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Disney Taps Parks Chief Josh D’Amaro to Succeed Iger as CEO · Bloomberg Intelligence

• 0:02
  Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
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  Speaker 1: or watch us live on YouTube.
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  Speaker 2: Walt Disney saying that Josh Tomorrow will succeed Bob Iger
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  Speaker 2: as CEO of the company. This ends a three year
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  Speaker 2: search to replace its long serving leader, who had to
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  Speaker 2: come back after the first time around didn't quite work out.
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  Speaker 3: Let's bring in Githa Ranganathen.
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  Speaker 2: She is our US media analyst here at Bloomberg Intelligence.
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  Speaker 2: And I want to contrast what happened this time around
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  Speaker 2: with the succession planning Githa, with what happened in the
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  Speaker 2: past when Bob Chapek, also of the Parks division, was
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  Speaker 2: named CEO but didn't last too long on the job.
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  Speaker 2: Can you compare and contrast the different succession efforts.
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  Speaker 4: Yeah, I think it was a very different time Scarlet.
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  Speaker 4: So remember he was appointed in February of twenty twenty.
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  Speaker 4: March twenty twenty, everything closes down, including you know, Disney
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  Speaker 4: Parks because of the pandemic. So it was kind of unfortunate.
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  Speaker 4: The timing was all wrong, I would say for Bob Chapek.
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  Speaker 4: And what happened then is, of course, you know, movies
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  Speaker 4: were shut down a big part of Disney's business, movies
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  Speaker 4: as well as the parks again. But then what really
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  Speaker 4: kind of shot into prominence at that point was the
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  Speaker 4: streaming business, a business that Bob Chapik was not really
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  Speaker 4: very familiar with, and while he did have some experience
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  Speaker 4: in content, obviously it was not enough. And we had
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  Speaker 4: a whole bunch of different missteps with the content part
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  Speaker 4: of the business, which kind of led to the whole
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  Speaker 4: you know mess that we saw, you know follow I
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  Speaker 4: think this time we were in a very very different position.
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  Speaker 4: I think at that point Disney was still kind of
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  Speaker 4: trying to figure out what it really was. Was it
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  Speaker 4: a TV company, was it a studio, was it a
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  Speaker 4: theme park company? Or was it really a streaming player?
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  Speaker 4: And I think now the pieces have kind of fallen
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  Speaker 4: in place. We are on much more steady ground. I
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  Speaker 4: would say, you know, they have their clear mandates, whether
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  Speaker 4: it isn't streaming, whether it's in studio, you know, the
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  Speaker 4: clear what has really emerged clearly right now Scarlett is
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  Speaker 4: that parks is the main core growth engine of the company,
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  Speaker 4: and I think that is reflected in this choice today
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  Speaker 4: with Josh Tomorrow.
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  Speaker 5: So Keithan.
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  Speaker 6: Josh is a twenty eight year veteran of Disney running
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  Speaker 6: the parks. But of course the other big part of
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  Speaker 6: the company is it's you know, entertainment business. Dana Walden
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  Speaker 6: who runs the big part of that business, great reputation
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  Speaker 6: in Hollywood. It's important to keep her at the Walt
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  Speaker 6: Disney Company.
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  Speaker 5: Are they going to be able to do that?
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  Speaker 4: I absolutely think so. So, you know, they obviously this
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  Speaker 4: was a very clever move by the board to kind
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  Speaker 4: of create this new role for Dana Walden, make her
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  Speaker 4: the president and the chief creative officer. They've never had
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  Speaker 4: this before, but they specifically created this one for Dana Walden,
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  Speaker 4: so that I think really kind of I think dispels
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  Speaker 4: a lot of fears about what would happen from a
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  Speaker 4: creative perspective. You know, last time, this was the same
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  Speaker 4: problem that you know, many investors raised when Bob Japek
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  Speaker 4: became CEO. So having her there in the creative role
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  Speaker 4: I think definitely plays very well with Hollywood, with the
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  Speaker 4: creative community. And ensures that, you know, Disney will still
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  Speaker 4: have a top tier content coming to its streaming platforms
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  Speaker 4: for the foreseeable future.
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  Speaker 2: So Josh Deamarrow takes the job on March eighteenth, that's
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  Speaker 2: when the succession is effective. And we talked about how
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  Speaker 2: yesterday Disney came out with a forecast that was fairly tepid,
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  Speaker 2: and one way of looking at that is it kind
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  Speaker 2: of you know, clears the deck.
