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Speaker 3: short term rally.
Speaker 1: Bloomberg Intelligence with Scarletfoo and Paul Sweeney on Bloomberg Radio, YouTube,
Speaker 1: and Bloomberg Originals.
Speaker 2: On today's Bloomberg Intelligence Show, we dig inside the big
Speaker 2: business stories impacting Wall Street and the global markets. Each
Speaker 2: and every week, we provide in depth research and data
Speaker 2: on some of the two thousand companies and one hundred
Speaker 2: and thirty industries our animalts cover worldwide. Today, we'll look
Speaker 2: at why the Trump administration is warning about tiele on
Speaker 2: all use during pregnancy. Plus we'll look at what's in
Speaker 2: store for the telecommunications company T Mobile after naming a
Speaker 2: new CEO. But first we begin in the anti trust Space.
Speaker 2: We recently heard that the US Federal Trade Commission and
Speaker 2: seven states have sued Live Nation Entertainment and its ticket
Speaker 2: Master subsidiary. It's for failing to prevent the use of
Speaker 2: automated ticketing bots and large scale resale operations. From more
Speaker 2: co hosts, Scarlettfield and I were joined by Jennifer Ree,
Speaker 2: Bloomberg Intelligence Senior litigation analyst. We first asked for Jens
Speaker 2: first impressions on the latest news.
Speaker 4: Well, I think, first of all, not too much of
Speaker 4: a surprise, because they did recently sue a much smaller
Speaker 4: entity over the same law, which is called the Better
Speaker 4: Ticketing Online Sales Act or the Bots Act, and Live
Speaker 4: Nation was mentioned an awful lot in that lawsuit, so
Speaker 4: it sort of led to the conclusion that there might
Speaker 4: be another suit brought. And President Trump did order the
Speaker 4: Federal Trade Commission to better enforce this act back in
Speaker 4: an executive order in March, and they have a report
Speaker 4: due to the President on September twenty seventh, so saying
Speaker 4: what if they done to better enforce the act. So
Speaker 4: I think it's not a surprise that a big lawsuit
Speaker 4: came down before that report is due.
Speaker 2: You know, you talk you talk to a lot of
Speaker 2: nation people, and I've known them for a long time.
Speaker 2: I think they want to clean this stuff up. They
Speaker 2: want to take out the middleman, the scalper. They want
Speaker 2: to simplify the fees because they know the feedback is
Speaker 2: terrible from their customers. But this is still a thing,
Speaker 2: isn't it.
Speaker 4: I mean yeah, no, right, Well, first of all, antitrust
Speaker 4: cases tend to be backward looking, so what they may
Speaker 4: be taking efforts today, but we're looking at what they've
Speaker 4: been doing since twenty eighteen. Essentially. The other thing is
Speaker 4: they do say that, and they have said that to
Speaker 4: the Department of Justice and to Congress as well. But
Speaker 4: if you look at what's been alleged in this lawsuit,
Speaker 4: they're an awful lot of statements and documents cited to
Speaker 4: when their internal business communications going on. That suggests that
Speaker 4: they've kind of turned a blind eye to the broker
Speaker 4: activity because they profit from the resale market of those
Speaker 4: tickets as well. How did they do that well, because
Speaker 4: they sell the primary ticket and take fees, and then
Speaker 4: the brokers buy in bulk and then they put it
Speaker 4: they resell on Ticketmaster's resale arm. Ticketmaster charges just to
Speaker 4: list it and then they take another fee when the
Speaker 4: ticket's actually sold, So they're basically double dipping on the
Speaker 4: same ticket.
Speaker 2: How is this different?
Speaker 3: I know that's not good. How is this different from
Speaker 3: what ticket resellers, vivid Seats or access or any of
Speaker 3: those other companies that consumers have the option of using,
Speaker 3: how they operate and how they collect fees.
Speaker 4: So this is about whether they knowingly resell these tickets. Now,
Speaker 4: a reseller could sell a ticket that's been bought improperly
Speaker 4: by a bot but not know it. They could implement
Speaker 4: security measures, not understand the extent to which the bots
Speaker 4: in the scalpers have been able to technically go around
Speaker 4: those security measures, and then, you know, in an honestly
Speaker 4: attempt to provide a place to resell tickets, resell the tickets.
Speaker 4: In this case, what the FTC is saying is that
Speaker 4: Ticketmaster knowingly did this, and they didn't step in the way,
Speaker 4: They didn't implement any of the rules that they have
Speaker 4: internally to.
Speaker 2: Let it happen.
Speaker 4: They let it happen. So it remains to be seen
Speaker 4: whether some of the other resellers have that same kind
Speaker 4: of evidence internally. It may be that they're doing what
Speaker 4: they can to prevent the conduct and in that case
Speaker 4: it may not violate the Bots Act.
Speaker 2: How about the Department of Justice, what are they doing
Speaker 2: with this company? I mean, is there talk of breaking
Speaker 2: up Live Nation from the Ticketmaster?
Speaker 4: The Department of Justice has been going after this company
Speaker 4: for years, ever since Live Nation acquired Ticketmaster, which yes, Paul,
Speaker 4: I know you worked on that deal, right, and that
Speaker 4: was done with the consent order, meaning Live Nation promised
Speaker 4: to behave a certain way if they were allowed to
Speaker 4: buy the company, and essentially it's been alleged and investigated
Speaker 4: and found twice now that they violated that. So now
Speaker 4: the Department of Justice has just sued them and said,
Speaker 4: you're engaging in all kinds of anti competitive activity by
Speaker 4: virtue of your strong position kind of in every aspect
Speaker 4: of the live concert and live event industry. And you
Speaker 4: know the only answer at this point is to force
Speaker 4: you to sell Ticketmaster because when we impose behavioral conditions,
Speaker 4: you just ignore it.
