
00:33:02,240 --> 00:33:03,560
Speaker 11: out in the country really.

644
00:33:03,360 --> 00:33:07,000
Speaker 1: Helps very good. All right, Well, you're right down there

645
00:33:07,200 --> 00:33:09,840
Speaker 1: in the city of London where all the big hitters

646
00:33:09,840 --> 00:33:12,080
Speaker 1: are in London, you can afford to pay a little

647
00:33:12,080 --> 00:33:15,600
Speaker 1: bit more. Duncan Fox doing that primary research that he's

648
00:33:15,600 --> 00:33:17,640
Speaker 1: known for. He cuts hover, He covers all the consumer

649
00:33:17,640 --> 00:33:21,200
Speaker 1: products over there in Europe for Bloomberg Intelligence six.

650
00:33:21,080 --> 00:33:23,000
Speaker 5: Seven dollars a pint. I mean when you can when

651
00:33:23,040 --> 00:33:24,160
Speaker 5: you take this dollar.

652
00:33:24,400 --> 00:33:26,720
Speaker 1: Oh yeah, yeah, yeah, it's exactly. I mean I remember

653
00:33:26,760 --> 00:33:28,960
Speaker 1: back when I went to UH. I think this is

654
00:33:29,000 --> 00:33:32,440
Speaker 1: a correct memory putting down a pound coin, which by

655
00:33:32,440 --> 00:33:34,360
Speaker 1: the way, is still the best coin in the plant

656
00:33:34,400 --> 00:33:36,600
Speaker 1: on the planet, the pound coin, the one British pound

657
00:33:37,000 --> 00:33:39,560
Speaker 1: that would get you a beer back in nineteen eighty

658
00:33:39,560 --> 00:33:43,720
Speaker 1: seven in London. So I don't know. So that's inflation.

659
00:33:44,040 --> 00:33:46,480
Speaker 1: That's inflation you can take home with all right. That

660
00:33:46,520 --> 00:33:48,240
Speaker 1: was Duncan Fox talking beer.

661
00:33:48,640 --> 00:33:51,760
Speaker 6: You're listening to the tape. Cat's are live program Bloomberg

662
00:33:51,800 --> 00:33:55,400
Speaker 6: Markets weekdays at ten am Eastern on Bloomberg Radio, the

663
00:33:55,480 --> 00:33:57,400
Speaker 6: tune in app, Bloomberg dot Com, and.

664
00:33:57,400 --> 00:33:58,680
Speaker 7: The Bloomberg Business App.

665
00:33:58,720 --> 00:34:01,560
Speaker 6: You can also listen live on Amazon Alexa from our

666
00:34:01,560 --> 00:34:06,240
Speaker 6: flagship New York station. Just say Alexa play Bloomberg eleven thirty.

667
00:34:07,760 --> 00:34:10,800
Speaker 1: Simone Foxman Paul Swingey here in the Bloomberg Interactive Broker Studio.

668
00:34:10,840 --> 00:34:13,600
Speaker 1: We are streaming live on YouTube. Can head over to

669
00:34:13,680 --> 00:34:16,960
Speaker 1: YouTube and search for Bloomberg the Global News, and that's where

670
00:34:17,000 --> 00:34:20,200
Speaker 1: you'll find this our C Suite conversation. Today we're gonna

671
00:34:20,200 --> 00:34:23,400
Speaker 1: be visit a company we checked in with earlier this

672
00:34:23,440 --> 00:34:26,920
Speaker 1: year is really a fascinating company. Dex Com is the company.

673
00:34:26,960 --> 00:34:30,319
Speaker 1: It's a medical equipment company. DXCM is the ticker. It's

674
00:34:30,320 --> 00:34:33,479
Speaker 1: a fifty billion dollar market cap company. Stocks up about

675
00:34:33,520 --> 00:34:35,560
Speaker 1: ten percent this year, up about fifty percent over the

676
00:34:35,600 --> 00:34:38,839
Speaker 1: trailing twelve twelve month basis, and they're into this thing,

677
00:34:38,960 --> 00:34:44,759
Speaker 1: the Continuous Glucose Monitoring System dc CGM Systems, and it's

678
00:34:44,800 --> 00:34:49,040
Speaker 1: pretty pretty cool stuff. Joining us today is their CEO,

679
00:34:49,160 --> 00:34:52,480
Speaker 1: Kevin Sayer. Joining us. Hey, Kevin, I know you guys recently,

680
00:34:52,560 --> 00:34:55,680
Speaker 1: I guess last week reported some numbers, beat on revenue,

681
00:34:55,680 --> 00:34:58,399
Speaker 1: beat on EPs. Talk to us about the quarter. What's

682
00:34:58,440 --> 00:35:01,080
Speaker 1: the key takeaway there and more importantly, what kind of

683
00:35:01,080 --> 00:35:02,280
Speaker 1: guidance did you give the street?

