This is Bloomberg Intelligence with Scarletfoo and Paul Sweeney.
How do you think the FED is looking at tariffs? The uncertainty of terriffs.
Let's take a look at the sectors and how they performed a.
Lot of investors getting whip saled every day by news events.
Breaking market headlines, and corporate news from across the globe.
Could we see a market disruption of market events?
So people just too exuberant out there?
You see some so called low quality stocks driving this short term rally.
Bloomberg Intelligence with Scarlettfoo and Paul Sweeney on Bloomberg Radio, YouTube and Bloomberg Originals.
On today's Bloomberg Intelligence Show, we dig inside the big business stories impacting Wall Street and the global markets.
Each and every week, we provide in depth research and data on some of the two thousand companies and one hundred and thirty industries our analysts cover worldwide.
Today, we'll explain how the global business of sports is getting bigger fast.
Plus a look at the yearly Bloomberg BusinessWeek's ranking of the best business schools in the country.
But first, this week, President Trump pushed for a six month reporting schedule for publicly traded US companies. This would in the current quarterly format to quote, save money and allow managers to focus on properly running their companies for more.
Scarlet Foo and guest host Isabell Lee were joined by Michael Casper, Bloomberg Intelligence US equity strategists. They first asked Michael to break down what this would mean for earning season.
Certainly has been an idea that's been floated for quite some time among ESG circles, even if you go back to the twenty sixteen election, I believe Hillary was floating this idea. But it does have some validity in terms of aligning you know, shareholder ideas with long term performance and management incentives. Right, if management doesn't have to beat a quarterly number every quarter, they can more easily focus on the longer term, and that certainly has its merits.
But again, I don't think chan is the best analog to make right.
There, talk to us about the risks that semi annual reporting could post, because why haven't we done it? Obviously, I'm sure that our regulators and policymakers have way into pros and cons.
Yeah, so it's a it's less flow of information, right, So you think about the quarterly reporting schedule, you're getting information every three months. As an investor, you can process that information more accurately priced things in the market, And with a six month time frame, you lose a little bit of that, right, And obviously I think consensus estimates will be a little bit less let's say, accurate, because they have to forecast a six month time period instead
of a three month time period. So that there are some bumps in the road with adopting this, But again, if it can align shareholder value with management centis, maybe you do get a benefit out of it.
Would CEOs necessarily like this, I mean, I'm sure everyone wants to save time and save money that that was something that the President cited as a benefit of moving to six months reporting as opposed to three months, But in general, is this something that CEOs would favor.
I don't know if they would favor it. I think they'd be pretty indifferent to it. It's still the same scheme of you know, you've got a number every six months, you've got to beat that number. It's just more aligning that goal with with shareholder value, right, So I don't know necessarily if they favor one over the other. They might think their life is a little bit easier trying to beat on a six month time frame than a three month timeframe. But I don't know if it really
affects cost too much. As the President pointed.
Out, do you think that under the current SEC regime that this would actually be approved because to Scarlett's point earlier, and we all know this wasn't the first time this was floated, But yeah, maybe it will be approved.
Maybe, I don't know. There's again, it's been a really long push of this and back and forth. Should we do six months? Should we do annually? Evens there's some countries out there that do annual, and it really hasn't gained a lot of traction. I think investors in the US are really set on the quarterly reporting schedule. They really look for those quarterly numbers to drive their analysis, and so it's going to meet a lot of resistance amongst the investor.
Community, I think, yeah, especially as more retail investors are now investing in the market too. They want to hear from the companies directly, and a lot of those companies are tailoring their commentary to this new investor class as well. Not so much institutional investors, but the individual investors out there.
Yeah, certainly you've got this huge flow of zero day trading options and everybody trading around earnings events, especially in the retail space. That's huge. So maybe amongst the constituency, obviously they don't have as much of a lobbying voice as you know, your big institutional investors, but amongst his constituency, maybe there's a little bit of resistance there as well from the retail community.
Would there be a sector or industry that would benefit from a semi annual report, good question.
Oh yeah, I don't know necessarily, if I could pick a sector that would benefit the most. I think tech obviously has gained the most from the quarterly reporting schedule.
Right.