Speaker 3: How do you see this resolving. Is this going to
Speaker 3: be something where they battle it out to the very
Speaker 3: end and get a verdict or are they going to
Speaker 3: try to settle.
Speaker 4: Well, I think two different answers depending on the lawsuit
Speaker 4: I think on the FTC lawsuit over the Bots Act
Speaker 4: probably ends in a settlement because the penalties are astronomical,
Speaker 4: you know, over fifty three thousand dollars per violation, and
Speaker 4: we're talking about probably five million violations a year, accounting
Speaker 4: and counting right starting in twenty eighteen. So that probably
Speaker 4: ends in a settlement for a fraction of what ultimately
Speaker 4: could be fined the Department of Justice suit. I suspect
Speaker 4: Live Nation will fight and fight for many years. That
Speaker 4: goes to trial in front of a jury in March.
Speaker 4: So we're actually probably going to have a verdict in
Speaker 4: the first quarter unless they managed to finacle a settlement,
Speaker 4: which I understand they're trying hard right now to settle
Speaker 4: with the Trump administration. But if they don't, it goes
Speaker 4: to trial in March. We'll have a jury verdict. I
Speaker 4: think it'll be hard to find a jury that's not
Speaker 4: going to be inclined to rule against Live Nation if
Speaker 4: they've ever tried to buy a ticket.
Speaker 3: For an event like how many finds one who's completely
Speaker 3: impractive about this and has no real firsthand experience exactly.
Speaker 2: Now, I look like as old stock analysts I am,
Speaker 2: I look at the stock, it's a twenty six percent
Speaker 2: yeah day. Is that the market telling me we've got
Speaker 2: an administration in office right now that might be open
Speaker 2: to a deal. Is that kind of what it's saying.
Speaker 4: I think so. I think there are those out there
Speaker 4: that think Live Nation may be able to get some
Speaker 4: sort of a deal. You know, we know they're making
Speaker 4: a lot of efforts to do so in doing things
Speaker 4: the way seem to be have been successful for others
Speaker 4: with this administration, and I do think that's the sentiment.
Speaker 4: But and also it's a long way away from something happening.
Speaker 4: Even if they lose this jury trial in March, then
Speaker 4: the judge has to decide on a remedy, then they appeal,
Speaker 4: that remedy probably gets stayed pending the appeal, So we're
Speaker 4: really not looking at an impact for a couple more years.
Speaker 3: In the meantime, you have artists trying to you know,
Speaker 3: limit how they sell their tickets as well, and that
Speaker 3: just creates confusion for consumers too, you know, like they'll
Speaker 3: release a you know, slate of tickets and then hold
Speaker 3: off and then release another slate of tickets, and if
Speaker 3: you want to transfer tickets to someone it's very different
Speaker 3: goal on the Ticketmaster app because they want to make
Speaker 3: sure that you're an actual person on the bot. I mean,
Speaker 3: it just gets difficult for people who just want to
Speaker 3: go see.
Speaker 4: A show, right, And that's why this is a politically
Speaker 4: popular cause. You know, this is the one thing that
Speaker 4: leads me to think maybe the DJ won't settle with
Speaker 4: Live Nation despite the efforts, because this is really you know,
Speaker 4: the Taylor Swift fiasco brought it all to the forefront
Speaker 4: more than ever. Springsteen whor's Springsteen Right. There have been
Speaker 4: other issues since then, and it is politically popular. See
Speaker 4: what happens there.
Speaker 2: The only way you know, musical folks can make money
Speaker 2: is touring, right.
Speaker 3: And don't get Spotify doesn't pay you anything.
Speaker 2: No, I mean, it's it, that's why you got. I mean,
Speaker 2: I saw Clapton, Eric Clapton.
Speaker 3: And the dude's eighty was sitting the entire time, no.
Speaker 2: No standing most of the time. Sounded great. You know,
Speaker 2: I don't know, but I mean, yeah, you know, there's
Speaker 2: either selling their catalogs for hundreds of millions of dollars, right,
Speaker 2: and they're still touring.
Speaker 4: And merch merch tons and tons, and that's the problem
Speaker 4: with these astronomical ticket prices that doesn't go back to
Speaker 4: the artist, you know, it's just going to the middle
Speaker 4: man or going to Live Nation or Ticketmaster, whoever the
Speaker 4: reseller is.
Speaker 2: Our thanks to Jennifer Ree, Bloomberg Intelligence Senior Litigation Analyst,
Speaker 2: we move next to news from the memory chip maker Micron.
Speaker 2: This week, shares of the company fell after its forecast
Speaker 2: for the first quarter failed to impress investors, and this
Speaker 2: comes despite revenue and profit expectations being higher than estimated.
Speaker 2: In the backdrop, Micron stock has nearly doubled this year,
Speaker 2: rising at a faster pace than most of its chip piers,
Speaker 2: reflecting AI fueled optimism for more. Co host Scarlettfield w
Speaker 2: Anden I were joined by Jake Silverman, Bloomberg Intelligence Semiconductor analyst.
Speaker 2: We first asked Jake why investors were disappointed with Micron.
Speaker 5: I think it has a lot to do with just
Speaker 5: very high expectations coming into the quarter. But overall, look,
Speaker 5: I mean, the fundamentals of the business remained very strong.
Speaker 5: I think the commentary on the call for management was
Speaker 5: very positive, and so I think we're going to continue
Speaker 5: to see an up cycle and memory at least for
Speaker 5: the near term.