684
00:35:04,040 --> 00:35:06,080
Speaker 9: Well, thanks for having me on the show today. It

685
00:35:06,160 --> 00:35:09,479
Speaker 9: was a great quarter for us. In fact, I said

686
00:35:09,520 --> 00:35:11,880
Speaker 9: in the earnings remarks, it was like a highlight reel

687
00:35:12,400 --> 00:35:15,680
Speaker 9: with twenty six percent year over year growth, the largest

688
00:35:15,719 --> 00:35:19,760
Speaker 9: dollar growth in the history year over year quarterly basis

689
00:35:19,760 --> 00:35:22,240
Speaker 9: in the history of our company, more new patient ads

690
00:35:22,440 --> 00:35:25,480
Speaker 9: than any quarter in our existence. On top of that,

691
00:35:25,520 --> 00:35:29,799
Speaker 9: we had operating expense leverage that resulted in record net

692
00:35:29,840 --> 00:35:33,879
Speaker 9: income and profitability the factors that drove that. First of all,

693
00:35:33,920 --> 00:35:38,120
Speaker 9: we launched our latest system, our G seven, in the US,

694
00:35:38,120 --> 00:35:42,200
Speaker 9: and that launch has gone extremely well. We've got access

695
00:35:42,360 --> 00:35:45,759
Speaker 9: through all the major PBMs in the country and all

696
00:35:45,840 --> 00:35:49,960
Speaker 9: the insurance plans. We've also launched G seven and thirteen

697
00:35:50,000 --> 00:35:54,160
Speaker 9: international markets. Our international growth was actually forty percent this

698
00:35:54,320 --> 00:35:57,840
Speaker 9: quarter compared you on a year over year basis. The

699
00:35:57,920 --> 00:36:00,520
Speaker 9: G seven launches helped with that. Combined, if we have

700
00:36:00,719 --> 00:36:04,680
Speaker 9: a product portfolio strategy internationally to whereby we have a

701
00:36:04,719 --> 00:36:07,439
Speaker 9: family of products in each of these geographies that best

702
00:36:07,480 --> 00:36:11,719
Speaker 9: meets the access and reimbursement needs of those areas, and

703
00:36:11,760 --> 00:36:14,560
Speaker 9: we've been able to expand our international markets greatly. With

704
00:36:14,600 --> 00:36:17,919
Speaker 9: that bottom line, we took share in pretty much every

705
00:36:17,920 --> 00:36:21,040
Speaker 9: major reimburse market in the world this past quarter, and

706
00:36:21,080 --> 00:36:22,360
Speaker 9: that you see it in the numbers.

707
00:36:22,719 --> 00:36:22,919
Speaker 7: Yeah.

708
00:36:22,960 --> 00:36:25,000
Speaker 5: Can you talk to me about that international strategy a

709
00:36:25,040 --> 00:36:26,840
Speaker 5: little bit further. I know in your earnings call you

710
00:36:26,880 --> 00:36:28,960
Speaker 5: talked a little bit of Germany, a little bit of Friends,

711
00:36:30,200 --> 00:36:33,600
Speaker 5: and you're in thirteen markets. How are you rolling out,

712
00:36:33,640 --> 00:36:36,200
Speaker 5: where are you pushing into next and what are your

713
00:36:36,280 --> 00:36:39,279
Speaker 5: challenges there that are distinct from your challenges in the

714
00:36:39,400 --> 00:36:40,080
Speaker 5: US market.

715
00:36:41,600 --> 00:36:43,920
Speaker 9: With respect to our G seven, we have losched in

716
00:36:43,960 --> 00:36:46,960
Speaker 9: thirteen markets, but we're in several countries around the world.

717
00:36:47,280 --> 00:36:50,319
Speaker 9: The challenges that are different is is who pays for

718
00:36:50,400 --> 00:36:53,000
Speaker 9: it in the various geographies. You know, in the US,

719
00:36:55,239 --> 00:36:57,359
Speaker 9: the majority of our venues have been US for quite

720
00:36:57,360 --> 00:37:00,600
Speaker 9: some time with the insurance companies, but also AMS and

721
00:37:00,640 --> 00:37:05,759
Speaker 9: the medicaid programs. In the outside the US, oftentimes it's

722
00:37:05,840 --> 00:37:10,399
Speaker 9: the government who reimburses for continuous glucose monitoring, and they

723
00:37:10,400 --> 00:37:15,120
Speaker 9: have various standards in their classifications of products. So for example,

724
00:37:15,320 --> 00:37:18,240
Speaker 9: in some countries, they want to pay for a CGM

725
00:37:18,320 --> 00:37:22,080
Speaker 9: that integrates with insulin pumps, has automated insulin delivery and

726
00:37:22,239 --> 00:37:24,200
Speaker 9: reimburse at a higher price for that.

727
00:37:24,480 --> 00:37:26,040
Speaker 7: They'll have a.

728
00:37:26,040 --> 00:37:29,520
Speaker 9: Product that's a different classification that doesn't do as much

729
00:37:30,080 --> 00:37:33,120
Speaker 9: that they want to reimburse less money on a monthly basis.

