Latest / Bloomberg Intelligence / BI Weekend: Nvidia, Retail Earnings, Anthropic Investment

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BI Weekend: Nvidia, Retail Earnings, Anthropic Investment · Bloomberg Intelligence

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  Speaker 2: Today, we'll look at earnings reports from some of the
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  Speaker 2: world's largest retailers.
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  Speaker 2: We'll begin with earnings from chip Giant and Video.
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  Speaker 3: This week, the company reported third quarter earnings that topped
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  Speaker 3: analyst estimates, and Vidia also delivered a surprisingly strong revenue
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  Speaker 3: forecast and pushback on the idea that the AI industry
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  Speaker 3: is in a bubble.
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  Speaker 2: For more, we were joined by Kunjohn Sabani, Bloomberg Intelligence
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  Speaker 2: Senior Semiconductor analyst. We first asked Kunjohn for his take
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  Speaker 2: on in Vidia this week.
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  Speaker 4: This was one of the more bullish earnings we have
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  Speaker 4: seen from this name in a while, not just on
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  Speaker 4: the numbers of the three Q four Q guide, which
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  Speaker 4: they blew past even the loftiest Byside targets, but just
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  Speaker 4: beyond that the long term the twenty six sort of
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  Speaker 4: and going into twenty seven demands signals that they showed,
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  Speaker 4: namely the half a trillion of the pipeline, which we
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  Speaker 4: think now is a conservative number given the number of
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  Speaker 4: deals they have announced. If supply keeps on coming up
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  Speaker 4: as it has, and if their customers continue executing on
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  Speaker 4: these bills without any missteps, we think their significant upside
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  Speaker 4: to the current numbers.
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  Speaker 3: Yeah, just looking through the numbers, clearly a beaten Rais report,
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  Speaker 3: but you know, the scale at which it can be
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  Speaker 3: in race is impressive. Although within the third quarter numbers,
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  Speaker 3: I did see that chips used in gaming PCs missed
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  Speaker 3: analess estimates, and I know that that's a shrinking part
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  Speaker 3: of the business, or at least it's not as big
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  Speaker 3: a part of the business, given that the data center
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  Speaker 3: is where the growth is really at. Are there any
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  Speaker 3: flaws in this earnings report? Conjohn?
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  Speaker 4: Not really? I mean, look, the gaming is becoming so
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  Speaker 4: unimportant for analysts that the reliability of the predictability of
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  Speaker 4: those numbers against which we are comparing the bet and
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  Speaker 4: miss for gaming is no longer as reliable. So no
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  Speaker 4: real flaws to really point out in this. We did
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  Speaker 4: see their supply commitments go up quarter work quarter and
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  Speaker 4: inventory is rising. I don't think that's a negative. While
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  Speaker 4: it might seem on the face that's just them getting
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  Speaker 4: up and getting ready for that next wave to supply
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  Speaker 4: the chips in the next year.
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  Speaker 2: So could John what's the latest and Gentin want about
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  Speaker 2: how he've used China going forward?
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  Speaker 4: Nothing has changed on the China side. They still don't
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  Speaker 4: assume any revenues when it comes to data center AI
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  Speaker 4: China GPUs or the H twenty has been shipped into
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  Speaker 4: They do have the clearance licenses so they could, but
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  Speaker 4: it seems because of the geopolitical issues, China has basically
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  Speaker 4: been shut down for American GPU providers or AC providers
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  Speaker 4: to be able to ship in the country. There isn't,
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  Speaker 4: to be honest, no demand. So it seems, you know,
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  Speaker 4: because of geopolitical issues, the customers in China are not
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  Speaker 4: just reading and getting up to buy in media chips
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  Speaker 4: right now.
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  Speaker 3: Jensenhang said that he from his vantage point, does not
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  Speaker 3: see anything like an AI bubble. We see something very different,
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  Speaker 3: and he says competitive pressures remain fairly low because this
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  Speaker 3: is a company with more than ninety percent of the
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  Speaker 3: market for those high end super fast AI chips. Who
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  Speaker 3: is the closest competitor if there is one t Invidia.
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  Speaker 4: Yeah, in terms of the size of the markets, the
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  Speaker 4: next closest competitor would be the AIA six chips, So
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  Speaker 4: Broadcome is one of the biggest providers of AI six chips,
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  Speaker 4: namely the TPU that Google uses. Another example would be
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  Speaker 4: Amazon's Treanium chips, which are on different AI asic designers supply.
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  Speaker 4: So in terms of revenues, or units in terms of
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  Speaker 4: the market that those are the next closest competitors within
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  Speaker 4: Nvidia's realm, which it sells merchant gipus, AMD would be
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  Speaker 4: the second closest competitor in that our Thanks.
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  Speaker 3: To Kunjan Sabani, Bloomberg Intelligence Senior semiconductor analyst.
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  Speaker 2: We continue in the tech space.
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  Speaker 3: This week we heard that the tech giants Microsoft and
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  Speaker 3: Nvidia are committing to invest up to a combined fifteen
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  Speaker 3: billion dollars in the AI research and development company Anthropic.
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  Speaker 2: We heard the investment will be part of anthropics next
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  Speaker 2: funding round. The companies also said Anthropic has committed to
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  Speaker 2: purchase thirty billion dollars of computing capacity for Microsoft's Azure
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  Speaker 2: cloud service.
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  Speaker 3: So of course we had to enlist. Mandeep Singh, global
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  Speaker 3: tech research head at Bloomberg Intelligence.
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  Speaker 2: First asked man Deep to tell us a little more
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  Speaker 2: about Anthropic and what it does well.
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  Speaker 5: Anthropic is one of the five frontier lms that are remaining,
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  Speaker 5: I mean, and they are leading the charge when it
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  Speaker 5: comes to generative AI. So it's one of the five.
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  Speaker 5: The other one are Google, Open Ai, Meta and XAI.
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  Speaker 5: And so look, when it comes to these commitments, it's
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  Speaker 5: pretty obvious that open Ai has raised the bar by
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  Speaker 5: announcing they're going to spend one point four trillion. So
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  Speaker 5: the question is what are the other LLM companies going
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  Speaker 5: to do? And Entropic is also a pure play LLLM,
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  Speaker 5: and in their case, they don't have the funding. I mean,
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  Speaker 5: they don't have the balance sheet like Google or Meta have,
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  Speaker 5: so they have to raise the money either in the
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  Speaker 5: private markets or from someone like Nvidia, or get into
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  Speaker 5: an agreement with Microsoft, which also has an agreement with
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  Speaker 5: open Ai. So that's where you know. Llms need compute.
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  Speaker 5: That's how you serve billion plus users, and that's where
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  Speaker 5: you know the numbers get bigger and bigger when it
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  Speaker 5: comes to the tie ups with cloud provider.