Speaker 2: So what is the call here, what's the street looking
Speaker 2: for for this name? Again, A stocks just as you mentioned,
Speaker 2: ripped this year up ninety four percent year today. What's
Speaker 2: the call here?
Speaker 5: Yeah, No, I mean, I think investors are really looking
Speaker 5: at high bandwidth memory, They're looking at AI, They're looking
Speaker 5: at data center related revenue. In the last fiscal year,
Speaker 5: data center related revenue was fifty to six percent of sales.
Speaker 5: So as demand continues for that, we also have to
Speaker 5: keep in mind that, you know, there's traditional products as
Speaker 5: well that are an important part of the business, that
Speaker 5: includes smartphones and PCs. Investors really want to see continued
Speaker 5: pricing strength. And as demand continues to grow for high
Speaker 5: bandwidth memory, which is very important for AI, and as
Speaker 5: capacity for that shifts over to high bandwith memory, it
Speaker 5: can further constrains the supply because it has lower yields,
Speaker 5: it has larger die sizes, so there's only so much
Speaker 5: capacity industry and it's shifting over in favor of AI,
Speaker 5: and that's just constraining supply for traditional products. Which given
Speaker 5: the supply and demand, the importance of supplying demand balancing
Speaker 5: the industry, it would suggest that as long as demand
Speaker 5: for AI continues to grow, we'll see further pricing increases.
Speaker 3: So that's a lot of conditions. I mean, you talk
Speaker 3: about memory chips, which Micron is the biggest US maker of.
Speaker 3: We know that this business is kind of famous or
Speaker 3: infamous really for merging between booms and busts, and that
Speaker 3: results in these price wings to compensate for the previous
Speaker 3: you know, plethora of chips or dearth of chips. How
Speaker 3: does the AI revolution change this dynamic?
Speaker 4: Yeah?
Speaker 5: No, And as I said before, really I want to
Speaker 5: put emphasis on the fact that high bandwidth memory demand
Speaker 5: constrain the supply for other products, specifically with DRAM. But
Speaker 5: DRAM now accounts for about eighty percent of sales for
Speaker 5: the company, so it's vastly more important than what we're
Speaker 5: seeing in NAND. But the other twenty percent of sales
Speaker 5: in NAND, we're also seeing strength for enterprise solid state drives,
Speaker 5: which are also important for AI. So yeah, look, I
Speaker 5: mean I think historically we've seen cycles up cycles tend
Speaker 5: to last somewhere between seven to ten quarters, but we're
Speaker 5: now extending beyond that. I mean, we're looking at, based
Speaker 5: on the guidance, at least twelve quarters and then based
Speaker 5: on the potential for further increases in pricing, it could
Speaker 5: extend all the way through the next fiscal yeur at
Speaker 5: a minimum. So yeah, I mean, really it's just kind
Speaker 5: of an almost unprecedented situation, or at least not something that
Speaker 5: we've seen in a very long time. And it really
Speaker 5: just comes from structural tailments from AI, both on demand,
Speaker 5: which is improving pricing via different products like high manWith memory,
Speaker 5: but also just because like I said before, it's just
Speaker 5: constraining overall supply, and that's not just unique to Micron,
Speaker 5: that's true for both Skee Heinex and Samsung as well,
Speaker 5: and the three of them account for the vast majority
Speaker 5: of DRAM demand in the industry in nand as well.
Speaker 2: Yeah, Drake, that's kind kind of where I wanted to
Speaker 2: go the competitive landscape here. It feels like there's again
Speaker 2: you mentioned kind of three names there. Is that really
Speaker 2: kind of what's driving? Are those three companies driving this business?
Speaker 6: Yeah?
Speaker 5: Yeah, yeah, so eske Heinez has really had the lead
Speaker 5: in high bandwidth memory, Micron has become sort of a
Speaker 5: very fast follower, and now there's reports that Samsung will
Speaker 5: be supplying into Nvidia's Blackwell Ultra platform, which might pave
Speaker 5: the way into Rubin for them as well. So I mean,
Speaker 5: I think this three company dynamic that we'd seen for
Speaker 5: a very long time. Obviously you've had some Chinese competitors
Speaker 5: come on, but this three company dynamic that we saw
Speaker 5: in traditional DRAM seems to be now shaping up again
Speaker 5: for high bandwidth memory. So I think those past dynamics
Speaker 5: that we've seen are going to be the dynamics going
Speaker 5: forward again.
Speaker 2: Our thanks to Jake Silverman, Bloomberg Intelligence semiconductor analyst, coming
Speaker 2: up a look at how US drug Makropfiser is trying
Speaker 2: to carve its share of the BCD DRUB market. You're
Speaker 2: listening to Bloomberg Intelligence on Bloomberg Radio, providing in depth
Speaker 2: research and data on two thousand companies and one hundred
Speaker 2: and thirty industries. You can access Bloomberg Intelligence VI A B.
Speaker 2: I go on the terminal. I'm Paul Sweeney and this
Speaker 2: is Bloomberg.
Speaker 1: This is Bloomberg Intelligence with Scarlet Foo and Paul Sweeney
Speaker 1: on Bloomberg Radio.
Speaker 2: We move now to the news in a pharmaceutical space.
Speaker 2: This week, the US drugmaker Pfizer said it will pay
Speaker 2: four point nine billion dollars for the obesity startup met Sarah,
Speaker 2: it's a bid to catch up the rival drugmakers after
Speaker 2: failing to compete with its own weight loss medications From
Speaker 2: work co hosts Scarlett Foe when I were joined by
Speaker 2: Sam Fazzelli, Bloomberg Intelligence, Director of Research for Global Industries
Speaker 2: and senior pharmaceuticals analysts. We first asked Sam to give
Speaker 2: us some context on why this deal is important.