730
00:37:33,120 --> 00:37:37,120
Speaker 9: For what we've done is we've created classes of products

731
00:37:37,120 --> 00:37:39,880
Speaker 9: that will address all the needs based on the geographies.

732
00:37:40,480 --> 00:37:44,279
Speaker 9: So you know, the UK is a perfect example. They

733
00:37:44,320 --> 00:37:47,000
Speaker 9: have two classes of products. We developed a product called

734
00:37:47,000 --> 00:37:49,920
Speaker 9: dex Com one. There is in this class that's not

735
00:37:50,000 --> 00:37:52,520
Speaker 9: a connected system. Well, it does talk to your phone.

736
00:37:52,520 --> 00:37:55,759
Speaker 9: It doesn't connect with other medical devices, whereas our G

737
00:37:55,960 --> 00:37:58,960
Speaker 9: series or our G seven product will in fact eventually

738
00:37:59,000 --> 00:38:02,239
Speaker 9: connect with an insulin pump or an insulin pen and

739
00:38:02,280 --> 00:38:05,399
Speaker 9: provide patients with an integrated system. So what we've done

740
00:38:05,440 --> 00:38:10,080
Speaker 9: in these geographies we assess the reimbursement strategies to whereby

741
00:38:10,120 --> 00:38:10,760
Speaker 9: we can grow.

742
00:38:11,280 --> 00:38:13,000
Speaker 7: We now offer the product.

743
00:38:12,600 --> 00:38:15,200
Speaker 9: That's best for that geography, or are all the products

744
00:38:15,200 --> 00:38:17,879
Speaker 9: if they'll reimburse for a family of products. And we've

745
00:38:17,920 --> 00:38:20,200
Speaker 9: been able to pick up market share in those geographies

746
00:38:20,200 --> 00:38:21,680
Speaker 9: and we analyze them one by one.

747
00:38:22,760 --> 00:38:24,839
Speaker 1: Well I did some I'll get give you some real

748
00:38:24,840 --> 00:38:26,719
Speaker 1: time feedback. I was on the beach in Jersey Shore

749
00:38:26,719 --> 00:38:28,120
Speaker 1: this weekend. I went up to a person who had

750
00:38:28,120 --> 00:38:31,120
Speaker 1: one of those patches and it looked just like the

751
00:38:31,120 --> 00:38:34,480
Speaker 1: one from Dexcom. And I asked this person about it

752
00:38:34,640 --> 00:38:37,279
Speaker 1: and she said, quote, it changed my life. So how

753
00:38:37,280 --> 00:38:39,279
Speaker 1: about that? I mean, so that's got to be pretty good.

754
00:38:40,440 --> 00:38:43,320
Speaker 9: It is spectacular. And I started to interrupt you, but

755
00:38:43,400 --> 00:38:45,200
Speaker 9: it's the best part of my job when I run

756
00:38:45,239 --> 00:38:49,040
Speaker 9: into one of our users. Literally, it's so great to

757
00:38:49,080 --> 00:38:49,880
Speaker 9: hear their stories.

758
00:38:50,080 --> 00:38:53,120
Speaker 1: Yep, you got some happy campers on the Jersey Shore.

759
00:38:53,120 --> 00:38:56,000
Speaker 1: I want to ask you about kind of the market opportunity.

760
00:38:56,040 --> 00:38:58,240
Speaker 1: I know in twenty twenty four you're thinking about getting

761
00:38:58,320 --> 00:39:00,720
Speaker 1: a CGM product that can be utilized by the twenty

762
00:39:00,719 --> 00:39:03,719
Speaker 1: eight million diabetic patients in the US that do not

763
00:39:04,160 --> 00:39:08,000
Speaker 1: use insulin. What's the status of that role out and development.

764
00:39:09,280 --> 00:39:12,360
Speaker 9: That product is in development right now. We will build

765
00:39:12,360 --> 00:39:16,120
Speaker 9: it around our G seven technology from hardware and an

766
00:39:16,200 --> 00:39:19,640
Speaker 9: accuracy performance perspective, but we want to create a different

767
00:39:19,680 --> 00:39:23,120
Speaker 9: experience for those individuals, an experience that focuses more on

768
00:39:23,480 --> 00:39:27,239
Speaker 9: their lifestyle, on the effects of nutrition, exercise, and things

769
00:39:27,239 --> 00:39:30,640
Speaker 9: that they do taking their medications. You know, somebody who's

770
00:39:30,640 --> 00:39:33,120
Speaker 9: on insulin, this is something that really does change their

771
00:39:33,120 --> 00:39:36,280
Speaker 9: life because they rely on the alerts and the alarms

772
00:39:36,320 --> 00:39:39,359
Speaker 9: and the integration of that product. Somebody would type two

773
00:39:39,400 --> 00:39:41,920
Speaker 9: diabetes not on insulin. What they really need more is

774
00:39:41,960 --> 00:39:45,239
Speaker 9: to understand how their body works and understand their health

775
00:39:45,239 --> 00:39:48,600
Speaker 9: and understand what all the things they can do to

776
00:39:48,719 --> 00:39:51,960
Speaker 9: make them more healthy to keep diabetes from progressing and advancing.