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  Speaker 3: Lets him start off with the clean say.
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  Speaker 2: And set expectations and kind of manage it for investors
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  Speaker 2: a way that he sees fit. At what point does
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  Speaker 2: he own everything that happens to Disney.
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  Speaker 4: So actually a lot of the things that we're seeing
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  Speaker 4: right now with the Parks has been under Josh Tomorrow's watch.
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  Speaker 4: Remember once Bob Chapek was promoted to the CEO position,
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  Speaker 4: Josh Tomorrow assumed the role of chief of the Parks,
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  Speaker 4: and so all of the different initiatives that we've seen,
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  Speaker 4: you know, whether it's Lightning Lane, whether it's Genie, whether
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  Speaker 4: it's the sixty billion dollar expansion, a lot of that
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  Speaker 4: has been you know Josh Tomorrow's doing. So yeah, I mean,
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  Speaker 4: of course we're you know, I think the street is
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  Speaker 4: definitely going to give him a few quarters to kind
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  Speaker 4: of settle in, But he has pretty much been the architect,
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  Speaker 4: along with Barb Aiger, I'm sure and the rest of
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  Speaker 4: you know, the management team in kind of instituting the
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  Speaker 4: strategy and making the parks a prominent, you know, part
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  Speaker 4: of the portfolio going forward. So very soon, you know,
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  Speaker 4: the short answer, Scarlett is very soon. I think he
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  Speaker 4: owns pretty much all of this right away.
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  Speaker 6: In fact, Keith I five Josh Tomorrow, day one of
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  Speaker 6: my tenure CEO. I would go and I would say, hey,
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  Speaker 6: explain to me why we are not spinning out are
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  Speaker 6: broadcasting cable networks. They are businesses that are in a
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  Speaker 6: secular decline. They're dragging down our multiple Let's cut them loose.
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  Speaker 6: Do you think that's even an option for the Walt
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  Speaker 6: Disney Company.
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  Speaker 4: I think it is. I think everybody is considering that
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  Speaker 4: right now. I mean we've just seen what you know,
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  Speaker 4: Warner Brothers Discovery has been able to achieve by kind
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  Speaker 4: of separating out it's a studio and streaming from the
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  Speaker 4: TV network's business. So I definitely would not rule that out.
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  Speaker 4: I'm sure Disney will consider and Josh Tomorrow will consider
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  Speaker 4: all options once he becomes CEO.
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  Speaker 2: What happens to Jimmy Pataro over at ESPN, I mean,
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  Speaker 2: does that become part of the spinouts as Paul was
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  Speaker 2: talking about it, Because there's different parts of Disney's media
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  Speaker 2: business that are slowing down that are no longer the
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  Speaker 2: crown rules the way they once were, whether you're talking
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  Speaker 2: about the network television, or whether you're talking about ESPN,
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  Speaker 2: or whether you're talking about the movie business.
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  Speaker 4: Yeah, I think sports is still very core to Disney.
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  Speaker 4: I mean they are so if you just kind of
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  Speaker 4: look at the US sports landscape, ESPN actually owns majority
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  Speaker 4: of the marquee US sports right almost about forty percent
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  Speaker 4: of all sports viewing happens on ESPN platforms. So obviously
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  Speaker 4: it's still very core to the company. As far as
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  Speaker 4: Jimmy Pittaro is concerned. Scarlett, I mean, yes, he was
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  Speaker 4: one of the you know, candidates that they were considering
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  Speaker 4: to take on this job, but I think he himself
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  Speaker 4: had many times indicated that he was not really interested
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  Speaker 4: in the top spot. I think he kind of carries
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  Speaker 4: on business as usual with ESPN. You know, it's a
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  Speaker 4: little bit of a wait and watch what exactly happens
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  Speaker 4: with the strategy. It is really instrumental, I think, to
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  Speaker 4: their streaming business because you know, as they kind of
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  Speaker 4: mentioned even yesterday on their earnings call, you know a
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  Speaker 4: lot of people taking the bundle, the ESPN streaming plus
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  Speaker 4: the Disney plus the Hulle. So it is a critical
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  Speaker 4: portion of that. So I'm not really sure how exactly
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  Speaker 4: a spinout Wood would work. But of course, again, you know,
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  Speaker 4: we are in a very very different time and age,
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  Speaker 4: and everybody is thinking about all possible options when it
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  Speaker 4: comes to a media.