Speaker 7: Obesity is one of the key causes of a whole
Speaker 7: variety of diseases, cardiovascular, cancer, mental health. So if we
Speaker 7: can treat it, if we can prevent it, if we
Speaker 7: can reduce it, it's brilliant for the entirety of society.
Speaker 7: Here there is a deal where Fizer thinks they've got
Speaker 7: something that's going to be able to give them a
Speaker 7: chance at playing in this very important area and very
Speaker 7: massive market. Right. So the drugs are interesting, they're relatively
Speaker 7: early stage. We're looking to see with some new data
Speaker 7: coming up, whether some of the promise that we've seen
Speaker 7: earlier for these drugs that the company has, which the
Speaker 7: latest stage one is still in phase two they need
Speaker 7: to start the phase three in twenty twenty six, whether
Speaker 7: they are as competitive as they looked in the earlier trials.
Speaker 7: There were some questions on efficacy less so than side
Speaker 7: effect profile. So we'll have to wait and see how
Speaker 7: that pans out.
Speaker 3: Sam, can you get into the science a little bit
Speaker 3: and maybe you know, keep it basic for folks like
Speaker 3: Paul and me, because Metzara is described as the next
Speaker 3: generation hopeful in obesities. They use these long acting analogs
Speaker 3: versus GLP one and I'm wondering for people who might
Speaker 3: be holding out for matsera's treatment what that means versus
Speaker 3: the currently available zip bound or we go vi.
Speaker 7: Yeah. Yeah, So the latest stage drug is very similar
Speaker 7: to we go v and similar to zepetite or zip bound,
Speaker 7: and the Amlin drug is a little bit early stay
Speaker 7: earlier stage. There are companies we are more advanced drugs
Speaker 7: in that world, but they all kind of feed into
Speaker 7: the same pathway, which is the pathway that talks between
Speaker 7: your food intake and your society centers in your brain
Speaker 7: and your insulin centers in your pancreas it tries to
Speaker 7: balance of eaten enough, let's stop eating now and let's
Speaker 7: release some insulin make it more sensitive so that we
Speaker 7: can deal with the onslaughter sugar that comes into our blood.
Speaker 7: That's where they are, is that's central to that space.
Speaker 7: There's cells in the gut that release glucle like JLP ones,
Speaker 7: grouking like peptize the cells in other parts of the
Speaker 7: body who are responding to it. So that's where these
Speaker 7: things sit, and amlin is just one of those agents
Speaker 7: in the middle of it.
Speaker 5: Say, I'm just kind of stepping back.
Speaker 2: Is GLP one drugs in general, there's a certain level
Speaker 2: of efficacy today, there's a certain level of say, side effects,
Speaker 2: whether it's large or something else today. Is there a
Speaker 2: room for improvement on both efficacy and side effects going
Speaker 2: forward with these drugs?
Speaker 7: Yeah, I mean with it's the balance that's the most important.
Speaker 7: With efficacy, I think we're pretty much there. I mean,
Speaker 7: you know, there are folks that we know that go
Speaker 7: on a drug for a week or two and they
Speaker 7: lose four or five kilograms. That's fine. You don't want
Speaker 7: to lose much faster than that, because I don't think
Speaker 7: it's particularly healthy if you lose weight at a much
Speaker 7: higher speed. And also you don't want to get much
Speaker 7: lighter than a aty kilo or ninety kilo or seventy five
Speaker 7: kilograms depending on your size. So the key is how
Speaker 7: do you get there. If you get there by having
Speaker 7: lots of side effects, then your probability of staying on
Speaker 7: the drug is lower, but we want you to stay
Speaker 7: on the drug. So it's a very very tight balance.
Speaker 7: And then of course you have to figure out what
Speaker 7: am I happy taking a weekly injection, which I think
Speaker 7: a lot of people are not. Don't have a problem
Speaker 7: with it, But what if Mitcera is right and push
Speaker 7: it to once monthly, if some of the other competitent
Speaker 7: is coming along with once every three months. Now, those
Speaker 7: are things that we have to wait and see how
Speaker 7: the data shows in terms of that balance of just
Speaker 7: referred to.
Speaker 2: Our thanks to Sam Fazeli, Bloomberg Intelligence, Director of Research
Speaker 2: for Global Industries and senior pharmaceuticals analysts. Staying in the
Speaker 2: pharmaceutical space. This week, the Trump administration linked thiland on
Speaker 2: to autism and urge pregnant women to avoid the common
Speaker 2: pain medication, and this comes despite the lack of widely
Speaker 2: accepted scientific evidence supporting the risk. For more co host
Speaker 2: Scarlett Field and I were joined by a Hunter Bloomberg
Speaker 2: Intelligence senior equity analysts for biopharmaceuticals. You first asked Ann
Speaker 2: about the science behind the latest news.
Speaker 8: There are a lot of studies on it. It's certainly
Speaker 8: driven by an increase in finding a solution for the
Speaker 8: increased rates of ADHD and autism. I think it's really
Speaker 8: important here to qualify or quantify what we're talking about
Speaker 8: with frequent Thailand all use, and most of the studies
Speaker 8: are looking at measured as more than twenty eight days
Speaker 8: over the course of your pregnant see, so that is
Speaker 8: a lot of tile and all use. We're not talking
Speaker 8: about you have a high fever and you take it
Speaker 8: for a day or two. This is this is kind
Speaker 8: of more long term use. There is a correlation between
Speaker 8: tile and all use and these disorders and children, and
Speaker 8: I'll probably lose listeners if I go too deeply. But
Speaker 8: correlation is not causation. Those are two separate things. And
Speaker 8: while there's a lot of literature out there, a lot
Speaker 8: of clinical studies, I would argue that the best ones
Speaker 8: look at sibling analysis, so they compare a mother who
Speaker 8: had frequent use during one pregnancy and not the next,
Speaker 8: and that's the best way to kind of look at this.