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  Speaker 3: This is like the popular click in high school, where
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  Speaker 3: everyone knows each other and everyone's messing around with each other.
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  Speaker 3: Just give us a little bit of background here on Anthropic,
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  Speaker 3: because my understanding is that it was founded by folks
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  Speaker 3: who used to work at open Ai and some of
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  Speaker 3: the early investors like big stakeholders include Alphabet and include
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  Speaker 3: Amazon and now you've got Microsoft in there. I mean,
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  Speaker 3: is there anyone who's not part of Anthropic and not
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  Speaker 3: committed to investing in this company.
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  Speaker 5: Well, you could say Meta, they're doing things.
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  Speaker 3: They're doing their own thing.
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  Speaker 5: They are doing their own thing in terms of, you know,
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  Speaker 5: using the computer internally, and they don't have a cloud business.
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  Speaker 3: Is that a problem for them that Meta's out there
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  Speaker 3: on its own I know, it doesn't have its own
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  Speaker 3: cloud business, but it's not buying stakes or committed to
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  Speaker 3: invest up to five billion or ten billion in any
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  Speaker 3: of these AI companies.
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  Speaker 5: I mean so far, just to go to Meta, it
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  Speaker 5: feels like, you know, investors were okay with them using
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  Speaker 5: the GPU compute for their own family of apps. But
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  Speaker 5: the fact that they're talking about one hundred billion plus
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  Speaker 5: in capex for next year without having a substantial ROI
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  Speaker 5: and what I mean by rois in the case of Microsoft,
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  Speaker 5: yes they're raising their CAPEX two hundred and twenty billion,
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  Speaker 5: but they're winning deals like the one with Nthropic thirty
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  Speaker 5: billion dollar in commitment from Entropic, so somebody is paying
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  Speaker 5: for that compute. In the case of Microsoft, you don't
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  Speaker 5: have that with a Meta. How are you generating ROI
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  Speaker 5: outside of your family of apps? And over there you
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  Speaker 5: have to show a really substantial increase in engagement to
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  Speaker 5: convince investors it's worth hundred billion plus in capex.
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  Speaker 2: Any of these open aies anthropics, are they going to
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  Speaker 2: ever come public? Do you think?
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  Speaker 5: I mean, in the case of Entropic, look, I know
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  Speaker 5: the numbers are getting big, but their gross margins at
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  Speaker 5: this point are probably better than open AI, which is
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  Speaker 5: doing too much any things. I mean, the biggest risk
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  Speaker 5: I see for Opening Eyes they feel they can get
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  Speaker 5: into any business, whether it's chip business, whether it's you know,
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  Speaker 5: obviously LLLM is their turf, any type of applications, and
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  Speaker 5: that's where there's a possibility of a misstep. You can
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  Speaker 5: end up wasting time because you just don't have, uh,
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  Speaker 5: you know, the capability. Yeah, the focus Entropic is more.
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  Speaker 3: Focused our thanks Toman deep saying, global tech research head
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  Speaker 3: at Bloomberg Intelligence.
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  Speaker 2: We move next to some earnings from some of the
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  Speaker 2: world's largest retailers.
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  Speaker 1: This week.
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  Speaker 3: Target posted a drop in third quarter sales due to
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  Speaker 3: intense competition and a weakening economy, with shoppers pulling back
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  Speaker 3: on apparel and home goods.
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  Speaker 2: Separately, Walmart reported third quarter earnings that beat analysts expectations.
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  Speaker 2: The retailer also increased its outlook for sales in the
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  Speaker 2: full year. It's a sign Walmart is winning over priced
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  Speaker 2: sensitive shoppers while digesting costs it expects to rise in
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  Speaker 2: the coming months.
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  Speaker 3: For more, we were joined by Jennifer bartashis Bloomberg Intelligence
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  Speaker 3: senior analysts covering retail staples and packaged foods.
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  Speaker 2: First test jenf for her take on the most recent
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  Speaker 2: results at Walmart.
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  Speaker 6: You know, Walmart had another good quarter, and I think
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  Speaker 6: that it's very easy to attribute a lot of their
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  Speaker 6: success to just the value seeking behavior of consumers in
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  Speaker 6: this environment. But I think that would also be overlooking
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  Speaker 6: a lot of the investments they've made in things like
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  Speaker 6: convenience that is really spurring the e commerce growth. And
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  Speaker 6: that was really a notable takeaway.
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  Speaker 3: Yeah, that e commerce aspect helps draw on higher income shoppers,
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  Speaker 3: so it's a larger pool of customers at Walmart now
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  Speaker 3: has access to and in our Bloomberg News reporting we
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  Speaker 3: indicate that the digital offerings now include luxury items like
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  Speaker 3: pre owned Chanel bags. I had no idea that that
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  Speaker 3: kind of stuff was available on walmart dot com.
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  Speaker 6: Well, you know, Walmart has done a lot to really
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  Speaker 6: expand its marketplace, and that includes bringing in items that
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  Speaker 6: you know, will appeal to that higher income consumer, you know,
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  Speaker 6: And the tactic behind all of this is that the
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  Speaker 6: more people are integrated with e commerce in going to stores,
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  Speaker 6: they become sticky and they become loyal customers, so that
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  Speaker 6: when the macre can comic backdrop fades, it really increases
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  Speaker 6: Walmart's ability to hang onto these customers going forward, and
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  Speaker 6: that just drives future growth. So it's a really interesting
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  Speaker 6: play out of how they're applying that tactic.
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  Speaker 3: Jen, I also want to get your take on Walmart transferring.
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  Speaker 3: It's listing to the NASAC that's going to happen on
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  Speaker 3: December ninth, and that of course is to reflect as
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  Speaker 3: focus on being a tech forward company. But I'm wondering,
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  Speaker 3: I mean, how much of this is really just about
• 10:25
  Speaker 3: being included in the Nazak one hundred and therefore the
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  Speaker 3: qqq etl Oh.
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  Speaker 6: Yeah, there's certainly part of that scarlet where you know,
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  Speaker 6: that's that's probably part of the motivation. I think that
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  Speaker 6: there is. You know, obviously there's a perception with regards
• 10:40
  Speaker 6: to being perceived more as a tech company, which Walmart
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  Speaker 6: in all truthfulness, has evolved into a tech company, especially
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  Speaker 6: amongst other retailers. By being listed at NASDAK, you know,
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  Speaker 6: long term, maybe it helps their valuation, you know, just
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  Speaker 6: in terms of having that perception of being more you know,
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  Speaker 6: aligned with peers. You know, Amazon listed on Nasdaq, things
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  Speaker 6: like that. So I think that there's a lot of
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  Speaker 6: those components together combined, are really behind the move.