• 7:00
  Speaker 5: Stay with us. More from Bloomberg Intelligence coming up after this.
• 7:07
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
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• 7:17
  Speaker 1: get your podcasts, or watch us live on YouTube.
• 7:21
  Speaker 6: PayPal Holding said HP chief executive officer Enrique Lauris will
• 7:27
  Speaker 6: take the top job from Alex Chris, whose turnaround plan
• 7:30
  Speaker 6: failed to meet targets and streamline the payments business. The
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  Speaker 6: stocks down nineteen percent today, fifty two week low, off
• 7:37
  Speaker 6: twenty seven percent year to date, off over fifty percent
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  Speaker 6: over the trailing twelve months. This is a name I
• 7:43
  Speaker 6: thought at the beginning of this whole fintech thing that
• 7:45
  Speaker 6: this had This was a company that could really be
• 7:47
  Speaker 6: a leader there, but that has not been the case.
• 7:49
  Speaker 5: Dick sa Garrett joins us.
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  Speaker 6: She's a senior fintech and payments analyst for Bloomberg Intelligence Dix.
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  Speaker 5: Not a good day for PayPal. What's going on here?
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  Speaker 7: Yeah, definitely right, like two big headlines. Hit At once
• 8:03
  Speaker 7: missed four Q expectations and then announced a CEO change.
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  Speaker 7: So on the print side, adjusted EPs was about a
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  Speaker 7: four percent miss and the revenue came in one percent lower,
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  Speaker 7: and I should highlight this is like their first miss
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  Speaker 7: in two years. But I think the bigger issue is
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  Speaker 7: forward looking branded checkout, which is the main core high
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  Speaker 7: margin business for PayPal that has slowed to one percent
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  Speaker 7: in the fourth quarter. And PayPal is also flagging in
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  Speaker 7: earnings decline for twenty twenty six, So those were the
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  Speaker 7: key forward looking problem areas, and the CEO change definitely
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  Speaker 7: was a surprise. I mean, the guidance division was driven
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  Speaker 7: by their investments in some of the merchant business that
• 8:47
  Speaker 7: they're doing, but I think the market reaction goes beyond that.
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  Speaker 7: I think it goes more around some of the serious
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  Speaker 7: gaps that appear to have been discovered actually with Apple
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  Speaker 7: Bay and all the product advancements that the competition has
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  Speaker 7: come through, and I think, yeah, lots to unpack there today.
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  Speaker 6: So just give us a sense of the competitive landscape
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  Speaker 6: of the businesses that paypals and the financial technology and
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  Speaker 6: kind of where do they fit in what are they
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  Speaker 6: maybe not doing right here?
• 9:19
  Speaker 7: So PayPal has two parts of the ecosystem. It works
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  Speaker 7: with the merchants where you see the PayPal button when
• 9:26
  Speaker 7: you check out, and it works with the consumers through
• 9:28
  Speaker 7: its app, the PayPal app and the Venmo app. What
• 9:33
  Speaker 7: is very interesting is that management kept highlighting execution, discipline
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  Speaker 7: and prioritization, but honestly, like that is the main game.
• 9:42
  Speaker 7: PayPal's biggest A value ad is the two sided network.
• 9:46
  Speaker 7: They could not have afforded to either drop the merchant
• 9:50
  Speaker 7: or forget about the consumer. So it's been like it's
• 9:53
  Speaker 7: a very competitive landscape. You have Stripe, Aden, Apple, pay
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  Speaker 7: Is you would have noticed recently revised their partnership from
• 10:03
  Speaker 7: they moved from Goldman's to JP Morgan. So everyone is
• 10:06
  Speaker 7: charging first there and PayPal needs to show up on
• 10:09
  Speaker 7: that and I thought they were getting that. But I
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  Speaker 7: think this new CEO to change definitely puts a multi
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  Speaker 7: year transformation back in the play now.
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  Speaker 6: So what do you think is the is the next
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  Speaker 6: step for this company here? I mean a can of
• 10:25
  Speaker 6: kind of remain competitive in this business going forward? Does
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  Speaker 6: it need to think about a new structure or a
• 10:31
  Speaker 6: new strategy.
• 10:32
  Speaker 5: What do you think needs to happen here?
