1
00:00:02,720 --> 00:00:10,560
Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the

2
00:00:10,560 --> 00:00:14,480
Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am

3
00:00:14,560 --> 00:00:18,479
Speaker 1: Eastern on Applecarplay and Android Auto with the Bloomberg Business App.

4
00:00:18,600 --> 00:00:21,840
Speaker 1: Listen on demand wherever you get your podcasts, or watch

5
00:00:21,920 --> 00:00:23,040
Speaker 1: us live on YouTube.

6
00:00:23,960 --> 00:00:27,000
Speaker 2: Little m and a activity here in the tech sector,

7
00:00:27,080 --> 00:00:30,840
Speaker 2: Intel finalizes a deal to sell fifty one percent of

8
00:00:30,920 --> 00:00:34,320
Speaker 2: It's All terrorI stake to silver Lake. Now silver Lake folks,

9
00:00:34,360 --> 00:00:36,319
Speaker 2: I got to know them back in the day. I

10
00:00:36,360 --> 00:00:39,159
Speaker 2: think one of the smarter private equity folks that has

11
00:00:39,200 --> 00:00:40,479
Speaker 2: a technology bent.

12
00:00:40,600 --> 00:00:42,640
Speaker 3: Some super super smart folks.

13
00:00:42,640 --> 00:00:45,000
Speaker 2: They've backed a lot of companies over the last thirty

14
00:00:45,080 --> 00:00:47,360
Speaker 2: years in Silicon Valley. They know what they're doing and

15
00:00:47,400 --> 00:00:49,599
Speaker 2: when they move their money, you pay attention. Man Deep Sing,

16
00:00:49,920 --> 00:00:52,080
Speaker 2: I also pay attention to him. He's a senior tech analyst.

17
00:00:52,080 --> 00:00:55,000
Speaker 2: The Bloomberg Intelligence Joints is here in our Bloomberg Interactive

18
00:00:55,000 --> 00:00:58,000
Speaker 2: Broker studio. What's in Intel up to these days?

19
00:00:58,040 --> 00:01:01,160
Speaker 4: In Deep Well, they got our news CEO, and I

20
00:01:01,200 --> 00:01:05,039
Speaker 4: think he's making the moves. Everyone was looking forward to

21
00:01:05,200 --> 00:01:08,440
Speaker 4: what is he going to do differently than Pat Gelsinger,

22
00:01:08,600 --> 00:01:12,560
Speaker 4: And it looks like he wants to turn around the

23
00:01:12,600 --> 00:01:16,480
Speaker 4: foundry business. There was one school of thought that thought

24
00:01:16,480 --> 00:01:20,480
Speaker 4: Intel should sell the foundry and focus on chip design

25
00:01:20,680 --> 00:01:25,360
Speaker 4: like Nvidia. But clearly he feels, you know, foundry business

26
00:01:25,520 --> 00:01:29,520
Speaker 4: can be turned around. And so the easy pickings here

27
00:01:29,720 --> 00:01:32,680
Speaker 4: is raise cash, you know, get rid of the non

28
00:01:32,760 --> 00:01:34,000
Speaker 4: core assets.

29
00:01:33,560 --> 00:01:35,039
Speaker 5: Which is all Terra here.

30
00:01:35,120 --> 00:01:38,840
Speaker 4: So they're selling fifty one percent stake, mobilize another business

31
00:01:38,840 --> 00:01:41,720
Speaker 4: that comes to mind that they could sell. And look,

32
00:01:41,760 --> 00:01:45,400
Speaker 4: with a company like Intel, everyone knows that, you know,

33
00:01:45,480 --> 00:01:49,640
Speaker 4: you can't really turn around this company to show high growth.

34
00:01:49,880 --> 00:01:52,800
Speaker 4: It's more about how do you manage the company in

35
00:01:52,840 --> 00:01:55,520
Speaker 4: a way where they're not burning a lot of cash

36
00:01:55,640 --> 00:01:57,920
Speaker 4: as well as they can have you know, low to

37
00:01:58,040 --> 00:02:00,320
Speaker 4: mid single digit growth. And I think that's to be

38
00:02:00,320 --> 00:02:01,080
Speaker 4: the playbook here.

39
00:02:01,480 --> 00:02:03,960
Speaker 6: So, man, deep, is silver Lake getting a good deal

40
00:02:04,000 --> 00:02:05,040
Speaker 6: then with this epic?

41
00:02:05,440 --> 00:02:08,720
Speaker 4: I mean Intel paid you know, sixteen billion plus ten

42
00:02:08,800 --> 00:02:11,560
Speaker 4: years back, so they held the company for ten years

43
00:02:11,880 --> 00:02:15,080
Speaker 4: and now they're selling it half the price. And look,

44
00:02:15,160 --> 00:02:17,520
Speaker 4: this isn't a high growth asset, which is why it

45
00:02:17,639 --> 00:02:22,120
Speaker 4: was noncore to Intel. But we know Semis isn't that

46
00:02:22,200 --> 00:02:25,160
Speaker 4: sweet part of the cycle where everyone seems to be

47
00:02:25,200 --> 00:02:29,800
Speaker 4: bullish on AI and Semis, and so maybe silver Lake

48
00:02:29,880 --> 00:02:32,240
Speaker 4: can come up with a better way to you know,

49
00:02:32,400 --> 00:02:35,320
Speaker 4: leverage all Terra in that semi space, because that's what

50
00:02:35,400 --> 00:02:38,160
Speaker 4: everyone seems to be excited by. How can I play

51
00:02:38,240 --> 00:02:40,000
Speaker 4: in the demand for Semis?