Speaker 8: And in those studies there was no findings of increased risks,
Speaker 8: and there have been several There was a two and
Speaker 8: a half million dollars a two and a half million
Speaker 8: children study in Sweden, as well as a more recent
Speaker 8: one out of Japan. Unfortunately, randomized trials are are difficult
Speaker 8: to do, there's just too many variables. But the sibling
Speaker 8: analysis is probably the best we have.
Speaker 3: So And when I think about the companies that are affected,
Speaker 3: certainly ken View, which owns the Talnyl brand. Tailanol's generic
Speaker 3: name is a seed of menaphin, and there are many
Speaker 3: other companies that make a seed of menaphin as well.
Speaker 3: Are we seeing them impacted in any way?
Speaker 7: You know?
Speaker 8: This is even for ken View, this is maybe a
Speaker 8: high single digit portion of sales, and that's thailenol overall,
Speaker 8: So you assume that the pregnant population is a much
Speaker 8: smaller percentage of those sales. And I'd argue even you know,
Speaker 8: before all of this, a lot of physicians, certainly mine
Speaker 8: when I was pregnant, recommended only taking tilenol when you
Speaker 8: have one of those you know, high fevers, So I
Speaker 8: wouldn't expect it to truly be a material impact to
Speaker 8: any of these companies.
Speaker 2: Is there anything else out there that is at risk here?
Speaker 2: I mean from just the FDA, I mean your coverage here,
Speaker 2: because I know there's a lot of uncertainty about which
Speaker 2: drugs are you know, kind of favored by this administration,
Speaker 2: which ones aren't. Is that Are you seeing that in
Speaker 2: your coverage of your companies?
Speaker 8: Well, for pregnancy in particular, I'd say, are there are
Speaker 8: no favorite drugs? You know, you certainly were never suggested
Speaker 8: to take aspirin and Tylenall was one of the few
Speaker 8: things that was considered okay. But overall, you know, anytime
Speaker 8: you get a lot of media attention on any drug
Speaker 8: from politics or anything else, it's typically not a great
Speaker 8: thing for the companies. But I think it does tend
Speaker 8: to even out as it passes.
Speaker 3: You are our senior equity analyst for biopharmaceuticals. When the
Speaker 3: Secretary of Health, Robert F. Kennedy Junior, speaks, does he
Speaker 3: tend to move companies in your universe?
Speaker 8: I would argue, yes, for better or for worse, I'd
Speaker 8: say they definitely move, but I would say that they
Speaker 8: go back to a steady state.
Speaker 7: Okay.
Speaker 3: So it's an immediate knee jerk reaction and then things
Speaker 3: calm down exactly.
Speaker 2: Our thanks to Ann Hunter, Bloomberg Intelligence Senior equity analyst
Speaker 2: for Biopharmaceuticals. We move next to some news in the
Speaker 2: luxury space. This week we heard that The Finished Company,
Speaker 2: or A Health, is raising eight hundred and seventy five
Speaker 2: million dollars in a new Series E financing round, and
Speaker 2: it's now closing in on a roughly eleven billion dollar valuation.
Speaker 2: That's after selling about three million rings over the past year.
Speaker 2: For more, co host Scarlett fil When I were joined
Speaker 2: by Mark German, Bloomberg News Managing editor for Global Consumer Tech,
Speaker 2: we first asked Mark for more background on the Aura
Speaker 2: ring maker.
Speaker 9: They want to scale production, they want to scale R
Speaker 9: and D, they want to move into new regions, they
Speaker 9: want to get into new retail stores, they want to
Speaker 9: add new software features, so they're looking to grow quickly.
Speaker 9: This nearly eleven billion dollar valuation. This is a pretty
Speaker 9: specific hardware company. They really make one thing, and if
Speaker 9: you look at their market cap now after that raise,
Speaker 9: you compare it to other companies that are known for
Speaker 9: really one type of hardware product. Peloton, Eye, Robot, Sonos
Speaker 9: bows Or is now worth more than all of them. Combined,
Speaker 9: which is pretty crazy to think about. So so far
Speaker 9: this looks to be a success store. It's not a
Speaker 9: very old company, but it's a company doing effective things
Speaker 9: and they're clearly building a product that people like. They've
Speaker 9: sold three million units in the last fourteen fifteen months
Speaker 9: or so. They've sold five and a half million rings
Speaker 9: to date. They're due to cross one billion in revenue
Speaker 9: in twenty five, a billion and a half in twenty six.
Speaker 9: They did five hundred million in twenty four, so they
Speaker 9: seem to be growing quite nicely.
Speaker 2: I don't know, not being into the ring fit ring
Speaker 2: business myself. Fit ring, I like that fit ring. I mean,
Speaker 2: this seems like something that your friends at Cooper Tina
Speaker 2: could come out with tomorrow and copycat. How do you
Speaker 2: think that's the competitive landscape?
Speaker 9: Yeah, the competitive landscape is interesting. There's a few smaller
Speaker 9: players that are also doing smart rings. Samsung rolled out
Speaker 9: what they call the Galaxy Ring last year, and for Samsung,
Speaker 9: who's actually been a dud, the functionality is just not
Speaker 9: on par with Aura. What Aura has is a very
Speaker 9: strong brand, They have very strong functionality, and they have
Speaker 9: that big first mover advantage. But you're right, if Apple
Speaker 9: comes out with a ring, They're gonna eat Aura's lunch.
