Latest / What the Flux / Virgin Australia's back in black | IKEA's first sales drop in years | Adobe enters the AI race

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Virgin Australia's back in black | IKEA's first sales drop in years | Adobe enters the AI race · What the Flux

• 0:05
  Speaker 1: This is lot of Flux.
• 0:06
  Speaker 2: I'm Brett and Justin As Wednesday, the sixteenth of October,
• 0:10
  Speaker 2: Johnsie Boy, we spoke the other day about the XBS
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  Speaker 2: and payment terminals when you tap your card. Now the
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  Speaker 2: federal government is getting ready to outlaw debit cards surcharges.
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  Speaker 2: That means you pay for your five dollars twenty coffee
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  Speaker 2: with a debit card and you should be charged five
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  Speaker 2: dollars twenty None of these five dollars and thirty six cents,
• 0:26
  Speaker 2: mumbo jumbo.
• 0:27
  Speaker 1: I never get that random number. So on Fox fam.
• 0:30
  Speaker 1: As we hit the middle of October, there are only
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  Speaker 1: two more weeks until the cutoff to submit your tax
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  Speaker 1: return via Miga, and if you don't submit it for
• 0:38
  Speaker 1: the end of October, you could be facing fines up
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  Speaker 1: to fifteen hundred bukaroonies. Thankfully, in the Flux app, we've
• 0:43
  Speaker 1: got it all covered, all the steps you need to
• 0:45
  Speaker 1: take if you want to submit your tax return, so
• 0:47
  Speaker 1: make sure to check it out.
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  Speaker 2: Three truly inspiring stories today, Jusy boy, let's do it
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  Speaker 2: for our first. Virgin Australia has seen its earnings jump
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  Speaker 2: by eighteen percent after it recorded its second profit in
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  Speaker 2: a row.
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  Speaker 1: After a decad being in the Red b Man, these
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  Speaker 1: profits must feel extra sweet for Virgin right now, so
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  Speaker 1: tell me more.
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  Speaker 2: Well, Jessie Boy, We've spoken about Virgin Australia a fair
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  Speaker 2: bit in the past twelve months. Most recently though, Qatar
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  Speaker 2: Airways acquired a twenty five percent stake of Virgin Australia,
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  Speaker 2: which is still subject to regulatory approval by the Bye
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  Speaker 2: the BEMN. After years of loss making and even going
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  Speaker 2: into voluntary administration under previous ownership, Virgin Australia has now
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  Speaker 2: announced a big profit. Yeah, we're talking earnings of five
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  Speaker 2: hundred and nineteen million bucks for the past financial year,
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  Speaker 2: which is an eighteen percent jump on last year.
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  Speaker 1: And be man, Virgin Australia has a pretty fat grin
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  Speaker 1: on his face right now because it's rival Quantus actually
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  Speaker 1: saw its earnings drop by seventeen percent.
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  Speaker 2: Big big turnaround from the Big V after pretty much
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  Speaker 2: shutting up shop in twenty twenty.
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  Speaker 1: In the last financial year it flew more than nineteen
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  Speaker 1: point two million passengers, and.
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  Speaker 2: Josie Boy, Virgin Australia is planning to ramp up the
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  Speaker 2: pressure on Quantas even more if the Qatar Airways investment is.
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  Speaker 1: Approved, particularly if it uses the wet leases.
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  Speaker 2: And it's fair to say we need a bit of
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  Speaker 2: competition in the airline market, both domestic and international.
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  Speaker 1: So what is the key learning here?
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  Speaker 2: Strategic investments can transform an airlines balance sheet from red
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  Speaker 2: to black.
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  Speaker 1: You see, be Man. While Virgin Australia has already performed
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  Speaker 1: strongly over the last couple of years, it now has
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  Speaker 1: the ability to leverage Qatar Airways through wet leases. Here's
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  Speaker 1: how it works.
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  Speaker 2: One airline in this case Virgin sells seats on the
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  Speaker 2: flights operated by another carrier.
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  Speaker 1: In this case Qatar Airways, but jes Wait.
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  Speaker 2: While it's sold as a Virgin flight, Qatar would use
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  Speaker 2: its own aircraft and its own crew and be Man.
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  Speaker 1: This works for Qatar Airways, who has capacity with a
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  Speaker 1: heap of planes.
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  Speaker 2: And it works for Virgin Australia, who can sell more
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  Speaker 2: flights than it currently offers. And if Qatar's investment is approved,
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  Speaker 2: it could lead to twenty eight new flights a week
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  Speaker 2: to Doha from Sydney, Melbourne, Brisbane and Perth, as.
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  Speaker 1: Well as potentially competing on other flights to London and
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  Speaker 1: Paris Rome Dallas.
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  Speaker 2: Which quantus has no competition for right now.
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  Speaker 1: For our second story, Ikea has dropped prices globally to
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  Speaker 1: attract more shoppers after its first revenue drop in four years.
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  Speaker 2: The masters of the Allen key have finally hit a snag.
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  Speaker 2: Tell me more so, be man. Ikea is the.
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  Speaker 1: Build it yourself furniture store started in Sweden back in
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  Speaker 1: nineteen forty three.
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  Speaker 2: The names of its products are nearly as complicated as
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  Speaker 2: the assembly of its products.
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  Speaker 1: But then, man, you've got to hand it to them.
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  Speaker 1: These flash pack makers just keep growing and growing and growing.