52
00:02:40,160 --> 00:02:41,320
Speaker 3: Why did they solve a whole thing?

53
00:02:42,800 --> 00:02:46,520
Speaker 4: Well, I mean it's a private equity player, so you know,

54
00:02:46,680 --> 00:02:49,280
Speaker 4: they're not going to put a lot of money in

55
00:02:49,360 --> 00:02:52,440
Speaker 4: one asset, and they just wanted fifty one percent so

56
00:02:52,480 --> 00:02:55,240
Speaker 4: that they can run the company. At the same time,

57
00:02:55,480 --> 00:02:58,519
Speaker 4: Intel can benefit if they are able to successfully turn

58
00:02:58,600 --> 00:03:03,880
Speaker 4: it around. And yeah, I think Alterra still needs Intel

59
00:03:04,000 --> 00:03:06,919
Speaker 4: technology to be successful. So it's not as if there's

60
00:03:06,960 --> 00:03:10,440
Speaker 4: a complete decoupling. It just allows Intel to focus more

61
00:03:10,480 --> 00:03:13,840
Speaker 4: on the core business, the foundry and their CPU business,

62
00:03:13,840 --> 00:03:16,480
Speaker 4: as opposed to focusing on Alterra and mobile IE. I

63
00:03:16,520 --> 00:03:18,080
Speaker 4: think down the line.

64
00:03:17,800 --> 00:03:20,920
Speaker 6: Should we expect with this new Intel CEO to see

65
00:03:21,320 --> 00:03:24,960
Speaker 6: more news like this Intel selling other parts of its business.

66
00:03:25,480 --> 00:03:28,400
Speaker 4: I think so mobile ie is definitely another one which

67
00:03:28,440 --> 00:03:31,800
Speaker 4: is non core to Intel, even if they want to

68
00:03:31,840 --> 00:03:35,560
Speaker 4: double down on AI and chip design. Within AI, I

69
00:03:35,560 --> 00:03:39,440
Speaker 4: mean mobile IE is more autonomous driving and that also

70
00:03:39,480 --> 00:03:43,000
Speaker 4: came from another acquisition that Intel did back in the day.

71
00:03:43,560 --> 00:03:46,280
Speaker 4: So I hope they don't end up taking a loss

72
00:03:46,320 --> 00:03:50,839
Speaker 4: on that one. But I do think the playbook here

73
00:03:50,920 --> 00:03:54,040
Speaker 4: seems to be that they want to focus on foundry

74
00:03:54,080 --> 00:03:56,600
Speaker 4: and core CPU chip design.

75
00:03:57,040 --> 00:03:59,760
Speaker 3: Foundry that's making chips, right.

76
00:03:59,720 --> 00:04:03,800
Speaker 4: Yeah, the manufacturing side, Now, who else does that? Well,

77
00:04:03,840 --> 00:04:06,320
Speaker 4: we just heard the news around in Vidia, you know,

78
00:04:06,960 --> 00:04:11,960
Speaker 4: using TSMC to make their AI supercomputers here in the US.

79
00:04:12,280 --> 00:04:14,600
Speaker 4: So that's that was quite a bit of news because

80
00:04:14,760 --> 00:04:18,240
Speaker 4: I would have thought TSMC would partner with Intel, and

81
00:04:18,279 --> 00:04:21,800
Speaker 4: there was some rumblings about, you know, TSMC doing something

82
00:04:21,839 --> 00:04:24,680
Speaker 4: with Intel at least here in the US. But it

83
00:04:24,720 --> 00:04:28,720
Speaker 4: looks like Nvidia is thinking about making their next CI

84
00:04:28,880 --> 00:04:33,200
Speaker 4: supercomputer with TSMC. No talk about Intel, and that will

85
00:04:33,240 --> 00:04:34,080
Speaker 4: be here in the US.

86
00:04:34,080 --> 00:04:35,040
Speaker 3: So then invested.

87
00:04:35,200 --> 00:04:37,320
Speaker 2: I thought there's some deal that there were Intel's gonna

88
00:04:37,400 --> 00:04:38,800
Speaker 2: do a bunch of that stuff.

89
00:04:38,839 --> 00:04:41,680
Speaker 4: Yeah, so that's where there was talk about Intel and

90
00:04:41,760 --> 00:04:44,880
Speaker 4: TSMC partnering. So that was the foundry side of Intel.

91
00:04:44,960 --> 00:04:47,440
Speaker 4: But I don't think that's happening now.

92
00:04:47,520 --> 00:04:50,599
Speaker 2: So the Biden plan with Intel, which was to do

93
00:04:50,680 --> 00:04:54,000
Speaker 2: a big, big deal, big investment, is that's still on

94
00:04:54,160 --> 00:04:54,359
Speaker 2: or no.

95
00:04:54,880 --> 00:04:58,039
Speaker 4: So the chips Act money was given to Intel. It

96
00:04:58,160 --> 00:05:01,000
Speaker 4: was also given to TSMC for or the Phoenix fab

97
00:05:01,080 --> 00:05:07,719
Speaker 4: there they will be making this AI supercomputer with you know, Nvidia.