Speaker 7: You know.
Speaker 9: Aura's perspective is that they have this gigantic and tried
Speaker 9: and true in legal proceedings patent portfolio, and so they
Speaker 9: feel that if Apple were to come out with a ring,
Speaker 9: or another company were to really hit the nail on
Speaker 9: the head with the ring, that they would be able
Speaker 9: to defend their patents. And they've shown to be able
Speaker 9: to do that. They have some cases in front of
Speaker 9: the International Trade Commission and other organizations right now for
Speaker 9: some of the other competitors, So we'll see what happens.
Speaker 9: I don't anticipate Apple coming out with a ring anytime soon.
Speaker 9: I will say that this ten billion dollar valuation is
Speaker 9: a little bit of a double edged sword. On one hand,
Speaker 9: that's amazing for the company. On the other hand, it
Speaker 9: puts them in territory where they're probably not going to
Speaker 9: be acquired or bought in, which would spur another company
Speaker 9: like Apple if they wanted a ring, develop one versus
Speaker 9: buy them. And definitely they're gonna have to make a
Speaker 9: decision in the next couple of years whether they're going
Speaker 9: to go public via an IPO spat or if they're
Speaker 9: going to stay private all right.
Speaker 2: Thanks to Mark German, Bloomberg News Managing editor for Global
Speaker 2: Consumer Tech, coming up a look into the current succession
Speaker 2: plan at T Mobile. You're listening to Bloomberg Intelligence on
Speaker 2: Bloomberg Radio, providing in depth research and data on two
Speaker 2: thousand companies and one hundred and thirty industries. You can
Speaker 2: access Bloomberg Intelligence via Big on the terminal. I'm Paul Sweeney,
Speaker 2: and this is Bloomberg.
Speaker 1: This is Bloomberg Intelligence with Scarlett Fou and Paul Sweeney
Speaker 1: on Bloomberg Radio.
Speaker 2: We next moved to some news in a telecommunications space.
Speaker 2: This week, we heard that T Mobile is promoting Chief
Speaker 2: operating Officer Shriney Gopalon to the top job. He replaced
Speaker 2: CEO Mike Sievert, who will become vice chairman. And this
Speaker 2: comes as T Mobile competes for customers market that now
Speaker 2: also spans home internet and satellite service.
Speaker 10: For more.
Speaker 2: Co host Scarlett Field and I were joined by John Butler,
Speaker 2: Bloomberg Intelligence senior telecom analyst. We first asked John if
Speaker 2: he's surprised with T mobiles changeover.
Speaker 10: Not at all. This was incredibly well broadcast. Shriney has
Speaker 10: been hitting the conference circuit. So at this time of year,
Speaker 10: all the major investment banks hold these conferences, and he's
Speaker 10: been in almost everyone sort of out there telling the
Speaker 10: T Mobiles story. And in my mind it answers one
Speaker 10: of two questions. Right with any incoming CEO, You're like,
Speaker 10: can they manage the company effectively? And can they manage
Speaker 10: the stock effectively? Can they get that narrative out spin
Speaker 10: a good story? And he is really good at that.
Speaker 10: So he's answered the second question, and I think in
Speaker 10: some ways he's answered the first as well.
Speaker 2: Talk to us about the wireless business these days, it's
Speaker 2: just a brutally competitive business. Just give us the lay
Speaker 2: of the land there between AT and T, Verizon, T Mobile,
Speaker 2: and I don't know anybody else who might be out.
Speaker 10: I mean, the big three are still dominant. Paul and
Speaker 10: T Mobile has executed beautifully over the past few years.
Speaker 10: You know, they've done a very good job of sort
Speaker 10: of securing the lead in terms of subscriber growth by
Speaker 10: you know, marketing on this hip counterculture brand image. They
Speaker 10: continue to be, I think, having an outsized impact on consumers.
Speaker 10: When you think a wireless it really is a consumer
Speaker 10: retail business. They all have thousands of stores. They advertise
Speaker 10: on the Super Bowl, they have giveaways, and I think
Speaker 10: T Mobile, more than most, really does that well. And
Speaker 10: I think the Big Three, because of their scale set,
Speaker 10: it sort of sets this sort of wide mote for
Speaker 10: any newcomers that want to come in. So T Mobile
Speaker 10: as number two in the industry, I think is going
Speaker 10: to remain firmly in that place, if not move into
Speaker 10: the number one position over the next several years.
Speaker 3: Number one Verizon.
Speaker 10: Number one is Verizon still, so I'm a Verizon person.
Speaker 3: I am too, But I just went to Italy and
Speaker 3: how did it? What did you do for your phone needs?
Speaker 2: Fine, it's just a lot. I have a plan that
Speaker 2: just ports over to an international.
Speaker 3: Okay, because I do uh huh all of my offspring.
Speaker 2: That's the only thing that I still pay for the Yes, no.
Speaker 3: One wants to give that up. Why pay for your
Speaker 3: own cell phone service when dad will pay for it.
Speaker 3: I switched over to T Mobile because of the giveaways, Yes,
Speaker 3: because of the free iPhone last cycle, and also because
Speaker 3: you get free data and free international texting when you're
Speaker 3: overseas up to five gigabytes, so that means I never
Speaker 3: have to buy an international data parison shopping.
Speaker 10: That is the single biggest hook I hear. So when
Speaker 10: people come to me and they're like, I'm a T
Speaker 10: mobile subscriber, they have all these giveaways and they have
Speaker 10: international goal.
Speaker 3: That makes a big difference because when I was on
Speaker 3: AT and T, I was paying ten dollars a day
Speaker 3: and that adds.
Speaker 10: Up really quickly, does it really?