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  Speaker 2: Jen nobody arguably has a better finger on the pulse
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  Speaker 2: of the consumer than Walmart. What are they saying these days?
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  Speaker 6: Actually, they seem relatively optimistic. You know, they talk about
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  Speaker 6: you know, spending, holding study for kind of that middle
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  Speaker 6: income consumer, high end consumer seemed to be spending pretty freely,
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  Speaker 6: a little bit of concern about some of the lower
• 11:27
  Speaker 6: end consumer, but it does seem to be sort of
• 11:30
  Speaker 6: evening out. And so when they were looking forward to
• 11:32
  Speaker 6: the holiday season, which is you know, the most important
• 11:35
  Speaker 6: thing with regards to the retailers that I cover, they
• 11:38
  Speaker 6: seem cautiously optimistic that there will be a pretty good
• 11:41
  Speaker 6: holiday season this year. We do think that they're going
• 11:44
  Speaker 6: to people will prioritize spending on kids. That's usually what
• 11:47
  Speaker 6: happens first if they're holding back in other parts of
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  Speaker 6: their budget. But all indicators right now seem that we're
• 11:53
  Speaker 6: headed towards a reasonably solid holiday season.
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  Speaker 3: Are thanks to Jennifer Bartash's Bloomberg Intelligence senior analysts covering retail,
• 12:00
  Speaker 3: staples and packaged food. Coming up, we'll take a look
• 12:02
  Speaker 3: at why the global payments services provider Klarna reported record
• 12:06
  Speaker 3: revenue in its first quarter since going public.
• 12:08
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  Speaker 1: This is Bloomberg Intelligence with Scarlet Foo and Paul Sweeney
• 12:29
  Speaker 1: on Bloomberg Radio.
• 12:31
  Speaker 2: We move next to earnings from some of the world's
• 12:33
  Speaker 2: largest home improvement retailers.
• 12:35
  Speaker 3: This week, Low's reported third quarter profit that topped analyst estimates.
• 12:38
  Speaker 3: This was a result of online sales and demand from
• 12:41
  Speaker 3: professional contractors.
• 12:42
  Speaker 2: Separately, we heard from Home Depot, who cut its full
• 12:44
  Speaker 2: of your guidance. This come as a company warned that
• 12:46
  Speaker 2: some unsteady consumers are hitting the pause button on big
• 12:49
  Speaker 2: ticket home purchases.
• 12:50
  Speaker 3: So we spoke with Drew Redding Bloomberg Intelligence US home
• 12:53
  Speaker 3: building analyst.
• 12:54
  Speaker 2: We first Saske Drew to break down this week's results
• 12:56
  Speaker 2: from Low's and how they compare it to Home Depots.
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  Speaker 7: So, I think Loew's result could be best characterized as
• 13:02
  Speaker 7: better than feared, particularly in light of what we heard
• 13:05
  Speaker 7: from Home Depot. They did fall short of consensus estimates
• 13:09
  Speaker 7: on same store sales, but I think the buy side
• 13:11
  Speaker 7: was probably looking for something flat to lower, so a
• 13:14
  Speaker 7: little bit better than they were looking for. Now that
• 13:18
  Speaker 7: being said, they did trim their four year outlook. Now
• 13:21
  Speaker 7: they're looking for four year comp sales to be flat
• 13:23
  Speaker 7: from flat to up one percent, So that would imply
• 13:26
  Speaker 7: that four Q is relatively flat. But you know, similar
• 13:29
  Speaker 7: to what we heard from Home Depot, they had about
• 13:31
  Speaker 7: one hundred basis point impact from hurricane activity that was
• 13:35
  Speaker 7: not replicated this year. So again, if you were to
• 13:38
  Speaker 7: back that out, it looks like the underlying trends in
• 13:40
  Speaker 7: the business are pretty stable.
• 13:43
  Speaker 5: You know.
• 13:43
  Speaker 7: That being said, they're still grappling with the same consumer
• 13:46
  Speaker 7: uncertainty and you know, the same weak housing market that
• 13:49
  Speaker 7: their competitors, so you know, still challenges out there in
• 13:52
  Speaker 7: the market.
• 13:53
  Speaker 2: Drew, I think I understand it. Correctly that Lows has
• 13:57
  Speaker 2: a lower percentage of sales to professional contractors than does
• 14:00
  Speaker 2: Home Depot If so, are they trying to narrow the gap?
• 14:03
  Speaker 2: Are they targeting that segment a little more?
• 14:05
  Speaker 7: Yeah, great question. So Low's is about thirty percent professional
• 14:08
  Speaker 7: contractors seventy percent DIY. Home Depot is about fifty to
• 14:13
  Speaker 7: fifty maybe even a little bit higher on the pro front.
• 14:16
  Speaker 7: What's interesting, and to your point on investment, is the
• 14:19
  Speaker 7: pro space, especially in building products distribution, has really become
• 14:24
  Speaker 7: a battleground among home improvement retailers. You had Home Depot
• 14:28
  Speaker 7: recently do acquisitions for srs and gms, and then you
• 14:33
  Speaker 7: have Lows who recently acquired foundation building materials, So it's
• 14:37
  Speaker 7: certainly an area where they're making a concerted effort to grow. Now.
• 14:41
  Speaker 7: Lows has historically focused on the small and medium sized
• 14:45
  Speaker 7: pro and what this acquisition does is it gives them
• 14:48
  Speaker 7: exposure to larger pros who do more complex projects, so
• 14:52
  Speaker 7: they're able to be the supplier of choice across more
• 14:57
  Speaker 7: building product categories and at a larger scale.
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  Speaker 3: So basically directly competing with Home DEEPO in many ways.
• 15:03
  Speaker 3: Is this going to become a duopoly or are there's
• 15:05
  Speaker 3: still a lot of other places that professional contractors can
• 15:09
  Speaker 3: go to.
• 15:10
  Speaker 7: Yeah, so the building products distribution space is still very
• 15:14
  Speaker 7: highly fragmented, you know, I wouldn't be surprised to see
• 15:17
  Speaker 7: further consolidation within the industry, you know, across different categories.
• 15:22
  Speaker 7: Home Depot and Lows are certainly, you know, two of
• 15:25
  Speaker 7: the behemoths in the industry who have, you know, the
• 15:27
  Speaker 7: scale and financial flexibility to further consolidate the industry. But
• 15:31
  Speaker 7: there's some other players as well, like QXO. So it
• 15:35
  Speaker 7: is a mented industry, but I would expect, you know,
• 15:38
  Speaker 7: in the coming years, it's something that continues to get consolidated.