98
00:05:08,120 --> 00:05:11,039
Speaker 4: But look, I think in the case of Intel, the

99
00:05:11,160 --> 00:05:15,440
Speaker 4: challenge has always been why have they not participated in

100
00:05:15,480 --> 00:05:19,040
Speaker 4: this AI wave? And the Chipsack money didn't help over there,

101
00:05:19,480 --> 00:05:20,080
Speaker 4: all right.

102
00:05:20,160 --> 00:05:22,200
Speaker 2: Man Deep Singh, thank you so much. We appreciate it.

103
00:05:22,240 --> 00:05:24,440
Speaker 2: Man Deep Singh. He's a senior tech analyst. He kind

104
00:05:24,440 --> 00:05:29,440
Speaker 2: of runs our global technology research franchise over Bloomberg Intelligence,

105
00:05:30,240 --> 00:05:30,640
Speaker 2: and he.

106
00:05:30,640 --> 00:05:32,719
Speaker 3: And Ana Agrana are the thought leaders there and they

107
00:05:32,800 --> 00:05:33,000
Speaker 3: kind of.

108
00:05:33,040 --> 00:05:36,800
Speaker 2: Drive the process forward. Here Intel selling fifty one percent

109
00:05:36,880 --> 00:05:39,919
Speaker 2: of one of their businesses to Silver like but a

110
00:05:40,160 --> 00:05:43,039
Speaker 2: steep valuation discount that had the hurt.

111
00:05:44,680 --> 00:05:48,360
Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live

112
00:05:48,480 --> 00:05:51,560
Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android

113
00:05:51,560 --> 00:05:54,880
Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever

114
00:05:54,920 --> 00:05:58,040
Speaker 1: you get your podcasts, or watch us live on YouTube.

115
00:05:58,760 --> 00:06:01,080
Speaker 3: And Mike Grafey was sitting in for Steal here today.

116
00:06:01,120 --> 00:06:01,640
Speaker 3: I'm Paul Swen.

117
00:06:01,680 --> 00:06:03,640
Speaker 2: You were live on our Bloomberg Interactive Broker Studio or

118
00:06:03,720 --> 00:06:05,880
Speaker 2: streaming live on YouTube as well, so you can check

119
00:06:05,920 --> 00:06:08,800
Speaker 2: us out on YouTube. Golden Sachs put out, there are

120
00:06:08,839 --> 00:06:11,880
Speaker 2: results this morning, better than expected results that stocks up

121
00:06:11,880 --> 00:06:14,040
Speaker 2: about two and a half percent. Was really the equity

122
00:06:14,360 --> 00:06:16,840
Speaker 2: trading desk powering the way here, similar to what we

123
00:06:16,880 --> 00:06:19,920
Speaker 2: saw from JP Morgan, Morgan Stanley last week's Let's get

124
00:06:19,920 --> 00:06:22,279
Speaker 2: the breakdown here with Alison Williams, senior analyst covering all

125
00:06:22,279 --> 00:06:26,000
Speaker 2: the financial institutions for a Bloomberg intelligency joins us life

126
00:06:26,000 --> 00:06:28,599
Speaker 2: here in our Bloomberg Interactive Broker Studio Goldman Sachs.

127
00:06:28,680 --> 00:06:30,239
Speaker 3: The stock traders had a nice quarter.

128
00:06:30,839 --> 00:06:33,760
Speaker 5: They did have a nice quarter, and you.

129
00:06:33,720 --> 00:06:36,400
Speaker 7: Know they didn't They weren't up forty five to fifty

130
00:06:36,440 --> 00:06:39,760
Speaker 7: percent like JP Morgan and Morgan Stanley, but still enough

131
00:06:39,800 --> 00:06:44,039
Speaker 7: to hold that number one lead across and what we're

132
00:06:44,040 --> 00:06:47,760
Speaker 7: hearing is derivatives, which is not surprising, right given all

133
00:06:47,800 --> 00:06:51,280
Speaker 7: the volatility. And the other interesting note is, you know,

134
00:06:51,640 --> 00:06:55,440
Speaker 7: Goldman this quarter a little bit weaker than the peers,

135
00:06:55,480 --> 00:06:57,960
Speaker 7: but over the long term, I mean the market share

136
00:06:58,000 --> 00:07:02,320
Speaker 7: games they've had in fic N equities trade really strong,

137
00:07:02,680 --> 00:07:06,560
Speaker 7: leading across all of the banks over the ten years.

138
00:07:07,000 --> 00:07:09,880
Speaker 7: Those three names, JP Morgan Morgan standing Goldman all gaining,

139
00:07:09,920 --> 00:07:12,640
Speaker 7: But really Goldman has done a good job. They've been

140
00:07:12,640 --> 00:07:15,960
Speaker 7: focusing on clients. They've also been focusing on financing revenue.

141
00:07:16,320 --> 00:07:19,320
Speaker 7: Fick trading also above a year ago, just not as

142
00:07:19,360 --> 00:07:21,800
Speaker 7: strong and a little bit shy. And then the other

143
00:07:21,840 --> 00:07:24,760
Speaker 7: part of the story, as you know, is those weaker fees.

144
00:07:24,840 --> 00:07:27,880
Speaker 7: So Goldman is number one and equity trading revenue, they're

145
00:07:27,920 --> 00:07:31,360
Speaker 7: number one in M and A, equity trading really powering

146
00:07:31,400 --> 00:07:34,800
Speaker 7: these banks higher. M and A really feeling the fallout

147
00:07:34,840 --> 00:07:35,720
Speaker 7: from uncertainty.