777
00:39:52,600 --> 00:39:55,360
Speaker 9: And we are working on that. We're developing a completely

778
00:39:55,480 --> 00:39:58,640
Speaker 9: new software experience for that product will be based on

779
00:39:58,640 --> 00:40:03,040
Speaker 9: our G seven technology. We will submit that product to

780
00:40:03,080 --> 00:40:04,719
Speaker 9: the FDA before the end of the year, and then

781
00:40:04,760 --> 00:40:06,439
Speaker 9: we hope to launch it in twenty twenty four.

782
00:40:06,840 --> 00:40:09,520
Speaker 5: And do you expect this to get broad coverage from

783
00:40:09,520 --> 00:40:13,080
Speaker 5: insurers as well? Because I think there's probably a group

784
00:40:13,120 --> 00:40:16,000
Speaker 5: of people who want to know about their and don't

785
00:40:16,000 --> 00:40:18,040
Speaker 5: want to know about their health because they need to,

786
00:40:19,080 --> 00:40:22,840
Speaker 5: and others that just want to know. How broad do

787
00:40:22,840 --> 00:40:25,839
Speaker 5: you see the market? And then I guess what's your

788
00:40:25,880 --> 00:40:27,520
Speaker 5: thinking with respect to coverage.

789
00:40:28,520 --> 00:40:30,840
Speaker 9: Out of the gate, we'll have a cash pay option,

790
00:40:31,160 --> 00:40:34,480
Speaker 9: and then we will continue to accumulate data in studies

791
00:40:34,920 --> 00:40:37,279
Speaker 9: to make a case for reimbursement. You know, we've run

792
00:40:37,360 --> 00:40:42,160
Speaker 9: numerous studies in this area. Every time we put patients

793
00:40:42,200 --> 00:40:45,080
Speaker 9: on CGM, they get better outcomes than they had before

794
00:40:45,680 --> 00:40:47,280
Speaker 9: significant ae C drops.

795
00:40:48,520 --> 00:40:49,360
Speaker 7: One of the other.

796
00:40:49,360 --> 00:40:53,400
Speaker 9: Statistics that's measured for people with diabetes is time and range.

797
00:40:53,600 --> 00:40:55,920
Speaker 9: How much time during the day are you in a

798
00:40:55,960 --> 00:40:59,520
Speaker 9: healthy range. We had a seven thousand patient study that

799
00:40:59,560 --> 00:41:03,439
Speaker 9: we talk about at ADA where people experience the forty

800
00:41:03,440 --> 00:41:06,800
Speaker 9: percent improvement in time and range by wearing a CGM

801
00:41:07,040 --> 00:41:09,319
Speaker 9: who are not on inst I have type two diabetes.

802
00:41:09,840 --> 00:41:12,319
Speaker 9: That time and range is what really leads to long

803
00:41:12,440 --> 00:41:15,960
Speaker 9: term and short term better health, and so as we

804
00:41:16,000 --> 00:41:18,920
Speaker 9: will accumulate data like that and ultimately seek reimbursement for

805
00:41:19,000 --> 00:41:20,000
Speaker 9: people in this market.

806
00:41:20,080 --> 00:41:22,239
Speaker 4: Yes, what's the.

807
00:41:22,200 --> 00:41:27,800
Speaker 5: Impact of the rise and interest in GLP one drugs,

808
00:41:27,920 --> 00:41:30,719
Speaker 5: which I know are diabetes drugs, but you know the

809
00:41:30,760 --> 00:41:33,319
Speaker 5: ideas that you can use them for more than just

810
00:41:33,400 --> 00:41:34,280
Speaker 5: diabetes alone.

811
00:41:35,840 --> 00:41:38,520
Speaker 9: We think it's a natural fit for us. In all honesty,

812
00:41:38,600 --> 00:41:42,360
Speaker 9: CGM delivers information you can't get any place else. And

813
00:41:42,800 --> 00:41:45,640
Speaker 9: as I've spoken with physicians who use GLP once and

814
00:41:45,680 --> 00:41:49,879
Speaker 9: CGM combined, what they tell us is these individuals learn

815
00:41:49,920 --> 00:41:52,319
Speaker 9: from the CGM the effect that the change in their

816
00:41:52,360 --> 00:41:55,880
Speaker 9: eating habits brought on by the golp ones. You know

817
00:41:55,920 --> 00:41:58,080
Speaker 9: what it does to their bodies. So they learn from that,

818
00:41:58,440 --> 00:42:01,360
Speaker 9: and so I think can go hand in hand. I

819
00:42:01,400 --> 00:42:04,399
Speaker 9: think in this weight loss environment. Also, for example, I've

820
00:42:04,880 --> 00:42:07,520
Speaker 9: spoke on physicians who put people on golp ones for

821
00:42:07,560 --> 00:42:09,640
Speaker 9: some period of time that if they take them off,

822
00:42:10,480 --> 00:42:12,279
Speaker 9: how do they know what's going on? How do they

823
00:42:12,320 --> 00:42:14,560
Speaker 9: know they haven't reverted back to their old habits. It's

824
00:42:14,680 --> 00:42:17,080
Speaker 9: very simple. You can put them on a CGM and

825
00:42:17,120 --> 00:42:19,520
Speaker 9: they can see what their glucose values do I wonder.