They've done a really good job of managing their earnings and consistently beating and you know, we've seen it time and time again. IBM was the bastion of this back in the nineties and early two thousands financial engineering to beat the quarterly number. It's since, I would argue it's been Apple and Microsoft have been very good at it. So I think Tech's been the biggest beneficiary, So maybe the biggest.
Our Thanks to Michael Casper Bloomberg Intelligence US equity strategist and.
Speaking of earnings, Paul, we got results from Cracker Barrel this week.
The company offered sales guidance that missed expectation, showing the brand is still dealing with a fallout from its controversial and short lived logo change.
For details, we caught up with BI restaurant analyst Michael Halen.
They were recorded a great quarter. You know, Same Star sales were up five point four percent in the restaurants, a couple hundred basis points ahead of the street. But sales have decelerated pretty significantly here, you know, since August in the logo controversy. So you know, thought Julie Messino did a great job. I think she's running a steady
ship right now. And you know, they're focusing on the things that they've been focused on from the beginning, which is providing better service and higher quality food at a good price point. I would say it seems like they may have sandbag guidance as well. They basically are extrapolating current track grafic trends throughout the rest of the quarter. You know, when second measure data that that Bloomberg owns that that we follow is showing that traffic may be
stabilizing here. So I guess, I guess we'll see.
All right, let's move on to what's going on with our friends that darted.
Yeah, you know Darden. It was an interesting quarter. Sales were fantastic, but slightly below you know, very high expectations, and the most interesting part of their report was that their margins contracted, largely due to beef costs and Uber fees because they did this one million free delivery promotions supported by you know, Uber eats marketing dollars, right, and so it actually made up five percent of sales, and that's very impressive for something that's been instituted, you.
Know, within a year.
So, yeah, the margins, you know this, this company has best in class margins. They've always protected their margins and so seeing a same store sales gain that, you know, a very strong same star sales gain without the margin expansion, I think shocked some investors.
So what are they planning to do to widen those margins? I heard the portions might not be as big? Are they looking at possibly raising prices on the menu.
Well, they're going to raise prices, but not too aggressively. So they're very careful about increasing their prices. A big reason why we think they're outperforming is that they've increased their prices a lot less than competitors since the pandemic, right, and so they don't want to lose that advantage. So they are going to raise prices this year, but it's going to be modest and less than peers. You know, you mentioned the smaller entrees. That's really a move to
boost traffic. So what they're doing is they're taking seven of their popular entrees. They're making an additional, lighter menu with those seven items. They're shrinking the portion and they're lowering the price, and they're hoping that actually brings in greater traffic with low income consumers. So shrinking the size of the entrees isn't isn't a major plan in terms of saving the margins. With the margins, it's going to be you know, executing rights. That's what they're known for,
you know, consistently becoming more productive in their restaurants. That's how they're going to try to fund this. You know, there will be some slight price increases, and they mentioned they could be a little bit more aggressive. If you know, the higher beef prices remain stubborn.
Thanks to bi's Michael Halen.
We also got earnings from General Mills this week.
The maker of curios reported a solid quarter but was cautious about the road ahead.
We spoke with b I Consumer Stables analyst Diana rosso Penya.
They were mainly in line with expectations. It wasn't that much of a surprise, but still, you know, the stock is a little bit on the south side. People expected better news than what they disclosed.
Yeah, I mean North America sales came under pressure. What was the drag there?
It was mainly on volume. We expected volume declines but not to the magnitude that they did. It was down four percent on organic on the organic part, so obviously consumers are still trading down. They are mentioning that, you know, about eight brands of theirs. It was positive, but it's still it wasn't enough for the whole segment two to pull through.
What are they doing or what are they saying about tariffs and the impact on their costs versus maybe what they're trying to pass along to customers.
So they are upsetting some of the costs with cost savings. It's usually going to be They expected to be about one to two percent of cogs this year, which is a little bit lower than for example, Campbell's expected they expected around four percent.
So you know, they're not there.
They do not want to raise prices. They want to be competitive because obviously volume growth is not happening.
So yeah, I mean, they're getting competition from more folks. I mean, on the one hand, they're benefiting from the fact that more people are eating at home, right, but yet when we're going to the supermarket, more people are choosing those private label brands. What's their sort of you know, plan of attack there.
Yeah, so they're increase in marketing, They're they're hoping for innovation.
Uh.