• 10:34
  Speaker 7: Yeah, that's the million dollar question, Paul. I think so
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  Speaker 7: there are two things. One is, I think investors need
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  Speaker 7: really need clarity now on how PayPal reaccelerates hiscore checkout business.
• 10:43
  Speaker 7: Is it conversion, is it pricing merchant value proposition, because
• 10:48
  Speaker 7: that's still the core engine. But I think secondly is
• 10:51
  Speaker 7: whether the new leadership really signals of broader strategic shakeup,
• 10:55
  Speaker 7: Like do they streamline initiatives, are they going to step
• 10:58
  Speaker 7: up cost discipline or capital return or if it doesn't
• 11:01
  Speaker 7: work out, maybe they'd consider like big assets like Venmo.
• 11:05
  Speaker 7: You know, strategically, the performance doesn't inflect from that.
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  Speaker 6: So what's the fintech landscape like these Daystally, it seems
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  Speaker 6: like it's very quickly evolving. Here, Just give us a
• 11:15
  Speaker 6: sense of the lay of the land airs ore. You
• 11:18
  Speaker 6: talk to anybody under the age of thirty, they ain't
• 11:20
  Speaker 6: got any cash in their pockets.
• 11:21
  Speaker 5: So what's the whole new world out there?
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  Speaker 7: Yes, I'm with you that, which is why it was
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  Speaker 7: quite interesting that they replaced Alex Chris is the CEO.
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  Speaker 7: I think the landscape is intensely competitive. The two key
• 11:35
  Speaker 7: themes that are driving at the cutting edge of fintech
• 11:39
  Speaker 7: is the innovation around agentic payments, agentic commerce where paper
• 11:43
  Speaker 7: was showing up in a big way as well, and
• 11:45
  Speaker 7: stable coins, which is again like moving transactions on the blockchain.
• 11:51
  Speaker 7: And things are moving really fast, Paul, because as you
• 11:55
  Speaker 7: really pointed out, like nobody carries cash in their wallet.
• 11:58
  Speaker 7: The younger generations want transactions to happen in the flip
• 12:02
  Speaker 7: of a second. There is and you know, the base
• 12:05
  Speaker 7: at pitch software and AI has moved payments needs to
• 12:09
  Speaker 7: kind of keep pace with that. So and the regulatory
• 12:13
  Speaker 7: regime obviously has supported that as well. So there is
• 12:15
  Speaker 7: a lot going on, and I just worry that if
• 12:18
  Speaker 7: Peopal is going to get left behind.
• 12:21
  Speaker 5: Stay with us. More from Bloomberg Intelligence coming up after this.
• 12:28
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 12:32
  Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
• 12:35
  Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever
• 12:38
  Speaker 1: you get your podcasts, or watch us live on YouTube.
• 12:42
  Speaker 5: Pepsi out with some numbers today.
• 12:44
  Speaker 6: The earnings beat estimates, But for me, the big thing
• 12:47
  Speaker 6: is Pepsi's going to cut De Rito's prices by as
• 12:50
  Speaker 6: much as fifteen percent to boost demand.
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  Speaker 5: When you see that, I just can't remember.
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  Speaker 3: Double did your price cut?
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  Speaker 6: Well, I just don't think you remember the prices of
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  Speaker 6: sieyes one.
• 13:00
  Speaker 5: When all the supply chain stuff happened. Okay.
• 13:03
  Speaker 6: I could see how they were jacking up prices because
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  Speaker 6: a pandemic, but they don't come down after the stuff's over,
• 13:09
  Speaker 6: do they. I mean, it's not like an avocado, which
• 13:11
  Speaker 6: is a commodity.
• 13:12
  Speaker 3: I want to see this charted out what it looks like.
• 13:14
  Speaker 5: Yes, over time.
• 13:15
  Speaker 6: Ken Chay, senior consumer Products analyst, joins us here from
• 13:17
  Speaker 6: Bloomberg Intelligence. Ken talk to us about Pepsi again. Came
• 13:21
  Speaker 6: out with some earnings results and then some interesting topics
• 13:24
  Speaker 6: about pricing some of their products.
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  Speaker 8: Yeah, Hi, Paul, Yeah, PepsiCo's numbers today, as you alluded to,
• 13:31
  Speaker 8: they beat their expectations by a little bit. But I
• 13:34
  Speaker 8: think the broad takeaway for investors from today is that
• 13:38
  Speaker 8: PepsiCo is committed to bringing better focus to this company.