148
00:07:36,000 --> 00:07:36,440
Speaker 5: That's right.

149
00:07:36,480 --> 00:07:40,600
Speaker 6: So the company's investment banking revenue was eight percent lower

150
00:07:40,640 --> 00:07:44,560
Speaker 6: than last year. Is that just due to macro uncertainty,

151
00:07:44,680 --> 00:07:47,400
Speaker 6: companies not wanting to get deals done because they're not

152
00:07:47,400 --> 00:07:48,760
Speaker 6: sure what's going to happen in the future.

153
00:07:49,320 --> 00:07:51,880
Speaker 5: It's exactly that. So debt fees.

154
00:07:51,600 --> 00:07:54,239
Speaker 7: Really have been the area of strength across these banks

155
00:07:55,000 --> 00:07:58,880
Speaker 7: continued to be the area of strength this quarter. Equity fees,

156
00:07:58,920 --> 00:08:01,600
Speaker 7: which started out the year strong. As you can imagine,

157
00:08:01,640 --> 00:08:05,520
Speaker 7: there was some stalling as markets sold off, like especially

158
00:08:05,520 --> 00:08:10,000
Speaker 7: in the US late in the first quarter, but now

159
00:08:10,040 --> 00:08:12,200
Speaker 7: really a lot of those deals coming to a standstill.

160
00:08:12,240 --> 00:08:14,280
Speaker 7: On the equity side of things, and then M and A,

161
00:08:14,440 --> 00:08:16,400
Speaker 7: which really can be deriven by.

162
00:08:17,880 --> 00:08:19,040
Speaker 5: CEO sentiment.

163
00:08:19,200 --> 00:08:20,440
Speaker 7: Keep in mind, and you know, if you're going to

164
00:08:20,520 --> 00:08:23,360
Speaker 7: sell your business, you want to be sure that you're

165
00:08:23,480 --> 00:08:27,040
Speaker 7: getting the best value for your shareholders. Similarly, if you're

166
00:08:27,080 --> 00:08:30,960
Speaker 7: buying a business, you want to be estimating what your

167
00:08:30,960 --> 00:08:33,600
Speaker 7: return on investment is going to be, and you really can't.

168
00:08:33,800 --> 00:08:35,199
Speaker 5: There's so much uncertainty.

169
00:08:35,280 --> 00:08:37,920
Speaker 7: There's so much I think, so much of a wait

170
00:08:37,960 --> 00:08:41,360
Speaker 7: and see approach that that business has really come to

171
00:08:41,400 --> 00:08:42,040
Speaker 7: a standstill.

172
00:08:42,440 --> 00:08:46,199
Speaker 2: I see that David Solomon, the CEO, called out growing backlog.

173
00:08:46,840 --> 00:08:51,280
Speaker 2: Backlog ain't cash, Backlog's not fees. What's the saying about

174
00:08:51,280 --> 00:08:53,800
Speaker 2: the environment that gets stuff done, whether it's an M

175
00:08:53,880 --> 00:08:56,200
Speaker 2: and A trade and IPO, that kind of stuff.

176
00:08:56,920 --> 00:08:59,000
Speaker 7: And that's a great point because we always do look

177
00:08:59,000 --> 00:09:02,040
Speaker 7: at the pipeline and as you said, Samon did point out, look,

178
00:09:02,040 --> 00:09:04,160
Speaker 7: we've seen it grow another quarter in a row. But

179
00:09:04,559 --> 00:09:07,160
Speaker 7: you want that pipeline growing because there's more new business

180
00:09:07,240 --> 00:09:10,480
Speaker 7: not coming in, not because things are not getting done right.

181
00:09:10,520 --> 00:09:11,600
Speaker 5: So the pipeline can.

182
00:09:11,920 --> 00:09:14,679
Speaker 7: Increase for two reasons, and you really want to What

183
00:09:14,720 --> 00:09:17,760
Speaker 7: you really want is execution and confidence in the execution.

184
00:09:18,520 --> 00:09:21,640
Speaker 7: So the positive sign, which I think is true for

185
00:09:21,720 --> 00:09:25,679
Speaker 7: so many things, right, is that we have a huge

186
00:09:25,760 --> 00:09:30,160
Speaker 7: level of uncertainty. If that resolves, then you could be

187
00:09:30,200 --> 00:09:33,160
Speaker 7: back in business, and unlike some of the other periods

188
00:09:33,160 --> 00:09:35,520
Speaker 7: that we've seen with incredible uncertainty.

189
00:09:35,600 --> 00:09:35,760
Speaker 6: Right.

190
00:09:35,800 --> 00:09:38,840
Speaker 7: So the pandemic, I mean, there was really no control

191
00:09:38,920 --> 00:09:41,760
Speaker 7: over what happened there. I mean, obviously the scientists were

192
00:09:41,760 --> 00:09:44,560
Speaker 7: working very quickly to come up with a vaccine. The

193
00:09:44,600 --> 00:09:47,920
Speaker 7: global financial crisis, we know that there were huge underlying

194
00:09:48,480 --> 00:09:50,160
Speaker 7: issues with the financial system.

195
00:09:50,640 --> 00:09:52,679
Speaker 5: In this case, it's really about the politics.