• 15:41
  Speaker 2: I can't keep track of where all the tariffs are
• 15:43
  Speaker 2: these days on all the different products, but I'm just
• 15:45
  Speaker 2: guessing if I'm a Low's or Home Depot, my plywood
• 15:48
  Speaker 2: from Canada that's probably being tariff A power tool from
• 15:51
  Speaker 2: somewhere in Asia that's probably subject to tariff's. How are
• 15:54
  Speaker 2: these companies dealing with it? What have they been telling
• 15:57
  Speaker 2: you guys?
• 15:58
  Speaker 7: So, Lows gets about sixty percent of its products from
• 16:01
  Speaker 7: the US, so their exposure internationally is maybe not as
• 16:05
  Speaker 7: high as you would expect. China's probably around fifteen to
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  Speaker 7: twenty percent. You know, there hasn't been a whole lot
• 16:10
  Speaker 7: of talk. I think we have seen their average ticket
• 16:13
  Speaker 7: increase this quarter was up about three percent, and part
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  Speaker 7: of that is in response to tariff related price increases.
• 16:19
  Speaker 7: Loose told us that they were only modest increases, and
• 16:22
  Speaker 7: you know, they'll take a portfolio approach to how they
• 16:24
  Speaker 7: increase prices. They'll look at their product line up and
• 16:27
  Speaker 7: see where they have more elasticity. But I think the
• 16:30
  Speaker 7: impact of costs will start to come in a little
• 16:32
  Speaker 7: greater as we look into Q four in early twenty
• 16:35
  Speaker 7: twenty six. And you know some of the areas that
• 16:37
  Speaker 7: we're looking at. You mentioned plywood so lumber tariffs from Canada.
• 16:41
  Speaker 7: We also had the implementation of tariffs on cabinetry both
• 16:45
  Speaker 7: the kitchen and bath, which to go up to fifty
• 16:47
  Speaker 7: percent in January. So I do think that the impact
• 16:50
  Speaker 7: gets a little greater as we look at the next year.
• 16:52
  Speaker 7: So I would expect further price increases from both retailers.
• 16:56
  Speaker 3: Are Thanks to Drew Reading Bloomberg Intelligence, US home building analyst.
• 16:59
  Speaker 2: We've moved to third quarter earnings from the global payment
• 17:02
  Speaker 2: services provider Klina this week.
• 17:04
  Speaker 3: Kliner reported record revenue that beat analysts estimates on Wall Street.
• 17:07
  Speaker 3: The firm also set aside more provisions for credit losses
• 17:10
  Speaker 3: in its first set of earnings since going public.
• 17:12
  Speaker 2: For more, I was joined by Anthony Hughes, Bloomberg Equity
• 17:15
  Speaker 2: Capital Markets reporter. I first asked Anthony to talk to
• 17:18
  Speaker 2: us about Cliner's most recent results.
• 17:20
  Speaker 8: Yeah, Well, klan is a company that's actually been around
• 17:22
  Speaker 8: for about two decades. It's just that since about twenty
• 17:26
  Speaker 8: and nineteen they've really expanded quickly in.
• 17:28
  Speaker 2: The US and by now.
• 17:29
  Speaker 8: Pay Later is a lending slash payments product which basically
• 17:32
  Speaker 8: allows people to buy products and obviously pay for them
• 17:38
  Speaker 8: over time. And this is an alternative to the credit
• 17:41
  Speaker 8: card in a credit card option. So really a lot
• 17:45
  Speaker 8: of Klana's growth really reflects the fact that this product's
• 17:48
  Speaker 8: becoming more popular relative to credit cards and for a
• 17:50
  Speaker 8: lot of consumers, it's a good way to manage your
• 17:52
  Speaker 8: cash flow and you know, obviously buy a product and
• 17:55
  Speaker 8: not have to pay for over time, and that suits
• 17:56
  Speaker 8: a lot of people, and it is a fast growing
• 17:58
  Speaker 8: part of the fintech or say consumer lending space.
• 18:02
  Speaker 2: And as a consumer, how does Clorina make money on
• 18:07
  Speaker 2: my one hundred dollars purchase that they put on their system. Yeah,
• 18:10
  Speaker 2: well they trudge me interest.
• 18:12
  Speaker 8: No, well, this number of different products that some of
• 18:15
  Speaker 8: the longer term lending products do have interests associated with them.
• 18:17
  Speaker 8: But that paying for product they talk about, which is
• 18:21
  Speaker 8: paying in four installments over a few months, that is
• 18:24
  Speaker 8: an interest free product. And really the source of revenue
• 18:26
  Speaker 8: in this in that instance is from the merchant, and
• 18:29
  Speaker 8: merchants pay merchant service fee. It's high for them, it's
• 18:32
  Speaker 8: higher than they pay on a credit card transaction. But
• 18:35
  Speaker 8: basically they see the benefit of Klana bringing in extra
• 18:39
  Speaker 8: customers so they can sell more product. And you know,
• 18:42
  Speaker 8: people will ask themselves, well, who actually pays the merchant
• 18:44
  Speaker 8: service fee? While the merchant does pay that to Klana,
• 18:47
  Speaker 8: but the merchant does incorporate that as a cost of
• 18:50
  Speaker 8: doing business into the products that these sells to you
• 18:52
  Speaker 8: and I. So we in the sense we all pay
• 18:55
  Speaker 8: for the fees that are hidden within the payment system
• 19:00
  Speaker 8: and really merchants passed on to the consumer depending on
• 19:03
  Speaker 8: how you pay the interesting you pay for.
• 19:05
  Speaker 2: Your who's a typical Klarner consumer out there? Like what
• 19:09
  Speaker 2: what's and what's kind of a typical transaction for a
• 19:12
  Speaker 2: buy nine.
• 19:12
  Speaker 8: Yeah, well, these are mainly small transactions of you know,
• 19:15
  Speaker 8: can be a few hundred dollars or you know, not
• 19:17
  Speaker 8: not not large transactions. And and you know, this obviously
• 19:21
  Speaker 8: suits a younger audience, and that's where a lot of
• 19:24
  Speaker 8: the you know, a lot of their customer bases come from.
• 19:26
  Speaker 8: But they've built a large business which globally has something
• 19:30
  Speaker 8: like one hundred and ten billion of what they call
• 19:33
  Speaker 8: gross merchandise volume, and that's you know, it's a fast
• 19:36
  Speaker 8: growing business in the US. It's been growing pretty fast
• 19:39
  Speaker 8: for them, forty fifty percent in this recent quarter. And
• 19:43
  Speaker 8: obviously there's a couple of other companies that are in
• 19:45
  Speaker 8: this area as well, so it's a competitive area as well,
• 19:47
  Speaker 8: with a firm which is another company went public perhaps
• 19:49
  Speaker 8: about five years ago.
• 19:51
  Speaker 3: That was Anthony Hughes, Bloomberg Equity Capital Markets Reporter.