They mentioned that twenty five percent of sales growth will come in North America retail will probably come from innovation this year. And this is what all everybody's trying to get to the problem is. And that was mentioned on the call as well, was that even the price increases are not as significant as it used to be, they're still high.
So on a basket size.
You're still paying a lot more than the used to two years ago.
Talk to us about store brands versus kind of the the brands. We all grew up with. Here, tell us how that's changed over time. Our store brands are becoming a bigger, bigger part of the average cart.
Yes, well, retailers are investing more on their private label. It allows them to bring people into the store. Some of the brands are have a cult following. I will say, hello, Costco so exactly, so people are going to the store to buy that particular brand. They're more profitable than national brands, So obviously they're still incentive for retailers to deploy some of that some of their own I think.
Some people take it cheek to buy private label, right, Well, we're at like a badge of honor.
Certainly. I was shocked at the price differential.
Yeah, because they have that pricing power right These stores to you know, make their products a lot more attractive. Really quick Blue Buffalo, it's their pet food. I was surprised to see that that that was not a leader for them.
Yeah, so Wilderness was not is not doing as well as they are hoping. Dog food in general has been a headwind, not only for them but also for the overall industry. Cat food seems to be the leading indicator here, which is surprising, but.
Cat food is outpacing dog food.
Yes, correct, We have seen this for the past year. There seems to be a growth in the cat population more than the dog population.
Thanks to Diana coming out.
We look at Elon's purchase of one billion dollars worth of Tesla shares.
Listening to Bloomberg Intelligence on Bloomberg Radio, providing in depth research and data on two thousand companies and one hundred and thirty industries.
You can access Bloomberg Intelligence via bi go on the terminal. I'm Alexis Christophers and now Paul Sweeney.
This is Bloomberg.
This is Bloomberg Intelligence with Scarlett Foo and Paul Sweeney on Bloomberg Radio.
I'm Paul Sweeney. Join this week by Alexis Christophers. We moved to news from the ev giant Tesla. This week Elon Musk purchased about one billion dollars worth of Tesla shares.
And this comes after the billionaire was awarded one of the biggest pay packages in corporate history. For details, host Scarlett Foo and guest host Isabelle Lee were joined by Bloomberg Global Autos editor Craig Trudell.
There was an all out push with Robin Denholm the chair of the company, speaking with us at Bloomberg Television, speaking with you know, the New York Times, the Wall Street Journal, all sorts of major news organizations about the merits of this pay package that the board is proposing. There's going to be a big shareholder vote in November on handing you know, Musk, this this potentially up to
one trillion dollars worth of stock. There's a lot of caveats all that that Musk would have to sort of you know, pull a rabbit out of the hat again after you know, doing so after a twenty eighteen pay package where the board laid out out all these really ambitious you know, market value and performance milestones. Musk, you know, at that time it was kind of perceived as this moonshot pay package. He proceeded to knock them all out, and they're now calling this next pay package a mark
shot pay package. So, you know, I think there's this This is all sort of part of a piece, right of trying to get investors to sort of, you know, focus on you know, far out there targets objectives from Musks that would make shareholders a whole lot of money.
And it comes amid you know, real signs of stress for the core here and now business for Tesla, where their sales have just really struggled this year and there haven't really been signs of of sort of meaningful change in that trend even into this quarter.
Right, So this will properly motivate him. I'm so glad you brought up the twenty eighteen pay package and some of the moonshot milestones that laid out for Elon Musk. What was the most I don't want to use the word outrageous, but the most ambitious of those milestones, And did he s each and every one of them?
Yeah, I mean in terms of the milestones there, I mean just even the market cap figures. I think you know, when when they were laid out, you know, it was it was just sort of unfathomable that, you know, a car company could be, you know, a trillion dollar company, and you know, give give the guy credit. He went
out there and made it happen. You know. I think Tesla now is trying to sort of, you know, incentivize him to turn Tesla into a company that is many multiples of even the VIDIA, the most valuable company in the world in the here and now, and yet you know, the sort of path to getting there is really uncertain because you know, you've heard Musk make these pitches about
robotaxis and about humanoid robots. But you know, he is a long way from accomplishing some of these new objectives that the board has set for him.
This must buying shares personally, is governance concerns or could it even actually reinforce skepticism about how closely Tesla's board is aligned with his self interest.