826
00:42:19,320 --> 00:42:21,799
Speaker 5: If that'sable, if a coverable.

827
00:42:21,280 --> 00:42:25,520
Speaker 9: Thing hopefully over time, Yeah, we think it will be.

828
00:42:25,840 --> 00:42:29,239
Speaker 1: Hey, Kevin, just real quick here, thirty seconds left. Give

829
00:42:29,320 --> 00:42:31,560
Speaker 1: us a sense of your competitive environment here both in

830
00:42:31,560 --> 00:42:32,680
Speaker 1: the US and then globally.

831
00:42:34,120 --> 00:42:38,279
Speaker 9: It's a very competitive environment. US and Abbot are the

832
00:42:38,320 --> 00:42:41,799
Speaker 9: two largest companies in the space. But the environment is

833
00:42:41,800 --> 00:42:44,040
Speaker 9: so big, and the need is so on men, and

834
00:42:44,080 --> 00:42:46,440
Speaker 9: the information is so important. Again, you look at our

835
00:42:46,480 --> 00:42:49,840
Speaker 9: growth numbers and the opportunity we have in front of

836
00:42:49,920 --> 00:42:53,680
Speaker 9: us will continue to compete very well. It is a

837
00:42:53,760 --> 00:42:55,640
Speaker 9: great problem.

838
00:42:55,280 --> 00:42:56,200
Speaker 7: To solve for us.

839
00:42:56,440 --> 00:42:59,359
Speaker 1: And is this the opportunity outside the US? Is it

840
00:42:59,480 --> 00:43:02,200
Speaker 1: just depend upon the I guess the development of the

841
00:43:02,239 --> 00:43:03,240
Speaker 1: healthcare system there.

842
00:43:04,080 --> 00:43:07,120
Speaker 9: It very frequently depends upon the reimbursement and the geography

843
00:43:07,480 --> 00:43:09,160
Speaker 9: that we're trying to go to and where we don't

844
00:43:09,160 --> 00:43:12,000
Speaker 9: have reimbursement. One of the things we kicked off this

845
00:43:12,120 --> 00:43:14,440
Speaker 9: year is we do launch cash pay options in those

846
00:43:14,840 --> 00:43:17,480
Speaker 9: countries through an e commerce platform, and a couple of

847
00:43:17,520 --> 00:43:21,440
Speaker 9: times it's already led to the government's changing their position

848
00:43:21,480 --> 00:43:24,400
Speaker 9: on reimbursement and covering our product because they see how

849
00:43:24,440 --> 00:43:27,719
Speaker 9: many people literally rush to the cash option to buy

850
00:43:27,760 --> 00:43:29,000
Speaker 9: it all.

851
00:43:28,920 --> 00:43:31,120
Speaker 1: Right, Kevin, thanks for checking in with us. We appreciate it.

852
00:43:31,200 --> 00:43:34,000
Speaker 1: Kevin Sayer is the CEO of dex Com.

853
00:43:34,280 --> 00:43:35,560
Speaker 7: You're listening to the tape.

854
00:43:35,680 --> 00:43:39,040
Speaker 6: Ken's our live program Bloomberg Markets weekdays at ten am

855
00:43:39,040 --> 00:43:43,200
Speaker 6: Eastern on Bloomberg Radio, the tune in app, Bloomberg dot Com.

856
00:43:42,880 --> 00:43:44,360
Speaker 7: And the Bloomberg Business App.

857
00:43:44,360 --> 00:43:47,200
Speaker 6: You can also listen live on Amazon Alexa from our

858
00:43:47,200 --> 00:43:51,600
Speaker 6: flagship New York station. Just say Alexa play Bloomberg eleven thirty.

859
00:43:53,239 --> 00:43:56,800
Speaker 5: This is Simon and Paul. We've been around all morning

860
00:43:56,920 --> 00:44:00,040
Speaker 5: and we're here for another couple another twenty minutes or so.

861
00:44:00,840 --> 00:44:05,239
Speaker 5: Really interested in our next guest because part because of

862
00:44:05,320 --> 00:44:09,640
Speaker 5: the name, which is Shark Ninja. Mark Rosenswig is CEO

863
00:44:09,680 --> 00:44:12,719
Speaker 5: of Shark Ninja and they just rang the New York

864
00:44:12,719 --> 00:44:16,719
Speaker 5: Stock Exchange bell this morning, publicly traded, and they've been

865
00:44:16,719 --> 00:44:19,600
Speaker 5: through a little bit of an interesting corporate history. So

866
00:44:19,719 --> 00:44:22,680
Speaker 5: this is the maker both of those Shark vacuums and

867
00:44:22,960 --> 00:44:27,680
Speaker 5: Ninja blenders. They were a part of a Hong Kong

868
00:44:27,760 --> 00:44:32,680
Speaker 5: listed company, apropos of our previous conversation, but now they

869
00:44:32,680 --> 00:44:36,919
Speaker 5: have gone public and shares, yeah, through a spin out here.