196
00:09:52,679 --> 00:09:57,319
Speaker 7: So certainly that is something that is incredibly difficult to handicap.

197
00:09:57,800 --> 00:10:02,400
Speaker 7: I certainly am glad that I'm not the analysts they're

198
00:10:02,440 --> 00:10:05,920
Speaker 7: trying to figure out or estimate what's going on, or

199
00:10:06,280 --> 00:10:08,880
Speaker 7: a CEO thinking about whether or not now is the

200
00:10:08,920 --> 00:10:12,560
Speaker 7: time to sell my business. But I think that that

201
00:10:12,600 --> 00:10:14,640
Speaker 7: gives a little context in terms of if we can

202
00:10:14,720 --> 00:10:16,839
Speaker 7: get certainty, can we really just.

203
00:10:16,800 --> 00:10:18,920
Speaker 5: Get that that that pipeline executed.

204
00:10:19,400 --> 00:10:22,960
Speaker 6: What's the high level takeaway from bank earnings now that

205
00:10:23,000 --> 00:10:27,720
Speaker 6: we've already seen Goldman Morgan, Stanley, Wells Fargo and JP

206
00:10:27,800 --> 00:10:30,560
Speaker 6: Morgan two was on Friday, right, Yep, so we've seen

207
00:10:31,040 --> 00:10:36,040
Speaker 6: all the big banks basically report and they beat. What

208
00:10:36,080 --> 00:10:38,079
Speaker 6: are investors supposed to take away from all of this

209
00:10:38,200 --> 00:10:39,960
Speaker 6: about what it's telling us about the health of the

210
00:10:39,960 --> 00:10:41,280
Speaker 6: banking sector at large.

211
00:10:41,559 --> 00:10:43,760
Speaker 7: I think, you know, so earnings, as we know, are

212
00:10:43,760 --> 00:10:47,240
Speaker 7: backward lookings, and things looked very healthy in the first quarter.

213
00:10:47,880 --> 00:10:50,439
Speaker 7: I think that you know, as I said, there's put

214
00:10:50,520 --> 00:10:53,000
Speaker 7: some in takes, but for the most part, what we

215
00:10:53,120 --> 00:10:55,640
Speaker 7: are hearing from the management is similar to what you'd

216
00:10:55,640 --> 00:10:58,959
Speaker 7: expect with uncertainty. We do get Bank of America and

217
00:10:59,000 --> 00:11:01,040
Speaker 7: City Group tomorrow that will give us, i think, even

218
00:11:01,080 --> 00:11:03,600
Speaker 7: a richer look at terms of the US consumer, which

219
00:11:04,040 --> 00:11:05,720
Speaker 7: you know, Bank of America is a good bell weather

220
00:11:05,760 --> 00:11:07,920
Speaker 7: for a City Group has this big card business. But

221
00:11:08,440 --> 00:11:11,520
Speaker 7: the key trends we're seeing are one, you know, trade

222
00:11:11,760 --> 00:11:14,360
Speaker 7: trading strong, fees weaker, that's really.

223
00:11:14,240 --> 00:11:16,480
Speaker 5: Due to the volatility UH.

224
00:11:16,559 --> 00:11:22,000
Speaker 7: Two, buybacks strength, and buybacks coming in better than expected.

225
00:11:22,040 --> 00:11:23,240
Speaker 5: Big program at Goldman.

226
00:11:23,640 --> 00:11:27,600
Speaker 7: So really this benefit from lesser regulation UH does have

227
00:11:27,679 --> 00:11:31,240
Speaker 7: an does have an impact that we're seeing. And then third,

228
00:11:31,520 --> 00:11:34,560
Speaker 7: you know, uncertainty manifesting in credit provisions. We saw a

229
00:11:34,559 --> 00:11:37,640
Speaker 7: big provision at JP Morgan or I should say a

230
00:11:37,640 --> 00:11:41,920
Speaker 7: sizeable provision there less so Wells Fargo, but both pretty

231
00:11:41,920 --> 00:11:46,120
Speaker 7: conservative so in terms of what they're estimating going forward,

232
00:11:46,120 --> 00:11:49,520
Speaker 7: and again not based on what we've seen, but uncertainty.

233
00:11:49,640 --> 00:11:52,360
Speaker 7: We expect the same at Bank of America and City tomorrow.

234
00:11:52,640 --> 00:11:55,640
Speaker 2: What's a head count story on Wall Street these days?

235
00:11:55,800 --> 00:11:58,479
Speaker 2: I mean, if this kind of outlook, in this uncertainty,

236
00:11:59,040 --> 00:12:00,600
Speaker 2: I think we'll start cutting back head county thing.

237
00:12:00,880 --> 00:12:04,559
Speaker 7: I think that's uh exactly goes to your point earlier,

238
00:12:04,600 --> 00:12:07,520
Speaker 7: Paul about pipelines, right, so we have the pipelines. If

239
00:12:07,520 --> 00:12:09,920
Speaker 7: we get uncertainty, we can get that.

240
00:12:09,960 --> 00:12:10,320
Speaker 5: Relieve.

241
00:12:10,760 --> 00:12:14,079
Speaker 7: The CEOs are talking positive, but actions do speak louder

242
00:12:14,080 --> 00:12:14,560
Speaker 7: than words.