Generally, whenever a CEO or an insider of a company is buying shares, that's taken as a good thing and not necessarily you know, something to look at skins at from a corporate governance perspective. It does, however, I think it's worth sort of you know, thinking about this billion dollar purchase and context. This is a guy who's you know, sort of you know, a billion dollars can be found in his couch cushions, right he is is the top
person on the Bloomberg Billionaire's Index. He's worth about you know, four hundred and twenty billion dollars at the moment, and so you know just how meaningful this is. With any other CEO, you would look at a billion dollar Stoft purchase and maybe take you know, take real note of that with Musk, Is it that huge a show of confidence? Maybe not in the context of, you know, just how much wealth he has.
Our thanks to Craig Drudell, Bloomberg Global Autos Editor.
Keeping with Tesla, we're going to move now to door safety.
This week, US auto safety regulators open an investigation into whether Tesla door handles are defective.
And this comes after a Bloomberg exclusive saying NHTSA received complaints that Tesla's design features like the door handles are confusing occupants and first responders.
For more, Scarlett Fille and Stacey Vandock Smith were joined by Steve Man Bloomberg Intelligence, Global Autos and Industrials Research Channels.
Well, it is a very serious situations, serious safety situation. Now, first of all, there is a manual release from the interior of the vehicle. But the safety issue is that you can't manually override the electronics and open the door from the outside. Now, this is an issue that's I'm
plaguing the whole industry. It's not just Tesla, okay, and you know there's there's a number of automakers have solved the issue, and I think Tesla does need to solve this issue because you know, you know, people have died because of this problem. Here, I think from the investor's perspective, there is a solution. There is a number of vehicles.
For example, the Aldi they have actually solved that issue, and they they solved it by you know, having a double pull on the latch to actually open the vehicle manually. So I think from an investor perspective, it is an issue. It needs to be solved, and it's solvable. As you know, the trillion dollar pay package and uh and the reieration of the company moving towards AI is really getting the
investor very excited. The robo taxi is rolling out, apparently the extended the model Y is selling really well in China. So and then in Europe, where we saw a lot of decline in ev sales seems to be ticking up.
But the pay package rewards Elon Musk for thinking really big, not dealing with how to unlock car doors. In the event of some kind of problem, you say that Audi has solved this, Are Tesla engineers going to take their queue from Audi?
Possibly? Really? Yeah, I mean it's it's it's important. It's important that they solve this because Tesla, when they roll out the robo taxi, safety is an important issue for them, and it's an important issue not just for Tesla, I think for the whole industry, and it's a reputation that they're trying to build, especially you know they're they try to roll out robo taxi and you know, they want
to project themselves as a safe automaker. So I think it's going to be a priority list for for Elon Musk and the rest of the organization there.
It does also seem that that people are feeling quite optimistic about this stock, but also there's there does seem to be a liability issue in addition to a need to solve this problem issue. Is that at all concern?
Yeah, it is.
It is a liability and I wouldn't be surprised that, you know, there's going to be other legal issue that that come up. I think from an investor perspective, this is normal. Business recalls are normal and there are other safety issues that has been recall not just at Tesla, but and other automakers. So I think the investor are taking this. I don't want to say lightly, but it's normal business that we're going to get over this.
It's a work in progress. Yes, are there other safety issues in particular that Tesla needs to focus on pay attention to that could, if left unresolved, could become legal liability issues.
Robotaxi there's still a safety driver sitting on a passenger seat pretty much on every Robotaxi. I think there is discussions of taking the safety driver out at the end of the year, but I think they need to tread very very carefully, especially for Tesla. It's a high profile company. Anything negative is going to damage the reputation, and so if they don't take up the safety driver at the
end of year, I wouldn't be surprised. I think they do need to take it one step at a time and make sure everything goes well before they do a full launch without the safety driver.
Our thanks to Steve Mann Bloomberg Intelligence, the global autos and industrials research analysts, and.
Each week we look at research from Bloomberg n EF previously known as New Energy Finance.
They're the team at Bloomberg that tracks and analyzes the energy transition from commodities to power, transport, industries, buildings, and agricultural sectors. This week, look that data center Demand and R Plus north America's biggest renewable energy conference.
For more, host Scarlett Food and guest hosts Isabelle Lee were joined by Derek flackl BNEF, lead US policy analyst.