Speaker 4: You know?
Speaker 3: And then only one person the family can get it
Speaker 3: because you know, not everyone's going to get.
Speaker 2: It right and yeah, four offspring plus an next wife
Speaker 2: you're still thinking for Well, there you go. Charlie Pellett
Speaker 2: is on the T Mobi. He always tries to sell.
Speaker 3: Me to get Charlie also knows the great deal. That's
Speaker 3: the secret here a Bloomberg Charlie was.
Speaker 2: Tracking the strange parts of the world where he probably
Speaker 2: needs that kind of stuff. So what's the future of
Speaker 2: wireless in this country? Is it just our poop growth?
Speaker 2: Average revenue per user? And is that kind of the
Speaker 2: story for.
Speaker 10: That is So that is a great question, that is
Speaker 10: what's driving growth? Now for a telco, you start of
Speaker 10: run out of room for adding new subs and so
Speaker 10: you need to drive that up that average revenue per
Speaker 10: user and they're doing it with the giveaways we were
Speaker 10: just talking about. They actually charge modestly for those. In
Speaker 10: some cases they're selling you phone insurance. T Mobile is
Speaker 10: now pushing into the advertising business, but the real avenue
Speaker 10: of growth to watch for them going forward is broadband.
Speaker 10: They are making more and more inroads into the market
Speaker 10: and T Mobile it's what I'm watching with the new
Speaker 10: CEO here to see what he does in fiber broadband,
Speaker 10: because if T Mobile has had any sort of a
Speaker 10: misfire over the past decade, it's not getting into fiber
Speaker 10: broadband in a bigger way in the way that AT
Speaker 10: and TM Verizon both have through sizeable and aggressive acquisitions.
Speaker 10: So it'll be interesting to see what he does there.
Speaker 10: My call is he's going to start building quickly and aggressively,
Speaker 10: would be my guess.
Speaker 2: A R thanks to John Butler, Bloomberg Intelligence Senior Telecom analyst.
Speaker 2: We move next to the media entertainment space. This week,
Speaker 2: Late night host Jimmy Kimmel returned to television. ABC parent
Speaker 2: Walt Disney had pulled the show off the air. That's
Speaker 2: after Kimmel said conservatives were trying to score political points
Speaker 2: off the fatal shooting of conservative activists Charlie Kirk. In
Speaker 2: his return, Kimmel didn't shy away from poking fun at
Speaker 2: President Donald Trump and FCC Chairman Brendan Carr and making
Speaker 2: an impassioned case for free speech for more and all
Speaker 2: this scarlet field. When I were joined by Githa Ranganath
Speaker 2: and Bloomberg Intelligence senior media analyst, we first asked Githa
Speaker 2: what this news means for late night networks and whether
Speaker 2: they still make money.
Speaker 6: They don't make a whole lot of money, Paul, not anymore.
Speaker 6: It used to be that, you know, late night television
Speaker 6: would bring in a lot of ratings, would bring in
Speaker 6: a lot of AD dollars. That has really changed. We've
Speaker 6: we've seen linear TV kind of hemorrhage viewers now over
Speaker 6: so many years, and late night has no exception. So
Speaker 6: if you just kind of look at, you know, Jimmy
Speaker 6: Kimmel's show, for instance, it generates roughly about fifty million
Speaker 6: dollars in AD revenue. Compare that to a few years
Speaker 6: ago when it used to generate close to about one
Speaker 6: hundred and fifty million. So definitely AD revenue going down,
Speaker 6: and most of these late night shows are losing money.
Speaker 6: Just given the programming budget for these shows. So not
Speaker 6: really a needle mover in a financial sense for Disney.
Speaker 3: Okay, But in a cultural sense, it is because these
Speaker 3: are shows that define the networks, and so thank you
Speaker 3: for putting numbers to that, because I think there's a
Speaker 3: lot of concern or skepticism from certain corners of American
Speaker 3: communities that question whether Stephen Colbert's show should have been
Speaker 3: canceled for financial reasons, as CBS asserts it was. Keita,
Speaker 3: Is ABC going to pay some kind of price for
Speaker 3: allowing Kimmel to go back on air because the President,
Speaker 3: for instance, alluded to making more money off the company
Speaker 3: for doing so.
Speaker 6: Yeah, it's certainly possible. I mean, we've seen President Trump
Speaker 6: kind of go after you know, the broadcast networks threatened
Speaker 6: to kind of revoke licenses, so he goes after anybody.
Speaker 6: He uses his power, you know, the courts, to attack
Speaker 6: anybody who says anything unflattering about him. But that's, you know,
Speaker 6: definitely possible from a Disney perspective. Though you have to
Speaker 6: remember this is a very very diversified company, So yes,
Speaker 6: ABC is definitely a very important asset. But again, if
Speaker 6: you put some numbers around this, scarlet. It makes up
Speaker 6: only about they generate of Disney itself generates about nine
Speaker 6: to one hundred billion dollars in revenue every year. ABC
Speaker 6: is about five billion, five to six billion in revenue,
Speaker 6: so it's just about five percent for the company. So again,
Speaker 6: you know, small potatoes in the context of the company's financials.
Speaker 6: But yes, you bring up a very important point about
Speaker 6: culture wars. Unfortunately, I think Disney is in a losing
Speaker 6: position whichever way, because they're either going to anger you know,
Speaker 6: the conservatives or the other end of the spectrum.
Speaker 4: So it's just tough.
Speaker 3: Yeah, very quickly get that. In the days following kimmel suspension,
Speaker 3: a number of people canceled or threatened to cancel their
Speaker 3: Disney plus streaming services. Do we have a sense that
Speaker 3: this might get kind of noisy when it comes to
Speaker 3: the earning supports and the streaming numbers and subscriptions.