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  Speaker 2: Until their last financial year.
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  Speaker 1: Yeah, Ikea has announced sales of thirty nine point six
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  Speaker 1: billion euros globally for the last financial year to August.
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  Speaker 2: And that's a five point three percent decline in revenue
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  Speaker 2: compared to last year.
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  Speaker 1: And what was the reason for this drop? Bman, well
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  Speaker 1: does it boy?
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  Speaker 2: The CEO said that they experienced a slow down of
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  Speaker 2: the home furnishing industry in all markets at the very
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  Speaker 2: same time.
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  Speaker 1: And he reckons they haven't experienced anything like it since
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  Speaker 1: two thousand and.
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  Speaker 2: Eight ahem, ahem, the global financial crisis.
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  Speaker 1: And after they saw a decline in store visit, Ikea
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  Speaker 1: pulled the old strategic price cuts move to boost sales
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  Speaker 1: through its Amaze like stores and does boy.
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  Speaker 2: Ike has announced it's likely to drop even more price
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  Speaker 2: cuts in the coming year.
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  Speaker 1: Because it's raw material costs have dropped as well as
• 4:01
  Speaker 1: those pesky softer economic condition So what is the key
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  Speaker 1: learning here? In an era of rising costs, cutting prices
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  Speaker 1: is a bold move that actually defies the market norms.
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  Speaker 2: Well, we know that global inflation hit about eight point
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  Speaker 2: seven percent in twenty twenty two. In twenty twenty three,
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  Speaker 2: it was still over six and a half percent, and
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  Speaker 2: most retailers have used inflation as the perfect excuse to
• 4:22
  Speaker 2: jack up prices. Looking at you, Coles and Wooally, the
• 4:25
  Speaker 2: jazibait Ikea has taken an unconventional route by reducing prices
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  Speaker 2: despite these external pressures that they've got.
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  Speaker 1: Yeah. The idea for Ikia is that if it can
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  Speaker 1: cut its costs while competitors are increasing, it can appeal
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  Speaker 1: to budget conscious consumers.
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  Speaker 2: It may help them play the long game by focusing
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  Speaker 2: on building market chap rather than short term revenue and profits.
• 4:43
  Speaker 1: For our third and final story, Adobe has joined the
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  Speaker 1: AI race after launching an AI video generator that will
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  Speaker 1: see compete with the tech giants.
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  Speaker 2: Adobe pulling out the biggest gun they've got. I want
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  Speaker 2: to know, Jazi Way, what or what is going on here?
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  Speaker 2: Adobe is the American design software co. It started in
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  Speaker 2: nineteen eighty two. It's probably best known for Photoshop or
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  Speaker 2: Adobe Illustrated products, which have been the bread and butter
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  Speaker 2: for designers for many many years.
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  Speaker 1: Now be Man. Over the last few years, Adobe has
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  Speaker 1: been facing some pretty tough competition from the likes of
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  Speaker 1: Camber and Microsoft, who have entered and made a big
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  Speaker 1: splash in the design market.
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  Speaker 2: And it's also been getting heat from big tech companies
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  Speaker 2: like OpenAI and Google who are stepping into the design
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  Speaker 2: market with their AI tools.
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  Speaker 1: But now b Man, Adobe has come out with its
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  Speaker 1: own version of AI.
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  Speaker 2: Yep, they've released a new AI video generator tool to
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  Speaker 2: help create and edit videos from text prompts.
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  Speaker 1: For example, you could enter a prompt like create a
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  Speaker 1: poker game on the Sydney Harbor.
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  Speaker 2: Bridge and basically it allows you to choose everything from
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  Speaker 2: the look of the people, the camera angles, the motions,
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  Speaker 2: the zoom in.
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  Speaker 1: Or out and interestingly, be Man its models have been
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  Speaker 1: trained mostly on its own library of squillions of stock
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  Speaker 1: videos and images.
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  Speaker 2: What a marvelous observation, Jesse Voice. I'm wondering what is
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  Speaker 2: the key learning here In the race to dominate the
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  Speaker 2: AI industry? Owning your own content can be a major
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  Speaker 2: compared advantage.
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  Speaker 1: Is the thing.
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  Speaker 2: Adobe is our big, big dog, but also pretty small
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  Speaker 2: player in the AI industry compared to tech giants like
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  Speaker 2: Meta or like Google.
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  Speaker 1: But unlike those big dogs, Adobe owns a massive library
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  Speaker 1: of photo and video data that it can train its
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  Speaker 1: AI models on.
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  Speaker 2: Which means it doesn't need to negotiate expensive licensing deals
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  Speaker 2: to legally access content that trains its models.
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  Speaker 1: Yeah, we've already seen open Ai negotiate licensing deals with
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  Speaker 1: media and content companies like News Corp. And Reddit, Financial Times,
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  Speaker 1: Shutterstock and more so does it Boy?
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  Speaker 2: Well, some tech companies have to show out millions to
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  Speaker 2: access content. Adobe can train its models on its own content, so.
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  Speaker 1: There's less barriers in Adobe's way to launch its AI
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  Speaker 1: products and maybe even get ahead in the market. Yeah,
• 6:41
  Speaker 1: Fox amm two more weeks to do the dreaded tax returns,
• 6:44
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• 6:46
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• 6:48
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• 6:50
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• 6:52
  Speaker 2: Thanks for listening, and we'll see you on Friday.