• 19:54
  Speaker 2: We moved to some news in the biotech space this week.
• 19:57
  Speaker 3: We heard that the Danish drug maker Novo Nordesk will
• 19:59
  Speaker 3: be further lowering the prices of its obesity drugs for
• 20:02
  Speaker 3: cash paying patients.
• 20:03
  Speaker 2: It's in an effort to call back a larger share
• 20:05
  Speaker 2: of the US market from arch rival Eli Lilly. Nova
• 20:08
  Speaker 2: said introductory doses of its blockbuster drugs we Govi and
• 20:11
  Speaker 2: ozembic will be available for one hundred and ninety nine
• 20:14
  Speaker 2: dollars a month.
• 20:15
  Speaker 3: That price applies to the first two months of treatment.
• 20:17
  Speaker 3: After that, Nova will offer the drugs through its Novocare
• 20:20
  Speaker 3: direct to consumer portal for three hundred and forty nine
• 20:22
  Speaker 3: dollars a month, that is thirty percent less than the
• 20:25
  Speaker 3: current self pay price.
• 20:26
  Speaker 2: For more, we were joined by Michael Shaw, Bloomberg Intelligence
• 20:29
  Speaker 2: Senior pharma biotech analyst. Well first asked Michael to break
• 20:32
  Speaker 2: down what exactly Nova nord Disk is doing.
• 20:35
  Speaker 9: And this is obviously ahead of the White House tales.
• 20:36
  Speaker 9: So you're seeing starting dice is being reduced two hundred
• 20:39
  Speaker 9: dollars per month and then doses thereafter being charged at
• 20:43
  Speaker 9: an average of three hundred and fifty dollars per month
• 20:45
  Speaker 9: compared to five hundred dollars previously. So, I mean, you know,
• 20:49
  Speaker 9: those prices kind of align to, you know, the pricing
• 20:52
  Speaker 9: in the White House statement coming from Trump RX, but
• 20:56
  Speaker 9: compared to Lily, I mean they're under cutting them by
• 20:59
  Speaker 9: about you know, hundred dollars at each dose. And this
• 21:02
  Speaker 9: is basically a ployed to basically compete for new patient starts.
• 21:06
  Speaker 9: As we know, Lee's got the more effective product in
• 21:09
  Speaker 9: terms of weight loss profile, and they're also you know,
• 21:13
  Speaker 9: executing better on the launchers. And I think that's clear
• 21:15
  Speaker 9: from three Q results where we saw contrasting fortunes between
• 21:19
  Speaker 9: those two particular drug makers.
• 21:20
  Speaker 2: Mikey, give us a sense of this marketplace here, what
• 21:23
  Speaker 2: percentage of the addressable market is actually taking these obesity
• 21:28
  Speaker 2: drugs versus because it seems like as the price comes down,
• 21:31
  Speaker 2: more and more people will be able to get access
• 21:33
  Speaker 2: to them.
• 21:34
  Speaker 9: Yeah. Absolutely, I mean it's a highly priced sensitive market.
• 21:37
  Speaker 9: When we look at penetration rates in the US, you know,
• 21:39
  Speaker 9: low single digits, that's obviously going to accelerate as these
• 21:43
  Speaker 9: drugs become cheaper. Looking outside the US, penetration rates are
• 21:48
  Speaker 9: even lower, So there's you know, still significant kind of
• 21:52
  Speaker 9: you know patient runway out there in terms of US penetration.
• 21:56
  Speaker 9: I mean, the White House pricing deal on GLP one drugs,
• 21:59
  Speaker 9: you know, supports kind of use of these these GLP
• 22:03
  Speaker 9: one drugs in medicare you know there we think that
• 22:06
  Speaker 9: it can unlock you know, seven to eight million patients
• 22:10
  Speaker 9: according to a White House statement. I think they said
• 22:12
  Speaker 9: ten percent of Medicare beneficiaries would become eligible for GP
• 22:16
  Speaker 9: one drugs based on the pilot program, and that's going
• 22:19
  Speaker 9: to be introduced in twenty six, and I think it's
• 22:21
  Speaker 9: going to become mandatory in twenty seven. And then they've
• 22:24
  Speaker 9: also you know, loaded the price in Medicaid too. I
• 22:28
  Speaker 9: think the uplift in terms of patients there is a
• 22:30
  Speaker 9: bit harder to deduce or to kind of model, given
• 22:34
  Speaker 9: that you know, coverage is going to be on a
• 22:36
  Speaker 9: state by state basis, and there's also kind of different
• 22:38
  Speaker 9: qualifying criteria, which again is state dependent.
• 22:42
  Speaker 3: What does this mean, Michael? For the companies like Hymns
• 22:45
  Speaker 3: and Hers, the companies that make compounded copycat versions of
• 22:49
  Speaker 3: these anti obesity drugs, they've done very well. And I
• 22:52
  Speaker 3: know those stock for Hymns and Hers has been kind
• 22:54
  Speaker 3: of all over the place, but it is modestly higher
• 22:56
  Speaker 3: from where it was at the start of the year.
• 22:58
  Speaker 9: Yeah, I mean I think that whole well, you know,
• 23:00
  Speaker 9: the compounding situation. I believe that you know, one point
• 23:03
  Speaker 9: two million patients from compounding GLP one at the moment.
• 23:07
  Speaker 9: That's based on kind of comments and Novo made during
• 23:09
  Speaker 9: their three key results obviously loaning down the price. Would
• 23:13
  Speaker 9: kind of of the branded treatments would basically well, I
• 23:18
  Speaker 9: mean it would it would you know, lessen the delta
• 23:20
  Speaker 9: between you know, coffycats and branded treatment. So I guess
• 23:24
  Speaker 9: it's a negative for for for these you know, compounded
• 23:28
  Speaker 9: GLP one drug makers.
• 23:29
  Speaker 4: Mikey.
• 23:30
  Speaker 2: When I look at the big cap farm of names,
• 23:32
  Speaker 2: is it as simple as I want to own the
• 23:35
  Speaker 2: ones with exposure to obesity market and not own the
• 23:38
  Speaker 2: ones that don't. Because I'm looking at your your slate
• 23:40
  Speaker 2: of stocks and you either up thirty percent or you're down.
• 23:44
  Speaker 9: Yeah, I mean I think you know, there's a there's
• 23:46
  Speaker 9: a few large farmer names which which has entered the space.
• 23:50
  Speaker 9: You know, in the in the recent years you've seen
• 23:53
  Speaker 9: kind of deals with Ross and Zealand for an Amlin drug.