Ri E Plus and Real Energy Plus is one of the biggest conferences in North America. You see battery manufacturers, transform manufacturers, energy storage manufacturers from all over the world hawking their wares, and basically what everybody is trying to do is rush to build, rush to safe harbor in order to get legal compliance, to get tax credits in the US government before rules change at the end of
the year. Now, as a reminder, those who are following the Trump administration will recall the one big Beautiful bill, a big budget act passed to the middle of the year that has substantial changes for the way that you
can claim tax credits. If you're a window solar project, you have to get under construction by a certain deadline or you face an even harder cut off or when your project can enter service, and at the beginning of next year, suddenly you've gotten new foreign entity of concern rules that could make you in eligible for tax credits based on your exposure to mostly Chinese firms, whether through corporate ownership, through supply chains, or through intellectual property and
other agreements. You're seeing firms restructure themselves in order to avoid getting hit by those rules. You're seeing developers build up massive stocks of solar and energy storage in order to try and have equipment that allows them to claim those credits before the rules come into effect. And you also have massive growth in US battery factories and new players entering the market to try and ser more domestic demand. So you see this combination of a rush with the
possibility of a cliff afterwards. And I think everybody is waiting for new rules to come out to provide some clarity on exactly how much of the market can survive the shift.
How anxious were the companies and the executives at this event because, as you mentioned, they are moving quickly because the rules could change on them. The goalposts could change at any point. What is the one certainty that they have in operating through this uncertainty.
I think the one certainty that they have besides that more change is coming, is that there is going to be load growth in the grid as a kind of tailwind supporting the market in phase of other headwinds. Right, we all know that data centers, among other applications like new manufacturing and electrification, are causing electricity demand to rise for the first time in the US in about two decades,
and at very fast, kind of chunky rates. So that in turn means that electricity prices are going to have to go up, especially given that the tax credits that were sort of subing new power build are going away or at least being severely reduced. That in turn is going to make the economic case work out for more projects.
But that is filled with uncertainties in and of itself. Right, you have different utility markets, different states trying to change the way that power is paid for by large load customers like data centers, and where the cost falls, how many projects get built, how much public utility comissions allow given the cost increases that most rate payers are going
to see. That's a source of uncertainty even within that certainty, And so you see at riplus there was a lot of talk of virtual power plants or special timing on electric vehicle charging, anything to sort of keep the electricity system from being overbuilt because as a reminder, way the electricity system is structured is for the hottest and coldest days of the year, when there's the largest amount of electricity demand. A huge amount of cost is driven by that,
and there's extra capacity that goes unused. A lot of the time. People are trying to get creative about how you use more capacity it's already on the grid to prevent things from getting more expensive for customers, or if you do need to build new stuff, basically putting those costs on two data centers themselves. Nevertheless, there is still a key tailwind in the face of this policy uncertainty. It's just a question of what that actually means for every other customer.
Thanks to Derek Flack will be n EF lead at US Policy Analyst.
Coming up, we look at how the global sports industry is huge and growing rapidly.
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This is Bloomberg Intelligence with Scarlet Foo and Paul Sweeney on Bloomberg Radio.
Paul Sweeney joined this week by Alexis Christopher's. Franchise valuations are surging across the two point sixty five trillion dollar global sports industry, with three year analyzed growth rates running at it double digit pace across the majors.
A loosening of ownership restrictions is driving an influx of institutional capital into professional sports franchises, enabling access to a deeper pool of potential investors.
We broke down the numbers with BI analysts and Business of Sports co hosts Damian Sasauer.
Two point six five trillion is revenue generated or expected revenue to be generated just this year alone from the global business of sports. So let's put some color around it, and really it's everything from the sixty billion dollars a year that's generated from METIA rights, the thirty billion dollars in advertising spend. But if you want to take that two point six five trillion and it's recreational vehicles, it's
a parrel. It's everything. What we focus on is fan engagement, and fan engagement is roughly seven hundred and fifty billion in revenue generator per year, and there's no better mechanism to take advantage of that segment than to own a professional sports team.
But you cannot.
Everyone can own one, right they're privately listed or I'm sorry, they're not publicly listed. They're private entities. You just can't invest in them easily. So together with Brian Dougherty, get the Raganathan, Kevin Niar and the whole team here at BI, we came up with some way is that you know, your everyday investor might be able to take advantage of the opportunity set in the global business of sports. And we wrote a huge research report on it and it's really good.