• 13:43
  Speaker 8: You know, I've covered this company a long time and
• 13:45
  Speaker 8: it's it's primary competitors, Coca Cola, Cure, Doctor Pepper, you
• 13:49
  Speaker 8: can say, Primal Water Monster. How they different from PepsiCo
• 13:53
  Speaker 8: is the much more focused particularly specific categories. But PepsiCo,
• 13:59
  Speaker 8: with the urge of the activists urging them on, is
• 14:03
  Speaker 8: bringing more focus to this company. And what I mean
• 14:05
  Speaker 8: is they're rationalizing a lot of the SKUs that really
• 14:09
  Speaker 8: aren't contributing much. They're consolidating plans, they are bringing more
• 14:15
  Speaker 8: rationality to the trade spending. So when I hear things
• 14:19
  Speaker 8: that like, you know, cutting prices, that's tactical. That's just
• 14:22
  Speaker 8: a way to move the need a little bit with
• 14:24
  Speaker 8: near term sales. But I think the bigger picture is
• 14:27
  Speaker 8: to bringing more focus to this enterprise, and I think
• 14:29
  Speaker 8: that's what's behind a lot of the enthusiasm behind the
• 14:32
  Speaker 8: share price today, right.
• 14:33
  Speaker 2: I mean, investors are excited about it strategy as opposed
• 14:37
  Speaker 2: to just kind of moving forward with the way it's
• 14:39
  Speaker 2: always been. When it comes to those price cuts, though,
• 14:42
  Speaker 2: I wonder if this is going to spark any kind
• 14:44
  Speaker 2: of price war, will other snack makers feel the pressure
• 14:48
  Speaker 2: to also reduce prices, even if they've gone up quite
• 14:50
  Speaker 2: a bit since the pandemic.
• 14:53
  Speaker 8: That's possible, Scarlett. In the case of free too lay though,
• 14:56
  Speaker 8: they have such a dominant market share, and they have
• 14:59
  Speaker 8: like sixty percent of the market in the in the
• 15:01
  Speaker 8: measure channels, and when you have that much of a share,
• 15:05
  Speaker 8: you deserve a premium. Particularly with Petsico's direct store delivery system.
• 15:11
  Speaker 8: What that means is that they help their retailers much
• 15:14
  Speaker 8: more than a lot of their competitors, and that is
• 15:17
  Speaker 8: they actually go to the store quickly, respond to out
• 15:20
  Speaker 8: of stocks, they help you know, position the product, they
• 15:24
  Speaker 8: create the end caps in the in the store. They
• 15:27
  Speaker 8: do a lot more for the retailer than the competitors.
• 15:31
  Speaker 8: And so that's how they are helped to get premium pricing. So, yes,
• 15:35
  Speaker 8: they're rolling back some prices. You know, it's no secret
• 15:38
  Speaker 8: that price increases have been up quite a bit since
• 15:41
  Speaker 8: the pandemic, and a lot of it's cost driven. Uh
• 15:45
  Speaker 8: and and private label has encroached a little bit on
• 15:48
  Speaker 8: PepsiCo share. But to answer your question directly, they are
• 15:51
  Speaker 8: the dominant player. I would not expect them to give
• 15:54
  Speaker 8: back too much over time. And while their competitors may
• 15:59
  Speaker 8: cut price as well, I think retail would be alienating
• 16:03
  Speaker 8: consumers if they pushed too hard on Petsico's price increases
• 16:07
  Speaker 8: down the road.
• 16:09
  Speaker 5: I was just in the shop rate in Bellmart, New
• 16:10
  Speaker 5: Jersey yesterday. Lots of private label stuff on the shelves.
• 16:14
  Speaker 5: I mean, prominent shows.
• 16:15
  Speaker 3: How are you reaching for this?
• 16:16
  Speaker 5: I am in many cases. I am in many cases.
• 16:19
  Speaker 5: Ken talk to us about Elliott Management.
• 16:20
  Speaker 6: They've been in this company, they've owned this stock here
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  Speaker 6: pushing for some change.
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  Speaker 5: How much of an impact are they having.