• 23:56
  Speaker 9: Most recently you've obviously got the fires and met Sarah
• 24:00
  Speaker 9: an a deal. I mean, I think obesity is obviously
• 24:03
  Speaker 9: appealing given you know the size of the target population,
• 24:06
  Speaker 9: how underpenetrated it currently is, and you know, if you're
• 24:09
  Speaker 9: looking to you know, offset patent expirations later in the decade,
• 24:14
  Speaker 9: you know there's an abundance of of kind of Jill
• 24:17
  Speaker 9: point on products out there as well as other assets too.
• 24:20
  Speaker 9: So I think that's the appeal of the space. It's
• 24:22
  Speaker 9: a large market, it's underpenetrated, and there's high demand for
• 24:25
  Speaker 9: these treatments too.
• 24:27
  Speaker 3: I mentioned M and A, And of course we know
• 24:28
  Speaker 3: that JANJ is making a purchase to increase its pipeline
• 24:33
  Speaker 3: to get away from relying on these older drugs that
• 24:35
  Speaker 3: have lost patent protection. Is every farmer company doing the
• 24:39
  Speaker 3: same thing. Is that you know they're not only strategy,
• 24:42
  Speaker 3: but is that the way they move forward? Is there
• 24:45
  Speaker 3: anyone who's kind of like in a good position and
• 24:47
  Speaker 3: doesn't need to make a deal.
• 24:49
  Speaker 9: I mean, I think that's always been part of the
• 24:50
  Speaker 9: large farmer model. They supplement kind of in house innovation
• 24:54
  Speaker 9: with extern of innovation, particularly if they want to get
• 24:57
  Speaker 9: into areas perhaps outside of their cool competency. But I mean,
• 25:02
  Speaker 9: I think that's just that the model in general. Biotechs
• 25:05
  Speaker 9: always been the pipeline for large farmer companies, or at
• 25:08
  Speaker 9: least help Bell cault that pipeline.
• 25:11
  Speaker 3: Our thanks to Michael shop Bloomberg Intelligence senior pharma biotech
• 25:14
  Speaker 3: analyst coming up a look at why the global sports
• 25:17
  Speaker 3: company a Maorsports raised it's full your guidance.
• 25:19
  Speaker 2: You're listening to Bloomberg Intelligence on Bloomberg Radio, providing in
• 25:22
  Speaker 2: depth research and data on two thousand companies and one
• 25:24
  Speaker 2: hundred and thirty industries.
• 25:25
  Speaker 3: You can access Bloomberg Intelligence through Bigo on the terminal.
• 25:28
  Speaker 3: I'm Scarlett Foe.
• 25:29
  Speaker 2: And I'm Paul Sweeney, and this is Bloomberg.
• 25:39
  Speaker 1: This is Bloomberg Intelligence with Scarlett Foo and Paul Sweeney
• 25:44
  Speaker 1: on Bloomberg Radio.
• 25:46
  Speaker 2: We move next to earnings from the department store TJX.
• 25:49
  Speaker 3: The off price retailer reported third quarter sales that beat
• 25:51
  Speaker 3: analyst estimates. It also raised its guidance for comparable sales
• 25:55
  Speaker 3: this year.
• 25:55
  Speaker 2: It's a sign that your shoppers are turning to cheaper
• 25:58
  Speaker 2: options as economy shows signs of d for more. We
• 26:01
  Speaker 2: were joined by Mary Ross, Gilbert, Bloomberg Intelligence Senior Equity Analyst.
• 26:04
  Speaker 3: We began by asking Mary for her take on this
• 26:06
  Speaker 3: week's results and whether she is a fan of TJX.
• 26:09
  Speaker 10: I'm a fan too, and they it's because they carry
• 26:12
  Speaker 10: such a variety of brands and it appeals to all
• 26:15
  Speaker 10: income groups. So if you have a luxury consumer, you
• 26:19
  Speaker 10: can get Balanciaga you can get Chloe low. So they
• 26:24
  Speaker 10: carry all of the brands. And then if you're more
• 26:27
  Speaker 10: oppressed and you're really a valued consumer, they have Steve Madden,
• 26:31
  Speaker 10: they have Theory, so they really they have Puma, they
• 26:35
  Speaker 10: have Nike, Adidas, so they have all the brands that
• 26:40
  Speaker 10: consumer want and that's why they're Marmax, which is tj
• 26:44
  Speaker 10: max and Marshall's division, reported a comp sales increase of
• 26:48
  Speaker 10: six percent, and that's why. You know, if you look
• 26:51
  Speaker 10: at the overall results, they were up five percent, so
• 26:53
  Speaker 10: a lot of strength there within the Marmas home goods
• 26:56
  Speaker 10: and of course Canada. Canada was up eight So we're
• 27:01
  Speaker 10: seeing consumers flock to get the brands that they want
• 27:06
  Speaker 10: and they've had some amazing buying opportunities, so their margins
• 27:10
  Speaker 10: were higher.
• 27:11
  Speaker 3: So the way that TJX stocks at stores is that
• 27:16
  Speaker 3: they get inventory that hasn't sold at full price stores.
• 27:19
  Speaker 3: But if all these merchants, all these retailers are managing
• 27:23
  Speaker 3: their inventories better and don't have a lot of excess inventory,
• 27:26
  Speaker 3: where does tj X get its inventory. I mean it
• 27:29
  Speaker 3: has to have another option, right.
• 27:32
  Speaker 10: Yeah, Scarlett, you raise a good question, But the fact
• 27:35
  Speaker 10: is is that some of the retailers, but also the
• 27:38
  Speaker 10: brands themselves. So if you think of for example, PVH,
• 27:42
  Speaker 10: which has the Tommy Hill Figure and Calvin Klein brands,
• 27:46
  Speaker 10: we see those brands pretty prevalent throughout off price. So
• 27:49
  Speaker 10: that's been a good channel for them to sort of
• 27:53
  Speaker 10: release some of that excess inventory, and when they work
• 27:55
  Speaker 10: with some of their wholesale partners, including the department stores,
• 27:59
  Speaker 10: So were you have product that's not selling off price
• 28:03
  Speaker 10: is just a natural fit to be able to release
• 28:07
  Speaker 10: that inventory. So you want to keep your inventory fresh
• 28:10
  Speaker 10: in the stores, especially when you're a full price operator,
• 28:13
  Speaker 10: and there hasn't been any slow down in terms of
• 28:16
  Speaker 10: that excess inventory. And that's why even on the luxury side,
• 28:20
  Speaker 10: where typically you wouldn't think you'd find markdowns, it's been
• 28:25
  Speaker 10: pretty prevalent, especially with overall weakness and luxury.
• 28:30
  Speaker 2: So what does the folks at Cheak, TJ Max, what
• 28:32
  Speaker 2: are they saying about the consumer these days?
