Latest / What the Flux / Fortescue greened out | Microsoft's Canva-dupe | EssilorLuxotica goes Supreme

Transcript

Fortescue greened out | Microsoft's Canva-dupe | EssilorLuxotica goes Supreme · What the Flux

• 0:05
  Speaker 1: This is what the Flux.
• 0:06
  Speaker 2: I'm Brander Justin and at Monday, the twenty second of July,
• 0:09
  Speaker 2: Dozzy boy.
• 0:10
  Speaker 1: New jobs data was released late last week and the
• 0:13
  Speaker 1: jobs market is still relatively tight. It scurried its way
• 0:17
  Speaker 1: from four percent unemployment to just four point one percent,
• 0:20
  Speaker 1: and that means a slightly higher likelihood that next month's
• 0:23
  Speaker 1: Reserve Bank meeting could mean another cash rate rise. Bookieh
• 0:27
  Speaker 1: Spookie stuff, Fluxlam.
• 0:28
  Speaker 2: It's the time of the year where everybody is worried
• 0:30
  Speaker 2: about their tax return? How do I do it? When
• 0:32
  Speaker 2: do I submit it? How much money am I gonting
• 0:34
  Speaker 2: at back? That's why we built the Flux tax took
• 0:37
  Speaker 2: it within the Academy this month. Make sure you head
• 0:39
  Speaker 2: to the Flux app and check out the academy.
• 0:41
  Speaker 1: Three balance worthy stories today, Dozzy boy, let's do it
• 0:44
  Speaker 1: for our first four. Eskew Metals Group, one of Australia's
• 0:48
  Speaker 1: largest companies, has cut seven hundred jobs across its global
• 0:51
  Speaker 1: workforce after its green ambitions haven't quite met investor expectation.
• 0:55
  Speaker 2: Sounds like all that green hydrogen talk might not have
• 0:58
  Speaker 2: been all it was chalked up to be. So what
• 1:00
  Speaker 2: is the story here?
• 1:01
  Speaker 1: Well, juzzy Boy. Fortescue is the mining giant that was
• 1:04
  Speaker 1: founded by Andrew Twiggy twig Man Forest back in two
• 1:07
  Speaker 1: thousand and three.
• 1:08
  Speaker 2: It's since become the fourth largest iron ore producer globally,
• 1:11
  Speaker 2: with a marker cap of a wappen sixty seven billion dollars.
• 1:14
  Speaker 1: But dose the boy. Interestingly, Fordescue is also at the
• 1:16
  Speaker 1: forefront of developing green hydrogen technology.
• 1:19
  Speaker 2: Yep, it's set some pretty lotty goals to achieve it
• 1:22
  Speaker 2: net zero by twenty thirty. But now Fortescue has just
• 1:24
  Speaker 2: announced that it'll be acting seven hundred jobs globally and
• 1:28
  Speaker 2: restructuring its business. And not just that being man, it's
• 1:31
  Speaker 2: also scaling back it's green hydrogen initiatives because of high
• 1:35
  Speaker 2: energy prices.
• 1:36
  Speaker 1: You mean, the same green hydrogen initiatives that it's been
• 1:39
  Speaker 1: raving about since twenty twenty.
• 1:41
  Speaker 2: Yep, the very same, which is why Fortescue is highlighted
• 1:43
  Speaker 2: a number of times that it has no plans to
• 1:45
  Speaker 2: actually abandon these green hydrogen initiatives.
• 1:48
  Speaker 1: But there's still a lot of questions in the air
• 1:50
  Speaker 1: about whether Fordescue's investment in this new technology will actually
• 1:54
  Speaker 1: reap any results.
• 1:55
  Speaker 2: So what is the key learning here.
• 1:56
  Speaker 1: When a company chooses to innovate with new technology, it
• 1:59
  Speaker 1: needs to balance current shareholder value with long term growth potential.
• 2:03
  Speaker 2: We know that a company is obligated to a shareholder
• 2:05
  Speaker 2: aka the people who put money into the business.
• 2:08
  Speaker 1: So if a company wants to mix things up and
• 2:10
  Speaker 1: do something a little bit different, it needs to sell
• 2:13
  Speaker 1: the vision to shareholders successfully and be man.