We did watch your twelve minutes segment and then you said that the difference is the sports industry has limited public access.
Is that for the better?
So it's changing, So the rules changes, specifically with regard to private equity investment in the NFL. I mean the NFL is first among equals. I mean their national media deal is eleven years, one hundred and ten billion, something along those lines. It's twelve billion and average annual value per team. It dominates professional sports. But really, at the end of the day, you know what you are seeing here from some of the recent transactions that have taken
place in the private space. Talking the Philadelphia Eagles, the Buffalo Bills, a lot of these teams have sold small minority interests in their teams to private equity. It's driven the entire the entire universe higher so to put some some numbers around it, since year end alone, the average NFL team has gone up by thirty five percent in valuation.
So the top twenty five teams across all of professional sports I'm including international sports like soccer, the NFL now comprises twenty two of the top twenty five slots alone, led by the Dallas Cowboys of course, but the Jets
are up there. So yeah, no, I mean like it used to have a sparring of the yeah, right, despite their best effort, Scarlett, but you know, used to have FC Barcelona, Real Madrid, you have, you know, some baseball teams like the Yankees, Dodgers in Red Sox that used to be up there, and a lot of them have kind of fallen back due to the fact that private equity is now and allowed to invest in the NFL.
Okay, I mean private equity being allowed to invest in the NFL was definitely a watershed moment, but private equity was allowed to invest in European football clubs for a lot longer before.
We're different sport, yeah.
Very different sport.
But I'm curious in terms of the breakdown of that two point sixty five trillion dollar number, how much of that is tied to the NFL. How much of that is tied to things like European soccer.
Well, I mean it's a much smaller percentage than that, right, because I mean that two point six to five trillion that's generated a year. I mean, again, it has everything to do with recreational vehicles, the footwear in a parrel. But if you're just talking about a sports team and how they generate their money, it's just really national media rights or local sports media rights, and it's gate receipts primarily, you know, ticketing, parking concessions, the things that you pay
for when you go to an event. Right, So you know, if you just want to talk about gate receipts, I mean one hundred and sixty two game schedule for the Major League Baseball, they dominate in gate receipts, but in national media rights, which is the real animal that everyone's chasing right now. You hear about the NBA's new media rights deal F one UFC. The Major League Baseball just did something new there as well. You know, it's the NFL. I mean, the NFL is first among equals and national
media deals. It represents seventy five percent of every team's average annual value revenue that's generated every year. So yeah, you know, I mean, you know, these national media deals are huge, and now that the NBA just did its big deal, we expect that, you know, come, I believe twenty twenty eight, Scarlet, the NFL is going to re up. It has the ability to buy out of its existing contract and renegotiate it, and it definitely is going to
do that. And I think that's what's commanding a lot of these valuations because in specifically private equity investors, they see this and they want to take.
Advantage of it.
Can you talk about the revenue mix, because it varies across major leagues. I'm looking at this really pretty table you have for NFL, the biggest driver is national media.
Yep.
For NHL, and I'm eyeballing here, it's ticket sales and it seems like concessions slash parking. Who would have thought is kind of a significant chunk across all of them. What do you think will be the single biggest driver or is it really going to be different?
Well, that's only because the average franchise value to revenue multiple for the NHL is just seven point seven times. I mean, in the NFL's case, it's twelve and a half times.
NFL isn't a league of it, nothing else even compares, correct.
I mean, but you might argue, I mean, look, despite the fact that the NHL generates you know, call it, I don't know, two billion dollars in revenue per year on average, you know, it's still it's multiple still smaller than that of Major League Soccer, which generates much less. And again that just has to do with the fact that you have all these MLS valuations now on the back of you know, some great European players like Messi who are now coming to play in places like Miami.
Just try up a lot of these valuations and so yeah, you know, I mean, you know, we're still in early days. But really it's the entrance of institutional capital, Isabelle, that's really driving everything higher. You know, for the first time ever, you know, institutional investors are gaining access to these sports teams and they are looking to you know, get a high return on investment from them. And just to be very clear, you mentioned soccer before, because of relegation on
all these things. In soccer, in the fact that there's no salary cap is very very difficult to extract a profit from owning a EPL team, a European Premier League team, whereas the salary cap allows for you know, I guess better profit generation in the US. And so I think that's one element to why you're seeing a lot of the evaluations for these real Madrid FC, Barcelona come off relative to the NFL.