• 28:36
  Speaker 10: Well, the consumer, I mean they're really seeing strength. So
• 28:39
  Speaker 10: it's interesting because when you sort of read the take
• 28:42
  Speaker 10: on Target with their results and they sort of cited
• 28:45
  Speaker 10: you know, the consumer is very cautious, but that caution
• 28:48
  Speaker 10: I think what's really going on is that they've got
• 28:51
  Speaker 10: the brands that consumers want. So those that are executing
• 28:55
  Speaker 10: are the ones that are getting the sales, because even
• 28:57
  Speaker 10: some retailers that are more full price oriented are generating
• 29:02
  Speaker 10: sales or they may be promotional, so the consumer is
• 29:05
  Speaker 10: flocking to value, There's no doubt about it. But we
• 29:08
  Speaker 10: do see some you know operators. You've got Ralph Lauren
• 29:11
  Speaker 10: on the luxury side. They continue to outperform and their
• 29:14
  Speaker 10: sales are always topping expectations too. And consumers there are
• 29:19
  Speaker 10: willing to pay full price, so there are a lot
• 29:22
  Speaker 10: less promotional every year. They seem to be less promotional
• 29:27
  Speaker 10: for that reason, they're able to sell at full price.
• 29:29
  Speaker 3: So clearly TJX has a strategy that works well given
• 29:33
  Speaker 3: the current environment, and even when the economy is doing well,
• 29:36
  Speaker 3: I would argue it has a strategy that works well.
• 29:38
  Speaker 3: At what point do investors want more from the company
• 29:41
  Speaker 3: than just executing on the strategy? Well, they want I
• 29:45
  Speaker 3: don't know, am an age or do they want consolidation?
• 29:48
  Speaker 3: Do they want innovation from TJX?
• 29:51
  Speaker 10: Yeah, Well, so that's the reason why TGX is focused,
• 29:55
  Speaker 10: you know, internationally, so they're going to be entering Spain
• 29:58
  Speaker 10: in twenty twenty six, so coming next year. And of
• 30:01
  Speaker 10: course they've had some They have two joint venture investments,
• 30:06
  Speaker 10: one in Mexico and then one in the Middle East,
• 30:09
  Speaker 10: and they're both off price retailers that they've invested in,
• 30:12
  Speaker 10: So they're basically taking their talent and providing them a
• 30:16
  Speaker 10: platform to leverage their talent in these joint ventures and
• 30:19
  Speaker 10: to grow that way. So they're always looking for ways.
• 30:22
  Speaker 10: Because Scarlett, you bring up a good point. TJX trades
• 30:26
  Speaker 10: at a pretty high premium in the off price space,
• 30:29
  Speaker 10: and generally it's a pretty big premium that is due
• 30:32
  Speaker 10: to their very consistent execution. But you're right, consumers keep wondering, well,
• 30:37
  Speaker 10: how can they keep growing on top of all this growth,
• 30:41
  Speaker 10: and yet they keep doing it. But as they talk about, look,
• 30:45
  Speaker 10: they have drops several times a week. There's not a
• 30:48
  Speaker 10: lot of retailers that offer fresh merchandise several times a week,
• 30:51
  Speaker 10: and they curate the merchandise by location, so they're very
• 30:55
  Speaker 10: cognizant of the demographics for each location.
• 30:59
  Speaker 2: Thanks to Mary Ross Gilt at Bloomberg Intelligence, senior ecody analysts.
• 31:02
  Speaker 3: We moved next to news from the Global sports company
• 31:04
  Speaker 3: a mere Sports.
• 31:05
  Speaker 2: This week, the company raised it's for your guidance for
• 31:07
  Speaker 2: the third time this year. That's after a strong demand
• 31:10
  Speaker 2: for its Solomon footwear drove quarterly sales to a record.
• 31:13
  Speaker 3: Sales growth at the group's other two units, including the
• 31:16
  Speaker 3: technical apparel segment and the ball and Racket sports unit,
• 31:19
  Speaker 3: also surpassed estimates, and overall group sales they hit a
• 31:22
  Speaker 3: new high.
• 31:22
  Speaker 2: For more, we were joined by Abigail gil Martin Bloomberg
• 31:25
  Speaker 2: Intelligence at leisure and footwear analysts on amer sports earnings,
• 31:29
  Speaker 2: the first to as Abigail to break down amer sports
• 31:32
  Speaker 2: most recent earnings report.
• 31:33
  Speaker 11: They did really well, you know, sales up thirty percent,
• 31:36
  Speaker 11: broad based strength across regions, across channels, and across brands.
• 31:41
  Speaker 11: I think the key thing people are looking for was China.
• 31:44
  Speaker 11: Arctics recently had some controversy in China with fireworks display
• 31:49
  Speaker 11: in the Himalayas that what fireworks display.
• 31:53
  Speaker 2: Displayed fireworks in the Himalayans.
• 31:55
  Speaker 11: Arctics for set off fireworks exactly. It was definitely a
• 32:02
  Speaker 11: misstep for an outdoor brand that's really focused on sustainability,
• 32:05
  Speaker 11: and there was definitely some concern that there would be
• 32:07
  Speaker 11: a little backlash in China. There's definitely a lot of
• 32:10
  Speaker 11: people upset about it, and they were fined by the
• 32:13
  Speaker 11: Chinese government and working to restore the ecology there. But
• 32:17
  Speaker 11: Greater China was up forty seven percent, momentum is continuing
• 32:20
  Speaker 11: into four Q so I think that was really a
• 32:23
  Speaker 11: big takeaway, just quelling investors' concerns about potential backlash in China,
• 32:28
  Speaker 11: especially because they're the number one outdoor sports brand in China.
• 32:32
  Speaker 3: Arctereric So, I had no idea that they have such
• 32:35
  Speaker 3: strong brands. I mean, a Mare Sports on its own
• 32:38
  Speaker 3: is kind of it doesn't it's not memorable the name,
• 32:41
  Speaker 3: the parent company name, right, but the brands of course
• 32:43
  Speaker 3: are Solomon, Arctic, so Wilson. As you mentioned, what does
• 32:46
  Speaker 3: the tariff picture look like for this company.
• 32:49
  Speaker 11: Yeah, I think it's very similar to most of the
• 32:51
  Speaker 11: other companies. I think for them, what benefits them as
• 32:55
  Speaker 11: their premium positioning. They're able to raise prices and they're
• 32:59
  Speaker 11: not seeing any from consumers or pullback. They're still seeing
• 33:03
  Speaker 11: very strong full price sell through, so they're able to
• 33:06
  Speaker 11: offset some of those tariff costs with that, which I
• 33:09
  Speaker 11: think is really helping. And we're seeing that with a
• 33:11
  Speaker 11: lot of more of the premium brands are able to
• 33:13
  Speaker 11: kind of navigate through the tariffs since their consumers are
• 33:16
  Speaker 11: willing to pay upper KU, upper.