• 2:15
  Speaker 2: That's not always easy because investing innovation is inherently experimental
• 2:20
  Speaker 2: and very risky.
• 2:21
  Speaker 1: There is just no promise that it's going to pay off.
• 2:23
  Speaker 2: Yeah, there's large upfront costs, there's a tension pulled away
• 2:25
  Speaker 2: from the core business as well.
• 2:26
  Speaker 1: In fordes Us case, it's green hydrogen initiative has accumulated
• 2:30
  Speaker 1: over two billion dollars in losses. That's so far, and.
• 2:32
  Speaker 2: While cutting edge technology that tackles climate change sounds exciting,
• 2:36
  Speaker 2: shareholders are only willing to wait so long to see
• 2:38
  Speaker 2: results from new initiatives. For our second story, Microsoft has
• 2:41
  Speaker 2: announced a new AI powered designer app late last week
• 2:44
  Speaker 2: to help newbies with their basic design skill.
• 2:47
  Speaker 1: This sounds real, can for dup. If you ask me,
• 2:50
  Speaker 1: juzzy boy, tell me everything you know.
• 2:52
  Speaker 2: Okay, So Microsoft is obviously the behemoth tech company started
• 2:55
  Speaker 2: back in nineteen seventy five and has grown to a
• 2:57
  Speaker 2: three point three trillion US dollar valuation.
• 3:00
  Speaker 1: We'd be talking about the second largest company in the
• 3:03
  Speaker 1: whole down universe based on market value.
• 3:05
  Speaker 2: Man. Although Microsoft has made some updates to its offer
• 3:08
  Speaker 2: suite over the years, let's be honest, they haven't been great.
• 3:11
  Speaker 1: Yep. PowerPoint praises still feel like they're from nineteen ninety eight.
• 3:14
  Speaker 2: So now Microsoft has announced a new AI powered app.
• 3:16
  Speaker 2: It's called wait for it, Designer every original name. It
• 3:20
  Speaker 2: can give you prompt templates to help kickstart the creative process.
• 3:24
  Speaker 2: Let's be honest, no one knows how to design and
• 3:26
  Speaker 2: give away post from scratch.
• 3:27
  Speaker 1: But boy, if you're thinking that it sounds awfully similar
• 3:30
  Speaker 1: to the c dog Ie Canvas, you would be right.
• 3:33
  Speaker 1: I was thinking that, actually, except Microsoft has one little
• 3:36
  Speaker 1: leg up on Canvas. It has a partnership with open Ai,
• 3:39
  Speaker 1: so there's a lot of AI in this tool too, And.
• 3:41
  Speaker 2: All of a sudden, Canvas may just have a big,
• 3:44
  Speaker 2: bad competitor in the design market.
• 3:46
  Speaker 1: Ooh, you went there. So what is the key learning here?
• 3:48
  Speaker 2: The hunter has become the hunted.
• 3:50
  Speaker 1: Over the past eleven years, Canvas identified a major gap
• 3:54
  Speaker 1: in the design market and grew from plucky upstart to
• 3:57
  Speaker 1: establish a leader of design software.
• 3:59
  Speaker 2: It was hunting down the design software market from Microsoft
• 4:02
  Speaker 2: and Adobe's Photoshop.
• 4:03
  Speaker 1: But after their rapid growth, they find themselves as the
• 4:06
  Speaker 1: company being hunted by Microsoft.
• 4:08
  Speaker 2: And be Man. When a tech leader rolls out a
• 4:10
  Speaker 2: new product into an existing offering, it has an enormous
• 4:13
  Speaker 2: strategic advantage distribution.
• 4:15
  Speaker 1: In fact, Microsoft already has more than one point five
• 4:19
  Speaker 1: billion Office sweet users around the globe.
• 4:21
  Speaker 2: Compare that to Canvas one hundred and seventy million users and.
• 4:24
  Speaker 1: Jesi boy this saying the first time we've seen a
• 4:26
  Speaker 1: global tech giant with massive distribution dupe another company's product
• 4:31
  Speaker 1: and make it into a feature.
• 4:32
  Speaker 2: For example, Garman and Tom Tom they were the leaders
• 4:34
  Speaker 2: in GPS mapping until Google and Apple made it an
• 4:37
  Speaker 2: app in their phones.