243
00:12:14,600 --> 00:12:17,200
Speaker 5: We did see cuts at Morgan Stanley.

244
00:12:17,400 --> 00:12:20,560
Speaker 7: Certainly they they cited their typical review being pulled forward.

245
00:12:20,600 --> 00:12:25,480
Speaker 7: They cited technology, but certainly the timing I think is instructive.

246
00:12:25,640 --> 00:12:28,559
Speaker 7: And JP Moore, I mean, sorry Gold and Zachs also

247
00:12:28,640 --> 00:12:31,120
Speaker 7: talking about cuts that they'll be making into two Q

248
00:12:31,320 --> 00:12:35,720
Speaker 7: flagging some severance charges there. So I think that signals

249
00:12:35,840 --> 00:12:38,200
Speaker 7: that when they're thinking about the revenue sort of in

250
00:12:38,240 --> 00:12:41,640
Speaker 7: the months ahead, that they do think that this uncertainty

251
00:12:41,760 --> 00:12:46,480
Speaker 7: is going to damp the potential for the coming quarters.

252
00:12:46,760 --> 00:12:49,079
Speaker 6: What about CEO pay Is it going.

253
00:12:49,080 --> 00:12:50,840
Speaker 3: To damp problem there?

254
00:12:51,040 --> 00:12:51,760
Speaker 6: No problem there.

255
00:12:52,440 --> 00:12:52,640
Speaker 3: Yeah.

256
00:12:52,679 --> 00:12:56,600
Speaker 7: So we we just got through that season and you

257
00:12:56,640 --> 00:12:58,920
Speaker 7: know that that's going to be how they navigate this

258
00:12:59,000 --> 00:12:59,520
Speaker 7: year ahead.

259
00:13:00,160 --> 00:13:02,920
Speaker 2: I mean, they're all in that thirty four thirty five

260
00:13:03,000 --> 00:13:05,959
Speaker 2: million dollars range, all in, so good for them.

261
00:13:06,760 --> 00:13:08,920
Speaker 3: They get Hey, we appreciate that. All right, Allison Williams,

262
00:13:08,960 --> 00:13:09,440
Speaker 3: thank you so much.

263
00:13:09,480 --> 00:13:10,240
Speaker 5: We appreciate that.

264
00:13:10,480 --> 00:13:14,080
Speaker 2: Allison Williams, senior Global Banks asset Managers, all that kind

265
00:13:14,080 --> 00:13:17,040
Speaker 2: of stuff for Bloomberg Intelligence. It's a busy day and

266
00:13:17,120 --> 00:13:19,319
Speaker 2: we appreciate her coming into New York City.

267
00:13:21,040 --> 00:13:24,760
Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live

268
00:13:24,840 --> 00:13:28,240
Speaker 1: weekdays at ten am Eastern on Applecarplay and Android Auto

269
00:13:28,320 --> 00:13:31,400
Speaker 1: with the Bloomberg Business app. Listen on demand wherever you

270
00:13:31,440 --> 00:13:34,400
Speaker 1: get your podcasts, or watch us live on YouTube.

271
00:13:35,240 --> 00:13:36,840
Speaker 3: Mikey Shaw joins us here.

272
00:13:36,880 --> 00:13:40,120
Speaker 2: He's the senior Farmer, farmer and biotech analysts for Bloomberg Intelligence.

273
00:13:40,160 --> 00:13:43,720
Speaker 2: He's in London and he covers all these big farmer

274
00:13:43,840 --> 00:13:49,880
Speaker 2: companies and big one today Mikey Pfizer abandoning it's obesity pill.

275
00:13:50,800 --> 00:13:53,079
Speaker 2: That sounds like a big deal because I keep reading

276
00:13:53,120 --> 00:13:55,480
Speaker 2: the research you and your colleagues over there putting out

277
00:13:55,480 --> 00:13:56,880
Speaker 2: about this obesity market.

278
00:13:57,160 --> 00:13:58,280
Speaker 3: This is a big market.

279
00:13:58,320 --> 00:14:01,200
Speaker 2: And for Pfizer to have this big miss year, how

280
00:14:01,240 --> 00:14:02,720
Speaker 2: big of an issue is it for Pfizer.

281
00:14:04,120 --> 00:14:06,319
Speaker 8: Yeah, I mean I think it's it's a sentiment issue.

282
00:14:06,440 --> 00:14:09,600
Speaker 8: I mean, clearly, you know, you've got a massive BC

283
00:14:09,800 --> 00:14:12,120
Speaker 8: market out there, you know, one hundred billion dollar plus

284
00:14:12,280 --> 00:14:16,040
Speaker 8: in terms of sides, and it's a market where you know,

285
00:14:16,120 --> 00:14:19,240
Speaker 8: Phizes already kind of trailing large farm appears like Lily

286
00:14:20,480 --> 00:14:25,320
Speaker 8: rosch Novo in terms of you know, the BC pill itself.

287
00:14:25,400 --> 00:14:29,960
Speaker 8: So this was Danny Glippron. So what what it they

288
00:14:30,000 --> 00:14:34,080
Speaker 8: actually did was it used to be a twice daily pill.