870
00:44:36,960 --> 00:44:39,680
Speaker 5: So Mark I want to bring you on as well.

871
00:44:40,360 --> 00:44:46,080
Speaker 5: Looks like shares jumping higher in New York after this

872
00:44:46,320 --> 00:44:51,040
Speaker 5: spin off today, talk me through why go it alone?

873
00:44:51,200 --> 00:44:53,560
Speaker 5: Why spin out from JS Global?

874
00:44:55,000 --> 00:44:59,480
Speaker 13: Yeah, well, thanks for having me. Look, Shark Ninja has

875
00:44:59,520 --> 00:45:03,399
Speaker 13: a great story to tell, and we believe that it's

876
00:45:03,840 --> 00:45:06,040
Speaker 13: the right place to tell that story is the New

877
00:45:06,160 --> 00:45:10,560
Speaker 13: York Stock Exchange. Shark Ninja goes to market under two

878
00:45:10,680 --> 00:45:14,360
Speaker 13: really well respected brands, as you mentioned, the Shark brand,

879
00:45:14,360 --> 00:45:18,160
Speaker 13: which is a market leader in cleaning, home, environment and beauty,

880
00:45:18,520 --> 00:45:21,399
Speaker 13: and the Ninja brand, which does just about everything in

881
00:45:21,440 --> 00:45:25,480
Speaker 13: the kitchen and has now gone outside with our outdoor

882
00:45:25,520 --> 00:45:29,680
Speaker 13: cooking appliances. We have a story of scale, nearly four

883
00:45:29,680 --> 00:45:33,520
Speaker 13: billion dollars of revenue. We have a story of profitability.

884
00:45:33,560 --> 00:45:37,640
Speaker 13: The business is highly profitable, and we have a story

885
00:45:37,680 --> 00:45:41,320
Speaker 13: of growth and a demonstrated track record of organic growth.

886
00:45:41,640 --> 00:45:43,600
Speaker 13: You know, we were a business back in two thousand

887
00:45:43,640 --> 00:45:45,840
Speaker 13: and eight that was less than two hundred million dollars

888
00:45:45,880 --> 00:45:49,640
Speaker 13: in revenue. Today nearly four billion. You know, all of

889
00:45:49,680 --> 00:45:52,440
Speaker 13: that has been organic. We've never acquired a dollar of

890
00:45:52,520 --> 00:45:56,520
Speaker 13: revenue in the company's history, and so we really believe

891
00:45:56,600 --> 00:45:58,759
Speaker 13: that you know the right place for us is to

892
00:45:58,800 --> 00:46:01,760
Speaker 13: be a standalone business on the New York Stock Exchange.

893
00:46:01,920 --> 00:46:06,160
Speaker 5: Now, it's my impression you were the largest part of

894
00:46:06,520 --> 00:46:09,400
Speaker 5: js Global or Shark Ninja was the largest part of

895
00:46:09,480 --> 00:46:12,520
Speaker 5: Jazz Global. How did it come about that, you guys

896
00:46:12,840 --> 00:46:13,920
Speaker 5: went your separate ways.

897
00:46:15,800 --> 00:46:20,800
Speaker 13: Well, you know, Shark Ninja was owned by my partner

898
00:46:21,000 --> 00:46:24,760
Speaker 13: Mark and I up until twenty seventeen, when we sold

899
00:46:24,760 --> 00:46:28,040
Speaker 13: a majority stake in the business. We really wanted to

900
00:46:28,080 --> 00:46:31,919
Speaker 13: bring a partner in to help globalize the business. Five

901
00:46:31,960 --> 00:46:34,560
Speaker 13: and a half years later, the business is nearly has

902
00:46:34,640 --> 00:46:36,320
Speaker 13: more than doubled in size.

903
00:46:37,239 --> 00:46:38,080
Speaker 7: You know, we have a.

904
00:46:38,120 --> 00:46:43,560
Speaker 13: Fast approaching billion dollar business outside of North America. You know,

905
00:46:43,680 --> 00:46:47,440
Speaker 13: we you know, our customers, our consumers, you know are

906
00:46:47,480 --> 00:46:49,560
Speaker 13: here in the United States. The United States are the

907
00:46:49,640 --> 00:46:53,840
Speaker 13: largest market for us. We're based in Boston. We have

908
00:46:53,880 --> 00:46:57,280
Speaker 13: a team of almost a thousand folks just outside of Boston.

909
00:46:58,040 --> 00:47:01,520
Speaker 13: And so we really felt like being a subsidiary of

910
00:47:01,560 --> 00:47:04,239
Speaker 13: a Hong Kong listed company wasn't the right place to

911
00:47:04,280 --> 00:47:05,040
Speaker 13: tell the story.