Speaker 6: I mean, we've seen this kind of backlash before happen,
Speaker 6: you know, in the case of certain programming and you
Speaker 6: know with Netflix, with other streaming services. Typically we haven't
Speaker 6: really seen it reflected in the numbers, even though there's
Speaker 6: a lot of noise around it. So yes, maybe a
Speaker 6: little bit of up and down, but I don't think
Speaker 6: it'll have again any big needle moving effect on the
Speaker 6: Disney Plus subscriber numbers.
Speaker 3: Ah.
Speaker 2: Iight, Keith, Well we got you here. I have to
Speaker 2: ask do we have any news on succession to Bob Iger?
Speaker 6: Hmmm, not yet, Not yet, Paul, I mean, that's the
Speaker 6: biggest question always for Disney. He is supposed to retire
Speaker 6: by the end of twenty twenty six. There is a
Speaker 6: lot of rumblings that it might be somebody internal, you know,
Speaker 6: we keep hearing about Dana Walden. Of course, nothing certain
Speaker 6: just yet.
Speaker 2: Our thanks to KEITHA. Rung Anathan Bloomberg Intelligence Senior Media Analyst.
Speaker 2: We move next to some news in the food and
Speaker 2: beverage industry. The coffee giant Strawbucks announced it will close
Speaker 2: stores and eliminate nine hundred jobs in a one billion
Speaker 2: dollar restructuring effort under new chief executive officer Brian nicchol.
Speaker 2: For more, co host Scarlett Ffuh and I were joined
Speaker 2: by Michael Halen, Bloomberg Intelligence Senior Restaurant and food service analyst.
Speaker 2: We first asked Michael for his take on this week's news.
Speaker 11: This was very clearly communicated to the street. Back in
Speaker 11: April on their fiscal call, Management said that you know,
Speaker 11: we expect more restructuring charges. Is we're going to continue
Speaker 11: to evaluate our store base. Really, management wanted new CFO
Speaker 11: Kathy Smith to be involved in the process, so this
Speaker 11: was not a surprise, all right.
Speaker 2: A shout out to my Starbucks on Route thirty five
Speaker 2: and Wall Township, New Jersey. They do a great job,
Speaker 2: great folks, very efficient, very good Mike. What does this
Speaker 2: company need to do? What do they say is under
Speaker 2: to do list to turn this company around? What are
Speaker 2: you looking for?
Speaker 11: Yeah, it's more operations in marketing and we're starting to
Speaker 11: see things kind of inflect here. We think fiscal twenty
Speaker 11: six should be a nice bounce back year. So you know,
Speaker 11: first it's with the operations, right, so it's eliminating menu items,
Speaker 11: increasing labor, which baristas. We're very happy about, creating a
Speaker 11: smart queue for mobile orders, right, so the stores aren't
Speaker 11: as chaotic and baristas aren't serving you know, mobile orders
Speaker 11: for somebody thirty miles away before it help someone inside
Speaker 11: the store. And then service standards, right, they're rolling out
Speaker 11: these green Apron service standards this year. It's a big
Speaker 11: investment on training and really nailing the consumer experience in
Speaker 11: the store. And then from there it's the marketing and
Speaker 11: marketing seems to be working. They pulled back on discounts
Speaker 11: and what they're doing is more marketing. You'll see some
Speaker 11: TV ads right. They're doing more digital marketing, and we
Speaker 11: think that's a smart move. It seems to be paying
Speaker 11: early dividends. Starbucks non rewards member transactions are up. Non
Speaker 11: discounted rewards members transactions are up, and we think these
Speaker 11: are a sign that sales are going to inflect higher
Speaker 11: in the coming months.
Speaker 3: Okay, but this is taking a while. Paul and I
Speaker 3: were just saying that Brian Nickel owns this now he's
Speaker 3: been CEO for a year and they're still in turnaround mode.
Speaker 3: They're still in kind of like let's figure out our
Speaker 3: path forward. Investors, please be patient. Are investor is going
Speaker 3: to continue to be patient for another six months to
Speaker 3: one year?
Speaker 11: I don't think they're going to be patient for six
Speaker 11: months to one year. In terms of the stock price,
Speaker 11: I think Brian Nichols job is very much safe. You know,
Speaker 11: you can't turn around an aircreraft carrier on a dime, right,
Speaker 11: This is a massive organization eighteen thousand stores just here
Speaker 11: in North America over forty thousand globally. So yes, this
Speaker 11: is taking longer than a lot anticipated you know, myself included.
Speaker 11: You know, our investor is going to be happy if
Speaker 11: they don't see same sore sales inflect here in the
Speaker 11: first quarter of fiscal twenty six. No, they're not going
Speaker 11: to be happy, and you're going to see it reflected
Speaker 11: in the share price.
Speaker 6: Right.
Speaker 11: So yeah, I mean I think they're they're making the
Speaker 11: right moves. This has been a longer turnaround than most
Speaker 11: had expected. But you know, I think Brian Nichols pressing
Speaker 11: all the right buttons right now.
Speaker 2: Our thanks to Michael Halen, Bloomberg Intelligence senior restaurant and
Speaker 2: food service analyst. That's this week's edition of Bloomberg Intelligence
Speaker 2: on Bloomberg Radio, providing in depth research and data on
Speaker 2: two thousand companies and one hundred and thirty industries. And
Speaker 2: remember you can that is Bloomberg Intelligence via b I
Speaker 2: go on the terminal, I'm Paul Sweeney. Stay with us.
Speaker 2: Today's top stories and global business headlines are coming up
Speaker 2: right now.
Speaker 7: M