• 33:18
  Speaker 3: K of the K shaped economy.
• 33:20
  Speaker 2: I guess I know that's I guess where you want
• 33:22
  Speaker 2: to be there. Talk to us about the footwear market here.
• 33:26
  Speaker 2: I think you know, Nike, Adidas, all that kind of stuff.
• 33:29
  Speaker 2: What's going on there?
• 33:30
  Speaker 11: Yeah, I think you know, we're in store for a
• 33:33
  Speaker 11: very interesting holiday season. I think that we're going to
• 33:36
  Speaker 11: continue to see the premium brands continue to do well
• 33:39
  Speaker 11: on holdings. Recently just reported and did phenomenal, and they
• 33:42
  Speaker 11: also said they're not seeing any backlash on raised prices
• 33:46
  Speaker 11: and they'll continue to do you know, limited discounting through
• 33:49
  Speaker 11: the holidays. So we may see some differences between the
• 33:52
  Speaker 11: two companies, but we just had our recent BI survey
• 33:56
  Speaker 11: and Nike continues to let I think there's been concerns overnight,
• 34:00
  Speaker 11: but they still are the major shareholder and still a
• 34:03
  Speaker 11: favorite brand of millennials. Gen Z's everyone for the holidays,
• 34:06
  Speaker 11: so they should continue to do well too.
• 34:08
  Speaker 3: What is the maorsports distribution strategy? Do they have a
• 34:11
  Speaker 3: DTC offering or are they going through third party retailers.
• 34:15
  Speaker 11: Yeah, that's a great question. So it's a little different
• 34:17
  Speaker 11: for each brand. For Arctics, they're leaning a lot more
• 34:21
  Speaker 11: into DTC. They've changed their distribution strategy from basically nine
• 34:25
  Speaker 11: eighty percent wholesale to eighty percent DTC over the last
• 34:28
  Speaker 11: three years, and they're really focusing on growing their store
• 34:32
  Speaker 11: base because I think not a lot of people know
• 34:34
  Speaker 11: about Arctics. It's really going to help the brand awareness.
• 34:37
  Speaker 11: So even in the US, they're looking to double their
• 34:39
  Speaker 11: store account by twenty thirty so that through Solomon continues
• 34:44
  Speaker 11: to be wholesale, especially for footwear, we're seeing this holiday
• 34:48
  Speaker 11: season consumers strap for cash.
• 34:51
  Speaker 5: They're wanting to.
• 34:52
  Speaker 11: Go into the stores and try on their shoes and
• 34:54
  Speaker 11: make sure it's the right fit and buy them versus
• 34:56
  Speaker 11: you know, buy five pairs and return them. Yeah, so
• 35:00
  Speaker 11: the wholesale distribution for Solomon and is really key, and
• 35:02
  Speaker 11: they're in a lot of key premium partners, I would say,
• 35:06
  Speaker 11: and you know the running specialty stores as well.
• 35:09
  Speaker 2: I mean, I'm looking at your report here research your
• 35:11
  Speaker 2: reportal on the sneaker business. I didn't know there were
• 35:14
  Speaker 2: so many shoe manufacturers. I mean, Nike's the dominant one,
• 35:17
  Speaker 2: as you said, but there's like fourteen in your survey here. Yeah, yeah, No,
• 35:21
  Speaker 2: that's a competitive marketplace.
• 35:23
  Speaker 11: Definitely, it's getting even more competitive as consumers with AI technology,
• 35:28
  Speaker 11: you know, there's just such more of a breath of discovery.
• 35:32
  Speaker 11: So that's where product is really coming into play this
• 35:35
  Speaker 11: holiday season. I think, you know, the innovation, product and style.
• 35:40
  Speaker 3: If there's one thing to be worried about when it
• 35:42
  Speaker 3: comes to amre sports, what would it be? I mean,
• 35:44
  Speaker 3: what's an area that they're not executing on?
• 35:48
  Speaker 11: So I think the China thing was the one uncertainty
• 35:52
  Speaker 11: for this quarter that we were Definitely it could have
• 35:54
  Speaker 11: gone either way, so that would be the biggest thing.
• 35:57
  Speaker 11: But honestly, they're executing on most of their things as
• 36:00
  Speaker 11: drivers are, DTC, Women's and China and all of those
• 36:04
  Speaker 11: were up double digits and more. And they're really gaining
• 36:07
  Speaker 11: share in women's which I think is a big new
• 36:09
  Speaker 11: opportunity for them as more women joined the outdoor market.
• 36:12
  Speaker 2: All right, which have you purchased in the last twelve months?
• 36:16
  Speaker 2: Sneaker brands for baby boomers? Sketchers?
• 36:20
  Speaker 7: Yeah?
• 36:20
  Speaker 2: What what Sketches continues to win?
• 36:24
  Speaker 5: It is Honestly, they're.
• 36:26
  Speaker 11: So comfortable, they're like the price point, the quality. I know,
• 36:30
  Speaker 11: I know, I know, I know, but.
• 36:33
  Speaker 3: This is not something that they market out there, that
• 36:35
  Speaker 3: they put out there.
• 36:36
  Speaker 11: No, and they're the third largest footwear brand globally. Really, yeah,
• 36:40
  Speaker 11: I think right behind Adidas.
• 36:42
  Speaker 3: Next, you're going to tell me that, you know, the
• 36:43
  Speaker 3: boomers are using the shoes with the little wheel in
• 36:46
  Speaker 3: the back of.
• 36:46
  Speaker 2: The No, the wheelers, the wheels.
• 36:48
  Speaker 5: Yeah, No, they're doing the step ins.
• 36:50
  Speaker 11: You don't even have to bend down exact it.
• 36:53
  Speaker 2: That's what I think it is. I think you're right,
• 36:55
  Speaker 2: all right, Yeah, there you go. I mean the kids,
• 36:57
  Speaker 2: the gen z, the millennials, they're still in that Nike.
• 36:59
  Speaker 2: You yet, brands still audience.
• 37:02
  Speaker 11: Or Hokahs, yeah, ka Hoka and on are gaining, but
• 37:06
  Speaker 11: they're you know, they're still small, and I think people
• 37:08
  Speaker 11: don't realize that just because there's been such a big boom,
• 37:11
  Speaker 11: they're still very like West Coast East Coast oriented, you know,
• 37:15
  Speaker 11: they still have a lot more room to grow brand
• 37:16
  Speaker 11: awareness in the US, especially in the middle of America.
• 37:20
  Speaker 3: That was Abigail Gilbart and Bloomberg Intelligence at Leisure and
• 37:22
  Speaker 3: Footwear Analysts.
• 37:24
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• 37:29
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• 37:30
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