289
00:14:35,320 --> 00:14:37,680
Speaker 8: They kind of can that and repurposed it into a

290
00:14:37,720 --> 00:14:40,640
Speaker 8: once daily following the failure of another one of their

291
00:14:40,640 --> 00:14:45,200
Speaker 8: OBCs pills, Glippron. So I'd say, you know, confidence into

292
00:14:45,240 --> 00:14:47,960
Speaker 8: this readout, you know, was pretty low. We had ready

293
00:14:48,120 --> 00:14:50,560
Speaker 8: kind of removed it from our models, you know, back

294
00:14:50,600 --> 00:14:54,040
Speaker 8: in twenty three. But what it does, you know, create

295
00:14:54,200 --> 00:14:57,560
Speaker 8: is you know to two concerns. One is you know,

296
00:14:57,600 --> 00:15:00,960
Speaker 8: the trailing timeline in the BCC space, and two it

297
00:15:01,040 --> 00:15:02,840
Speaker 8: kind of adds to the mid to long term growth

298
00:15:03,080 --> 00:15:06,040
Speaker 8: worries of the company. So they've got you know, about

299
00:15:06,040 --> 00:15:09,640
Speaker 8: fifteen billion dollars in and lost revenue to looees that

300
00:15:09,640 --> 00:15:12,600
Speaker 8: they'll need to kind of offset over twenty five to

301
00:15:12,600 --> 00:15:16,400
Speaker 8: twenty nine. And at the moment, you know, it's quite

302
00:15:16,440 --> 00:15:19,600
Speaker 8: hard to see you know where that where that offset

303
00:15:19,640 --> 00:15:22,080
Speaker 8: and where that additional growth is going to come come from.

304
00:15:22,120 --> 00:15:25,640
Speaker 8: Long term obesity would be kind of one pillar. But

305
00:15:25,720 --> 00:15:28,240
Speaker 8: you know, following the Danaglipron read out today or the

306
00:15:28,320 --> 00:15:32,560
Speaker 8: news today, you know, that's obviously mean terminated. So you know,

307
00:15:32,600 --> 00:15:34,040
Speaker 8: we think that they're going to have to go to

308
00:15:34,440 --> 00:15:38,840
Speaker 8: you know, look to external assets in the OBC space

309
00:15:39,000 --> 00:15:42,640
Speaker 8: if they're going to remain a relevant player in the

310
00:15:42,720 --> 00:15:43,440
Speaker 8: in that market.

311
00:15:44,360 --> 00:15:48,520
Speaker 6: Is anyone else doing obesity pills in this market right now?

312
00:15:49,800 --> 00:15:52,160
Speaker 8: Yeah, So, I mean there's a few biotechs out there

313
00:15:52,560 --> 00:15:54,240
Speaker 8: that are that are doing pills. In terms of the

314
00:15:54,320 --> 00:15:57,360
Speaker 8: large farmer competitors, you know, Lily's got one, we'll see

315
00:15:57,360 --> 00:16:00,320
Speaker 8: the data for that this year phase three that couldotentially

316
00:16:00,360 --> 00:16:04,520
Speaker 8: launching in twenty six. Novo's got one they're expected to

317
00:16:04,560 --> 00:16:08,280
Speaker 8: file and then you know, Rush also has one kind

318
00:16:08,320 --> 00:16:11,080
Speaker 8: of in early to mid stage development too. On the

319
00:16:11,120 --> 00:16:13,920
Speaker 8: biotech front. You know, we're seeing moves for you know,

320
00:16:14,080 --> 00:16:17,920
Speaker 8: Viking structure turns, you know, all positive share price moves

321
00:16:17,920 --> 00:16:21,160
Speaker 8: today and they all hold or all JP ones in

322
00:16:21,200 --> 00:16:21,880
Speaker 8: their pipeline.

323
00:16:21,880 --> 00:16:22,120
Speaker 4: Two.

324
00:16:22,360 --> 00:16:23,280
Speaker 3: Hey, Mikey, can.

325
00:16:23,160 --> 00:16:26,720
Speaker 2: You put into just perspective the size of this obesity

326
00:16:27,440 --> 00:16:32,480
Speaker 2: market relative to other big verticals that drive these farmer companies.

327
00:16:34,360 --> 00:16:37,120
Speaker 8: I mean, I think the excitement around RABESTI is you

328
00:16:37,160 --> 00:16:40,880
Speaker 8: know one, it's you know, prevalence is rising. You got

329
00:16:40,880 --> 00:16:46,240
Speaker 8: forty percent of US adults at the moment they are obese,

330
00:16:46,560 --> 00:16:51,360
Speaker 8: and it's a relatively underpenetrated market. So I mean, you know,

331
00:16:51,560 --> 00:16:55,320
Speaker 8: penetration rates are you know, low single digits, you know

332
00:16:55,360 --> 00:16:57,960
Speaker 8: in the US at the moment, you know, probably even

333
00:16:58,040 --> 00:17:04,400
Speaker 8: lower elsewhere, you know, globally, And you know, we think

334
00:17:04,440 --> 00:17:06,480
Speaker 8: that this market could grow, you know, well in excess

335
00:17:06,480 --> 00:17:10,159
Speaker 8: of one hundred billion dollars. So yeah, I mean it's

336
00:17:10,160 --> 00:17:13,919
Speaker 8: a massive opportunity. I think in terms of you know,

337
00:17:14,040 --> 00:17:19,000
Speaker 8: drug classes, I think PD you know, immuno oncology PD

338
00:17:19,119 --> 00:17:21,480
Speaker 8: are one PD one drugs you know, with the kind

339
00:17:21,560 --> 00:17:23,960
Speaker 8: of biggest class to date in terms of sales. So

340
00:17:24,040 --> 00:17:27,840
Speaker 8: that's like your contruder Bristol ORPDVO, but you know GLP

341
00:17:27,960 --> 00:17:30,239
Speaker 8: ones could potentially surpass that.