So owning a European soccer club is more about bragging rights than actually making money. Is that Is that what I'm saying.
I would say no, not entirely. I would say yes, it's definitely a trophy asset, but they all are. I would just say the playing field for soccer, the fact that there really isn't any way to you know, to just cap with with with Middle East money that's come
into a lot of it. You know, it's just very, very difficult to extract a profit and continue to pay these players and compete for these salaries with with the likes of you know, uh, you know, Man City and some of the others who have really really deep pocketed investors. And I think that's what's kind of skewing all the revenue generation, all the valuation multiples to the downside.
In Europe any projection or outlook on the future of esports.
So, esports and sports betting are two of the biggest drivers of our you know. So Bloomberg's created the Bloomberg equal Weight Sports Basket, which is a way that your average sort of investor can take advantage of any number of publicly traded stocks that have, you know, exposure to the sports industry. And Breed Dowerdies and her team have done a great job of developing this and sports betting and esports are wow, such a big part of it.
And esports, especially if you look at the purse from like the I'm not an esports you know, expert here, but but but Nathan n I do. My colleague in Singapore is and he said that the purse from like the World Championship of East Sports is on par or higher than that of Wimbledon. I mean, can you imagine higher than the Masters here here, I'm talking to golf here. You know, it's just amazing how much money is being funneled into that specific sort of subsector of the sports industry.
And it's growing. It's growing at a cager of like double digits over the past five years, which is just astronomical and I think there's more to come our.
Thanks to bi analysts and Business of Sports co host Damian Sasaur.
This week, Bloomberg Business Week reported in their annual ranking of full time MBA program that Stanford Graduate School of Business is again number one.
Why Stanford host Scarlettfoo and guest host Stacy Vanick Smith were joined by Demitra kesinid's Bloomberg News Senior.
Editor, Stanford came out top of our US rankings. We have rankings across regions, so it's not globally the number one school, just to clarify, but uh, you know, it certainly points to resilience and strength of the programs. Stanford, as we know in Silicon Valley, with all its focus on technollogy and entrepreneurism and more, has been very, very strong for years. You know that maybe to some degree masks some of the problems that we see that especially
in the US, but globally, schools are confronting. I mean, there are a lot of challenges today. There are geopolitical challenges, there are challenges that are more specific to the US. With what we've seen play out over several months, given the current administration stance towards international students, towards issues of diversity.
So there are certainly a lot of things that are just making tensions a little heightened right now and are really raising the level of discussion and concern among deans in a way that has them trying to come together from around the world and really think about how do we best support each other to support education, because what we ultimately are in the business of is education.
Well, clearly some of those challenges have to do with some of the some of the Trump administrations policies and stances going after certain colleges and universities. How has that factored in to business schools, to enrollment and to some of the concerns that you're mentioning that deans of different business schools are taking on.
I mean, it's starting very slowly, you know. It's not as though we're seeing some great exodus from people interested in schools in the US. We still have a very strong system of business schools in this country, also in Europe and in Asia, and there are very particular facets to each of them that appeal to students depending on
what they're looking for. But I think that international students who have come to this country in very large numbers to business schools are starting to really question whether this is the best option for them given the opportunities available elsewhere. And part of that mix also has to do with factors that aren't so specifically about the administration right now in the US, but about jobs and opportunities and growth
are schools in the US. In addition to some of the factors that they're facing that are more about some of these issues around diversity and international students, they're also confronting a situation in which, you know, more graduates are finishing their programs with no job in hand. The share of students that are finishing and that have a job
offer within three months. While it's not again a huge shift, but it is a shift we're seeing, is really it's, you know, that sort of percentage is being cut away. We've seen so many cuts in technology, We've seen cuts in many other industries that are leading. Consulting is really a big one that draws business school students historically in very large numbers. Consulting is going through a huge shift
right now, largely because of AI. We've seen many stories about this, the way it affects the work that they're doing the way that they're recruiting, how many people they need to hire. So it's affecting all schools in various ways. International programs have a lot of partnerships with US programs. US programs send a lot of students abroad. The visa issues are also, you know, very very touchy right now.
So it feels like it's on many fronts and just coming together in a way that's more sort of pronounced.
And our thanks to demetri Kecndes, Bloomberg News Senior Editor.
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