912
00:47:05,920 --> 00:47:08,560
Speaker 1: All right, So for your company, and I'm not familiar

913
00:47:08,600 --> 00:47:10,640
Speaker 1: with your company, I have to admit talk to us

914
00:47:10,640 --> 00:47:14,520
Speaker 1: about kind of your distribution model and kind of how

915
00:47:14,520 --> 00:47:15,200
Speaker 1: that's evolved.

916
00:47:17,040 --> 00:47:19,560
Speaker 13: Yeah, So the distribution model is that, you know, we

917
00:47:19,600 --> 00:47:24,720
Speaker 13: sell to every major retailer in North America, in Europe.

918
00:47:25,600 --> 00:47:27,920
Speaker 13: You know, we have a very strong dot com business.

919
00:47:28,000 --> 00:47:30,799
Speaker 13: Our brands are the most search brands in our categories

920
00:47:30,840 --> 00:47:34,279
Speaker 13: on Amazon, and we have a really healthy direct to

921
00:47:34,320 --> 00:47:39,040
Speaker 13: consumer business. So our distribution model has really been based

922
00:47:39,080 --> 00:47:42,320
Speaker 13: on the idea that we want to be relevant where

923
00:47:42,360 --> 00:47:45,719
Speaker 13: the consumer chooses to shop for our products, if that

924
00:47:45,840 --> 00:47:48,120
Speaker 13: happens to be in a retail store, grade, if it

925
00:47:48,160 --> 00:47:51,719
Speaker 13: happens to be direct to consumer or go online. But

926
00:47:51,800 --> 00:47:54,759
Speaker 13: that really is kind of how the model is not

927
00:47:54,960 --> 00:47:57,600
Speaker 13: just in the US, but really in every market that

928
00:47:57,640 --> 00:47:58,760
Speaker 13: we sell.

929
00:47:58,920 --> 00:48:01,319
Speaker 1: Mark talk to us at the decision to spin off

930
00:48:01,480 --> 00:48:04,600
Speaker 1: as opposed to perhaps an IPO, how did that play out?

931
00:48:06,200 --> 00:48:06,719
Speaker 7: Well?

932
00:48:06,840 --> 00:48:10,759
Speaker 13: When we made the decision to spin out and be

933
00:48:10,920 --> 00:48:13,560
Speaker 13: a publicly listed company, you know, that was going back

934
00:48:13,560 --> 00:48:15,799
Speaker 13: a number of months ago, and at the time, the

935
00:48:15,840 --> 00:48:20,200
Speaker 13: IPO market in the US was quite challenged, and so

936
00:48:20,880 --> 00:48:24,120
Speaker 13: you know, we really wanted certainty to become a US

937
00:48:24,120 --> 00:48:27,000
Speaker 13: public company, and this gave us the most certainty to

938
00:48:27,040 --> 00:48:29,480
Speaker 13: be able to do that. We think we have a

939
00:48:29,480 --> 00:48:34,279
Speaker 13: great story. We think when investors hear the story. You know,

940
00:48:34,360 --> 00:48:37,279
Speaker 13: many of these investors are already consumers of ours. I mean,

941
00:48:37,280 --> 00:48:40,000
Speaker 13: our products are loved you know in in you know,

942
00:48:40,080 --> 00:48:45,319
Speaker 13: millions and millions of homes across America. You know, investors

943
00:48:45,320 --> 00:48:48,320
Speaker 13: will respond and and you know we will become a

944
00:48:48,960 --> 00:48:51,680
Speaker 13: company of interest, you know, for for investors on the

945
00:48:51,680 --> 00:48:52,800
Speaker 13: New York Stock Exchange.

946
00:48:53,960 --> 00:48:57,080
Speaker 5: Talk to me about what you're seeing from consumers at

947
00:48:57,120 --> 00:49:01,520
Speaker 5: the moment. Are you there has been some shift away

948
00:49:01,560 --> 00:49:06,839
Speaker 5: from consumer discretionary products because consumers are feeling a pinch

949
00:49:06,840 --> 00:49:10,080
Speaker 5: in their wallets. Are you seeing that or are you

950
00:49:10,400 --> 00:49:13,960
Speaker 5: seeing consumers switched to different kinds of products.

951
00:49:15,680 --> 00:49:21,040
Speaker 13: Look, I mean we're obviously you know, concern for consumers

952
00:49:21,040 --> 00:49:24,200
Speaker 13: and the inflationary challenges that they've had over the course

953
00:49:24,239 --> 00:49:27,680
Speaker 13: of the last few years. You know, we believe that

954
00:49:27,719 --> 00:49:34,080
Speaker 13: Shark Ninja delivers incredible performance, high quality and reliable products,

955
00:49:34,120 --> 00:49:37,040
Speaker 13: and we do it at an extraordinary value to the consumer.