342
00:17:30,640 --> 00:17:34,399
Speaker 6: So Michael, where does Fizer go from here after this setback?

343
00:17:36,280 --> 00:17:40,040
Speaker 6: Do they I mean, do they double down on OBESIT pills?

344
00:17:40,080 --> 00:17:42,320
Speaker 6: Do they do they try something new? What's the plan

345
00:17:42,400 --> 00:17:43,040
Speaker 6: here for Pfizer?

346
00:17:44,400 --> 00:17:46,720
Speaker 8: So, I mean they've got another oral jolp one in

347
00:17:46,760 --> 00:17:49,600
Speaker 8: their pipeline, So it's in phase one. It's being developed

348
00:17:49,600 --> 00:17:53,160
Speaker 8: for diabetes. Notatural you know whether or not they can

349
00:17:53,240 --> 00:17:56,919
Speaker 8: also look at that in obesity two. But clearly the

350
00:17:56,960 --> 00:17:59,679
Speaker 8: timeline here is the issue. You know, you've got oral

351
00:17:59,760 --> 00:18:02,520
Speaker 8: jill wants coming to market in twenty six onwards. You'll

352
00:18:02,520 --> 00:18:05,919
Speaker 8: probably have a wave of new treatments coming in, you know,

353
00:18:06,000 --> 00:18:09,119
Speaker 8: towards the end of the end of the decade. So

354
00:18:09,200 --> 00:18:10,760
Speaker 8: you know, we really think that Fiser is going to

355
00:18:10,800 --> 00:18:12,919
Speaker 8: have to go out, you know, either in license at

356
00:18:12,960 --> 00:18:15,639
Speaker 8: jilp one or do some sort of M and A.

357
00:18:16,160 --> 00:18:18,200
Speaker 8: They're well positioned to do that. You know, they've got

358
00:18:18,240 --> 00:18:21,320
Speaker 8: ten to fifteen billion of M and A firepower, you

359
00:18:21,359 --> 00:18:26,680
Speaker 8: know to four acquisitions. So that's really you know, how

360
00:18:26,720 --> 00:18:28,840
Speaker 8: we think that they're going to do, you know, play

361
00:18:28,880 --> 00:18:32,159
Speaker 8: catch up in this space in terms of you know,

362
00:18:32,200 --> 00:18:34,399
Speaker 8: I mentioned some biotechs out there that have you know,

363
00:18:34,480 --> 00:18:38,960
Speaker 8: quite appealing assets. You know, you've also got China too,

364
00:18:39,720 --> 00:18:41,960
Speaker 8: so you know we've seen some you know, very competitive

365
00:18:42,040 --> 00:18:45,440
Speaker 8: data in Chinese patients for some of those domestic players.

366
00:18:46,640 --> 00:18:49,000
Speaker 8: And you know we've seen the lights of Novo Astra

367
00:18:49,200 --> 00:18:51,960
Speaker 8: Mark kind of all kind of you know, delve into

368
00:18:52,000 --> 00:18:56,840
Speaker 8: China's R and D locker to essentially bolster their OBCI pipelines.

369
00:18:57,600 --> 00:18:59,639
Speaker 2: All right, hey, Mike, you know we much prefer to

370
00:18:59,680 --> 00:19:02,600
Speaker 2: talk to you than Sam Fazzelli. This is a nice refreshman.

371
00:19:02,840 --> 00:19:05,960
Speaker 2: So we hired Mikey Shaw like a million years ago.

372
00:19:06,000 --> 00:19:08,520
Speaker 3: He was a kid. Now he's a grizzled veteran.

373
00:19:08,680 --> 00:19:10,720
Speaker 2: I see little gray hair there, and he's one of

374
00:19:10,720 --> 00:19:14,360
Speaker 2: the leading pharmaceutical analysts all across Europe and we appreciate

375
00:19:14,359 --> 00:19:16,200
Speaker 2: getting a few minutes of his time. Mikey Shaw senior

376
00:19:16,200 --> 00:19:18,960
Speaker 2: Pharma and biotech analysts for Bloomberg Intelligence as part of

377
00:19:18,960 --> 00:19:22,119
Speaker 2: that just that great global healthcare team that we have

378
00:19:22,160 --> 00:19:25,360
Speaker 2: at Bloomberg Intelligence, led by Sam Fazzelli.

379
00:19:26,280 --> 00:19:30,959
Speaker 1: This is the Bloomberg Intelligence podcast, available on Apple, Spotify

380
00:19:31,160 --> 00:19:34,640
Speaker 1: and anywhere else you get your podcasts. Listen live each

381
00:19:34,640 --> 00:19:38,400
Speaker 1: weekday ten am to noon Eastern on Bloomberg dot com,

382
00:19:38,520 --> 00:19:42,080
Speaker 1: the iHeartRadio app tune In, and the Bloomberg Business app.

383
00:19:42,480 --> 00:19:45,400
Speaker 1: You can also watch us live every weekday on YouTube

384
00:19:45,800 --> 00:19:48,880
Speaker 1: and always on the Bloomberg terminal