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  Speaker 8: I think on the margin there's an impact. Poll maybe
• 16:31
  Speaker 8: to the degree that Petsico is hastening. It's moved to
• 16:34
  Speaker 8: more focus, you know a lot of the things that
• 16:36
  Speaker 8: it's been doing all along, and that is upbringing their
• 16:40
  Speaker 8: portfolio with more functionality. This is some of the things
• 16:44
  Speaker 8: we talked about in the past. They're bringing more protein
• 16:47
  Speaker 8: to their mix, the poppy prebotic sodas, they're bringing i'm sorry,
• 16:52
  Speaker 8: more fiber, the probiotic sodus. They're bringing more protein by
• 16:56
  Speaker 8: restaging muscle milk, so bringing more value to to the beverages.
• 17:04
  Speaker 8: So they've always been doing that, but to your question,
• 17:07
  Speaker 8: Elliott is pushing them to do things like, Okay, you
• 17:10
  Speaker 8: can still do that, but also cut costs a little
• 17:13
  Speaker 8: more aggressively. You know, maybe maybe you don't need all
• 17:16
  Speaker 8: these plants, Maybe you can consolidate some. Maybe there's some SKUs,
• 17:19
  Speaker 8: you know, some products that aren't selling, well you can
• 17:21
  Speaker 8: roll those back. Be a little more nimble when it
• 17:25
  Speaker 8: comes to getting rid of some products that aren't winners,
• 17:28
  Speaker 8: because at the end of the day, you have to
• 17:29
  Speaker 8: grab as much shelf space as the retailer as possible,
• 17:33
  Speaker 8: and when you have products on the shelf that aren't moving,
• 17:35
  Speaker 8: you're not helping them, you know, with their business. So
• 17:38
  Speaker 8: be more a little more aggressive with that. So it's
• 17:41
  Speaker 8: helping and I think that's a positive thing for shareholders.
• 17:46
  Speaker 2: Is this a company that's going to have to separate
• 17:48
  Speaker 2: its drinks business from its back business.
• 17:51
  Speaker 8: Well, that's the age old question we've been talking about
• 17:54
  Speaker 8: for a while. And as I mentioned, if it can
• 17:57
  Speaker 8: prove to the market that this increased focus that they
• 18:00
  Speaker 8: have with just doing their you know, daily business or
• 18:03
  Speaker 8: running these operations, they can improve them. I think the
• 18:07
  Speaker 8: heat will be off for them to go to the
• 18:09
  Speaker 8: draconian measure of breaking up food and beverages. That's always,
• 18:13
  Speaker 8: you know, the wild card I think down the road,
• 18:16
  Speaker 8: and I think will be well received by the market
• 18:17
  Speaker 8: quite frankly, but I don't think it's necessary at this point.
• 18:21
  Speaker 6: What are you consumer product products companies telling you ken
• 18:25
  Speaker 6: about just the consumer out there?
• 18:29
  Speaker 8: Well, Altria just the other day. I mean, it's a
• 18:31
  Speaker 8: different market with cigarettes, you know. They noted that consumers
• 18:34
  Speaker 8: are still hesitant in paying up for premium products, and
• 18:37
  Speaker 8: the cigarettes mentioned isn't the same category as salty snacks,
• 18:42
  Speaker 8: but they do note that consumers are reaching for the
• 18:46
  Speaker 8: private label, the low priced alternative, more than they've done
• 18:49
  Speaker 8: in the past, and so the extent of that that
• 18:51
  Speaker 8: carries over to you know, sacks and beverages. I can
• 18:54
  Speaker 8: see some parallel lines here, and as more companies, uh
• 18:58
  Speaker 8: you know, release their numbers, I think that could be
• 19:00
  Speaker 8: a common theme here that private labels encroaching and maybe
• 19:04
  Speaker 8: there needs to be some more deceleration in the uh,
• 19:07
  Speaker 8: you know, reliance on price increases to stimulate sales growth.
• 19:13
  Speaker 5: Stay with us. More from Bloomberg Intelligence coming up.
• 19:19
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 19:23
  Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
• 19:26
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• 19:30
  Speaker 1: you get your podcasts, or watch us live on YouTube.
• 19:34
  Speaker 3: It is earning season.