956
00:49:37,480 --> 00:49:39,839
Speaker 13: We're not the highest priced products in the market, we're

957
00:49:39,840 --> 00:49:42,799
Speaker 13: not the lowest price, but we think that when the

958
00:49:42,840 --> 00:49:46,480
Speaker 13: consumer buys a Sharker Ninja product, they're really, you know,

959
00:49:46,600 --> 00:49:49,959
Speaker 13: getting extraordinary value. And I think that when you read

960
00:49:50,080 --> 00:49:54,280
Speaker 13: consumer reviews of what people write about Shark and Ninja products.

961
00:49:54,360 --> 00:49:57,680
Speaker 13: You'll see that coming through in those reviews. So, you know,

962
00:49:57,719 --> 00:49:59,920
Speaker 13: we're a business that's grown fourteen out of the last

963
00:50:00,160 --> 00:50:03,800
Speaker 13: fifteen years. We have strong growth in our first quarter.

964
00:50:04,840 --> 00:50:08,520
Speaker 13: So we believe that if we can continue to give

965
00:50:08,600 --> 00:50:14,160
Speaker 13: exciting innovation to consumers that solve their problems and continue

966
00:50:14,160 --> 00:50:16,880
Speaker 13: to do it at a great value, that the consumer

967
00:50:16,960 --> 00:50:17,600
Speaker 13: will respond.

968
00:50:18,440 --> 00:50:21,279
Speaker 1: Mark what are the growth drivers over the next year

969
00:50:21,320 --> 00:50:23,160
Speaker 1: to two for you guys?

970
00:50:24,160 --> 00:50:26,840
Speaker 13: So for us, it's the same growth drivers that have

971
00:50:26,880 --> 00:50:29,080
Speaker 13: been really in the business over the last you know,

972
00:50:29,200 --> 00:50:34,800
Speaker 13: eight years. We've developed three strong pillars of organic growth,

973
00:50:34,840 --> 00:50:38,080
Speaker 13: and that's the important word. They're organic, you know. The

974
00:50:38,160 --> 00:50:42,440
Speaker 13: first is, you know, gaining share in the existing categories

975
00:50:42,440 --> 00:50:46,680
Speaker 13: that we participate in. We're in big, definable categories and

976
00:50:46,719 --> 00:50:49,920
Speaker 13: Shark Ninja has a demonstrated track record of being able

977
00:50:49,960 --> 00:50:53,759
Speaker 13: to gain share in those categories. The second is expanding

978
00:50:53,800 --> 00:50:57,960
Speaker 13: into new and adjacent product categories. We've expanded into ten

979
00:50:58,040 --> 00:51:02,120
Speaker 13: new categories just over the last three years. Categories like

980
00:51:02,200 --> 00:51:06,000
Speaker 13: beauty with our Shark Flex style hair dryer, categories like

981
00:51:06,040 --> 00:51:09,799
Speaker 13: outdoor cooking with our Ninja wood fire grill. And the

982
00:51:09,840 --> 00:51:12,839
Speaker 13: third is international expansion. I mentioned earlier that we are

983
00:51:12,920 --> 00:51:16,799
Speaker 13: fast approaching a billion dollars in revenue outside of North America.

984
00:51:17,280 --> 00:51:20,480
Speaker 13: So there's real scale in our international business, but there's

985
00:51:20,520 --> 00:51:24,520
Speaker 13: still tremendous opportunity. I mean, Shark Ninja sells in twenty

986
00:51:24,560 --> 00:51:29,000
Speaker 13: five countries around the world. We sell in twenty seven

987
00:51:29,120 --> 00:51:33,480
Speaker 13: different product categories. We believe that there's more product categories

988
00:51:33,480 --> 00:51:35,839
Speaker 13: for us to enter into, and we believe there's more

989
00:51:35,880 --> 00:51:40,080
Speaker 13: markets for us to expand into. So that's really you know,

990
00:51:40,520 --> 00:51:42,320
Speaker 13: driving those pillars of growth.

991
00:51:42,320 --> 00:51:45,319
Speaker 1: Okay, excellent, Mark, thanks so much for joining us. We

992
00:51:45,360 --> 00:51:49,400
Speaker 1: appreciate it. Mark barakas CEO and president of Shark Ninja.

993
00:51:49,920 --> 00:51:53,040
Speaker 2: Thanks for listening to the Bloomberg Markets podcast. You can

994
00:51:53,040 --> 00:51:56,840
Speaker 2: subscribe and listen to interviews at Apple Podcasts or whatever

995
00:51:56,920 --> 00:52:00,640
Speaker 2: podcast platform you prefer. I'm Matt Miller. I'm on Twitter

996
00:52:00,840 --> 00:52:02,920
Speaker 2: at Matt Miller nineteen seventy three.

997
00:52:03,239 --> 00:52:05,680
Speaker 1: And I'm Faull Sweeney. I'm on Twitter at pt Sweeney.

998
00:52:05,719 --> 00:52:08,360
Speaker 1: Before the podcast, you can always catch us worldwide at

999
00:52:08,400 --> 00:52:09,160
Speaker 1: Bloomberg Radio