©®™Uguba™ndubuisi™blog |: Morning Brief: Year of efficiency, year two

Saturday, 10 February 2024

Morning Brief: Year of efficiency, year two

Saturday, Feb 10

5 key stories we read this week

🏢 A 'manageable' problem for the Fed: In an interview with "60 Minutes" last weekend, Federal Reserve Chair Jerome Powell called the growing problem of overvalued office buildings sitting on bank balance sheets "manageable" while conceding some banks may fail. This week's action in shares of New York Community Bank (NYCB) suggests investors have their suspicions about which banks, in particular.

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⚖️ Powell's growing political conundrum: In a press conference earlier this month and again by CBS's Scott Pelley, Powell was asked about this year's election. The central bank, of course, sees itself acting outside the political process and away from the whims of elected officials. Ben Wersckhul explores not-so-distant history to find things are rarely that simple.

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✂️ Tech enters year two of its 'year of efficiency': The pink slips are still flying in the tech world as the Mark Zuckerberg-crafted idea of leaning out after a sector-wide hiring binge continues to rule the day.

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🏰 Disney shows signs of life after a solid quarter: Disney (DIS) stock popped 12% on Thursday after the company reported slimmer losses in its streaming unit, a new buyback, a higher dividend, an investment in Epic Games, a new Taylor Swift movie, and more. This sent shares to a 52-week high.

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🚘 A 'seismic change' in the EV market: Ford's (F) earnings this week saw the automaker get more explicit about where it sees opportunity in the EV market — big trucks and small cars. But nothing in the middle.

3 conversations we're still thinking about

🌯 Chipotle CFO Jack Hartung tells us how the fast-casual chain continues to grow its customer base as it battles rising costs and more cautious consumers.

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💅 "Barbie" was a box office hit, but Mattel CEO Ynon Kreiz has activist investors knocking on his door. The exec joined Yahoo Finance to discuss the future of that franchise and the road ahead for the company.

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🏈 FanDuel's CEO Amy Howe stopped by ahead of Sunday's Super Bowl and flagged the interest a certain entertainment giant is bringing not only to the events on the field, but to the wagering that takes place off it too.

For more graphics like this, follow Yahoo Finance on Instagram.

Chart of the week: Sports rights shakeup

The sports media world was rocked this week by news Disney (DIS), Fox (FOXA), and Warner Bros. Discovery (WBD) had found common ground on creating a new sports streaming joint venture.

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As Yahoo Finance's Allie Canal reported, this deal protects a group of "old media" mainstays against the new entrants from Big Tech that have begun throwing their weight (and money) around in the world of sports rights fees.

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Moreover, a unified distribution plan may take the "competitive tension out of the mix" when it's time for the major sports leagues to renegotiate their deals, as Solomon Partners' Mark Boidman told Yahoo Finance.

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But as our chart of the week shows, when we're talking about sports rights fees in the US we're really (mostly!) just talking about football.

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The NFL is the biggest cost center for every major player except Warner Bros. Discovery, which through its TNT channel is one of the NBA's national broadcast partners alongside ESPN.

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The college sports fees that show up across the spectrum are also heavily tilted towards football, especially at Fox and ESPN. (Paramount, through CBS, and WBD, through Turner, broadcast March Madness.)

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This weekend's Super Bowl will probably break viewership records, but not only — or necessarily — because of Travis Kelce's significant other. As Sportico wrote earlier this year, the NFL "swallowed TV whole" in 2023 with 93 of the top 100 most-viewed events of the year.

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The primacy of the NFL as a cultural and media industry force is barely worth stating at this point. What else would the answer be?

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How hard the league's power brokers choose to use this leverage to squeeze their media partners in the years ahead remains to be seen.

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But this week's developments suggest, at a minimum, some media leaders would rather face this pressure together than alone.

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Today's newsletter was edited by Myles Udland.