• 4:38
  Speaker 1: What about Adobe? They were the leader in the PDF
• 4:41
  Speaker 1: format until Microsoft created their own PDF viewer in the Office.
• 4:44
  Speaker 2: Suite, so be Man. Only time will tell if Canva
• 4:47
  Speaker 2: can maintain its design market dominance.
• 4:49
  Speaker 1: For our third and final story, the maker of ray
• 4:52
  Speaker 1: Ban Sonny's esselaw Laxotica, has acquired the Supreme Fashion brand
• 4:57
  Speaker 1: for one point five billion US dollarydo the.
• 5:00
  Speaker 2: Old Sunny's and streetwear colob I can kind of see
• 5:03
  Speaker 2: it working. Tell me all a bit of boutground here,
• 5:04
  Speaker 2: Juzzy boys. So, Eslor Luxotica is the merged company of
• 5:08
  Speaker 2: Luxotica from Italy and Essloor from France. Fun fact for you,
• 5:11
  Speaker 2: Eslo Lexotica pretty much owns all of the big eyewear
• 5:14
  Speaker 2: brands around the world.
• 5:16
  Speaker 1: We'd be talking ray Band Oakley, you're a per sol man,
• 5:19
  Speaker 1: and don't forget Sunglass Heart.
• 5:20
  Speaker 2: I've seen you in there a few times. That's the
• 5:22
  Speaker 2: Sunny's retailer and they've got over fifty two percent market
• 5:24
  Speaker 2: share in the eyewear industry.
• 5:26
  Speaker 1: Now, Juzzy boy, it must have come as a bit
• 5:28
  Speaker 1: of a surprise for you when they made a big
• 5:30
  Speaker 1: announcement late last week.
• 5:31
  Speaker 2: Eslo Luxotica announced it will acquire the streetwear brand Supreme
• 5:35
  Speaker 2: from VF Brands for one and a half billion US dollars.
• 5:38
  Speaker 2: That would be the on trend sweetwear brand that many
• 5:41
  Speaker 2: celebs rock in the papped shots around town. And interestingly,
• 5:44
  Speaker 2: this is Esla Luxotika's first acquisition of an apparel company.
• 5:48
  Speaker 1: Yeah, it would seem that they want to acquire Supremes
• 5:50
  Speaker 1: platform and connect to Supreme's audience, which is primarily gen Z.
• 5:54
  Speaker 2: And while the share price of Supreme's owner jumped eight percent,
• 5:57
  Speaker 2: the shares in Eslo Luxotica dropped.
• 5:59
  Speaker 1: Nearly four mainly because many investors are unsure about the
• 6:02
  Speaker 1: strategic fit of a streetwear brand in a luxury eyewear company.
• 6:06
  Speaker 2: So what is the key learning here?
• 6:07
  Speaker 1: A strategic fit is when an acquiring company can benefit
• 6:10
  Speaker 1: from synergies with the acquired company.
• 6:12
  Speaker 2: So Eslo Lexotica is trying to leverage Supreme brand equity
• 6:16
  Speaker 2: to not only grow the brand further, but also make
• 6:18
  Speaker 2: their eyewear cool again.
• 6:20
  Speaker 1: And while all of this makes sense in theory, doesn't
• 6:23
  Speaker 1: always work out in brattice.
• 6:24
  Speaker 2: Remember when will Worth acquired dick Smith for four hundred
• 6:26
  Speaker 2: and thirty million bucks.
• 6:28
  Speaker 1: And it ended up selling dick Smith to a private
• 6:30
  Speaker 1: equity firm for just twenty million bucks.
• 6:31
  Speaker 2: So esltt Lexotica will be hoping it can successfully leverage
• 6:35
  Speaker 2: its retail experience in starting to sell Fyfe Culture clothes
• 6:38
  Speaker 2: to gen Z flux Am. The sooner you is to
• 6:39
  Speaker 2: bit your tax returns, the sooner you can potentially get
• 6:42
  Speaker 2: your tax rebite. We've got it all covered in the
• 6:44
  Speaker 2: Flux Academy. This month the FI twenty four tax Toolkits.
• 6:47
  Speaker 2: Make sure to check it out.
• 6:48
  Speaker 1: Thanks for listening, and we'll see you on Wednesday.