• 19:35
  Speaker 2: We're knee deep in it and big pharma is reporting,
• 19:37
  Speaker 2: and let's start off with Pfizer. The shares are down
• 19:40
  Speaker 2: about three point four percent. Pfizer is trying to break
• 19:44
  Speaker 2: into the anti obesity market, the you know, the diet pills,
• 19:49
  Speaker 2: we don't call it die pills, weight loss waits, yes,
• 19:52
  Speaker 2: and not getting very far in it. They've made some big,
• 19:54
  Speaker 2: big investments and it's time now to see how it's
• 19:57
  Speaker 2: all paying off or perhaps not. Sam Fizzelli is out
• 20:00
  Speaker 2: our director of research for Global Industries and senior pharmaceuticals analysts,
• 20:03
  Speaker 2: and he's in London right now with a jacket that
• 20:06
  Speaker 2: says this.
• 20:08
  Speaker 5: BI drug Boss. BI is Bloomberg Intelligence.
• 20:11
  Speaker 3: And he's the drug Boss.
• 20:12
  Speaker 5: And he's the drug boss all right.
• 20:14
  Speaker 9: So your producer told me I can wear it, so
• 20:18
  Speaker 9: if I shouldn't have, a very good friend of BI
• 20:21
  Speaker 9: got this for me. So I thought that these ones
• 20:23
  Speaker 9: I should hear it otherwise that's my boring jacket on next.
• 20:26
  Speaker 2: No, no, no, we welcome it, mister drug boss, So
• 20:29
  Speaker 2: thank you for joining us again.
• 20:30
  Speaker 3: Sam.
• 20:31
  Speaker 2: Let's talk a little bit about these visor results because
• 20:34
  Speaker 2: it feels like it's the you know, people aren't paying
• 20:37
  Speaker 2: that much attention to what happened in the fourth quarter
• 20:39
  Speaker 2: or even the reaffirmed full year guidance. It's all about,
• 20:42
  Speaker 2: you know, the latest data on the obesity drug from
• 20:46
  Speaker 2: met Sarah, which Vizer is purchasing.
• 20:49
  Speaker 9: Yeah, yeah, so look they paid ten point one billion
• 20:51
  Speaker 9: dollars for this and the share price is down three percent.
• 20:54
  Speaker 9: If it all to do with that, there is it
• 20:55
  Speaker 9: people being reminded again that the next three four years
• 20:59
  Speaker 9: there's a may headwind from generic drugs coming for there
• 21:03
  Speaker 9: some of the key products on the market eyebrands, ex Standy,
• 21:08
  Speaker 9: et cetera. So that's partly the issue. And you know,
• 21:11
  Speaker 9: in order to deal with that, you need assets and
• 21:14
  Speaker 9: drugs that are going to try and hopefully fill the gap.
• 21:17
  Speaker 9: And maybe this is the problem with the data. The
• 21:19
  Speaker 9: thing is, we've looked at the data, as you know,
• 21:22
  Speaker 9: we have very deep obousity analysis. We've looked at the
• 21:24
  Speaker 9: data and it's not terrible. But as I said the
• 21:28
  Speaker 9: other day when Rash reported there's some numbers, I think
• 21:31
  Speaker 9: folks are getting over this percentage here, percentage there. You
• 21:36
  Speaker 9: can only to the point going forward you can't, I
• 21:38
  Speaker 9: mean unless you give out somebody that are thirty forty weights,
• 21:41
  Speaker 9: which of course nobody wants. So this is getting to
• 21:44
  Speaker 9: a point where now it comes to the nuance, and
• 21:47
  Speaker 9: unfortunately we don't have a lot of the nuance that
• 21:49
  Speaker 9: we need to know about this data set tolerability. And
• 21:53
  Speaker 9: it is good because it's a once monthly injection after
• 21:55
  Speaker 9: the first few weeks, so it's well set up, but
• 21:59
  Speaker 9: the market obviously doesn't like it because they're not getting
• 22:01
  Speaker 9: enough information about how good actually it is. Sam.
• 22:04
  Speaker 6: It seems like if you want to be an investor
• 22:06
  Speaker 6: in big cap farming, you really have to be a
• 22:09
  Speaker 6: stock picker. I've got stocks like Pfizer and Bristol on
• 22:11
  Speaker 6: a trailing twelve month basis that are down. But I've
• 22:15
  Speaker 6: got stocks like Johnson and Johnson and Eli Lilly and abby.
• 22:18
  Speaker 5: V They're are big.
• 22:20
  Speaker 6: And is that just because they've got the right portfolio
• 22:22
  Speaker 6: of drugs and the others don't.
• 22:25
  Speaker 9: Entirely entirely about that what is. What you don't want
• 22:29
  Speaker 9: is looking into the abyss of generic drugs coming for
• 22:32
  Speaker 9: your big earners with no obvious pipeline versus, let's take
• 22:37
  Speaker 9: it Johnson and Johnson. In this case, they have a
• 22:40
  Speaker 9: phenomenal set of drugs for the multiple miloma space or
• 22:46
  Speaker 9: a whole you know, other oncology spaces. This is the powerhouse.
• 22:49
  Speaker 9: And of course they've also still got the other divisions
• 22:52
  Speaker 9: medical devices growing quite nicely so and no massive I mean,
• 22:58
  Speaker 9: there's one that's coming up, big hole that's coming in
• 23:01
  Speaker 9: terms of generics, but they've still got these things that
• 23:04
  Speaker 9: are growing at phenomenal speed. And one of their drugs, Dolllects,
• 23:08
  Speaker 9: is very close to twenty billion dollars and that's just
• 23:11
  Speaker 9: one indication in multiple myloma. So they've done everything right
• 23:14
  Speaker 9: in that case, and that's what the market likes.
• 23:17
  Speaker 2: So in other words, Sam, this is something that can
• 23:19
  Speaker 2: be managed. The fact that Pfiser hasn't managed this well
• 23:23
  Speaker 2: raises a lot of questions here, because I mean it's
• 23:26
  Speaker 2: not like just one day they woke up and oh,
• 23:28
  Speaker 2: you know, there's suddenly a lot of competition for some
• 23:31
  Speaker 2: of their best selling drugs, or people are no longer
• 23:34
  Speaker 2: paying up for COVID treatments COVID vaccines. In terms of management,
• 23:38
  Speaker 2: do investors need to question whether adviser has right management
• 23:42
  Speaker 2: in place?
• 23:44
  Speaker 8: Yeah?
• 23:44
  Speaker 9: I mean, look, this is a tough game, right, not
• 23:48
  Speaker 9: a game of course, this is a very tough set
• 23:51
  Speaker 9: of issues to deal with. Creating pipeline takes a lot
• 23:56
  Speaker 9: of effort. Let's take Eli Lilly. For years, nobody was
• 23:59
  Speaker 9: paid too much attention to their potential margin expansion that
• 24:02
  Speaker 9: was coming and they were arguing for it, et cetera.
• 24:05
  Speaker 9: Maybe they were lucky they hit on these obesity drugs
• 24:08
  Speaker 9: you get. Ask for Zeneca. It took quite a lot
• 24:10
  Speaker 9: of pain for Pascal Soio. You should write that ship
• 24:14
  Speaker 9: when he took it. So management's part of it. Then
• 24:17
  Speaker 9: you need to be lucky. You cannot have just one
• 24:21
  Speaker 9: or the other and pipeline. You know, we'll see what
• 24:24
  Speaker 9: Filer shows us over time. They have assets that are
• 24:26
  Speaker 9: in earlier development that we need to start seeing their fruit.
• 24:29
  Speaker 6: Hey, Sam John from the Jersey Short times in any
• 24:32
  Speaker 6: ass will AI have a meaningful impact on coming up
• 24:35
  Speaker 6: with new drugs, new therapies?
• 24:36
  Speaker 5: Is this going to really be a game changer?
• 24:39
  Speaker 9: It will be. You need mich Colle Andrew galler on,
• 24:42
  Speaker 9: because it's done a lot of work on this, and yes,
• 24:45
  Speaker 9: the answer is it will be depending on what area
• 24:47
  Speaker 9: you're looking at. We think it can cut the time
• 24:50
  Speaker 9: to get a drug to market by a year or
• 24:52
  Speaker 9: so in the next five to ten years. By the
• 24:56
  Speaker 9: fact that you could use it for doing much better
• 25:00
  Speaker 9: work in the very early stage, in the pre clinical stage,
• 25:02
  Speaker 9: you can shave some serious time of that. We talk
• 25:05
  Speaker 9: to a lot of hospitals, a lot of clinicians, a
• 25:07
  Speaker 9: lot of scientists, and they're all super excited by that.
• 25:10
  Speaker 9: One of the key things that people are using is
• 25:12
  Speaker 9: this thing called Alpha fold that was developed by Google's
• 25:15
  Speaker 9: Deep Mind, and that is really making a difference to
• 25:17
  Speaker 9: people hunting for drugs at that early stage.
• 25:21
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• 25:29
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