| Here's your daily business briefing. - 📈 Novo Nordisk record high on weight-loss profits
- 🔬 Deep Dive: Lab-grown diamonds account for 20% of diamond sales
- 🚂 Toy sales down 8% last year: Report
Thanks for reading! Shriram
p/Shriram | |
| 1 | | Novo Nordisk's ($NVO) shares hit a record high as the pharmaceutical company announced robust 2023 earnings, with sales surging by 36% to $33.7B, surpassing analysts' predictions. Profits nearly reach $15B, exceeding analysts' forecasts, driven by the success of blockbuster weight-loss drugs such as Ozempic and Wegovy. More: - The Danish multinational pharmaceutical company reaches a historic market capitalization of around $500B.
- Novo Nordisk and Eli Lilly lead the weight-loss drug sector with their appetite-suppressing GLP-1 drugs, driving significant weight loss.
- Wegovy, specifically, aids in a 15% body weight reduction and holds potential benefits in mitigating the effects of cardiovascular, liver, and other diseases.
- In the upcoming year, Novo Nordisk expects sales growth of 18% to 26%; however, growth may be impacted by supply restrictions and competition.
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What the numbers say: Lab-grown diamonds are 3.5 times cheaper than natural ones. Lab-grown diamonds, accounting for 20% of diamond sales, are gaining popularity, especially among younger consumers, as 75% of Gen-Z prioritize sustainability, with 71% willing to pay more for sustainable products; 5% of these diamonds are currently produced using renewable energy, resulting in a significantly lower carbon footprint than natural diamonds. Relevance: Lab-grown diamonds, driven by sustainability concerns, challenge traditional markets' affordability and eco-friendliness. While brands like Pandora and Swarovski embrace them, some luxury brands remain skeptical, influencing consumer choices. More data: Lab-grown diamonds, sought for their ethical and environmental benefits, especially those produced with renewable energy, are increasingly popular, aligning with a broader trend in consumer choices. With prices 80% lower than mined diamonds, they challenge the demand for natural diamonds, sparking ongoing debates on authenticity and environmental impact in the market. | | | |
| 3 | | Circana's report indicates an 8% sales decline in the toy industry in 2023, attributed to inflation, reduced customer savings, and increasing consumer credit card debt. Despite these challenges, the industry has experienced a $5.7B sales increase since 2019, driven by growth in average selling prices, maintaining a positive four-year compound annual growth rate in the U.S. toy market. More: - Lego continued to be well-liked, with building sets growing at the fastest rate — by $220M.
- With an increase of $31M, plush toys had the second-largest dollar gain, led by Harry Potter, Furby, and Pokémon.
- Barbie, Star Wars, and Marvel were the top toy intellectual properties (IP) in 2023, gaining from their inclusion in motion pictures and streaming media.
- Toy businesses are increasingly targeting the adult customer demographic since their fan bases have grown beyond that of youngsters.
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| 4 | | Qualcomm ($QCOM) surpassed Q1 expectations with adjusted earnings per share of $2.75 (vs. expected $2.37) and revenue of $9.92B (vs. expected $9.51B). CEO Cristiano Amon underscores Qualcomm's focus on diversifying chip technology applications beyond smartphones, targeting markets such as PCs, cars, and virtual reality headsets. More: - After two years of decline, handset chip sales reached $6.69B in the December quarter, signaling a 16% YoY increase and a positive turnaround for the smartphone market.
- The Internet of Things division's sales, including processors used in Meta's VR headsets, dropped 32% to $1.13B.
- The American chip manufacturer's automotive business in QCT saw sales rise to $589M, a 31% YoY increase, highlighting the company's focus on chip sales to automakers and suppliers.
- The California-based firm's QTL reports $1.46B in revenue, down 4% annually, as Apple extends its patent licensing agreement through March 2027.
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| 5 | | AMD's ($AMD) Q4 earnings met expectations with adjusted EPS of $0.77 per share and revenue of $6.17B, while net income rose to $667M. However, AMD's Q1 revenue forecast of $5.4B fell short of the anticipated $5.73B. More: - With a 38% YoY growth in sales to $2.28B, the data center business — which includes server CPUs and AI chips — became AMD's largest division.
- The Santa Clara-based company has increased its forecast for data center GPU sales under the "Instinct" brand from $2B to $3.5B by 2024.
- The client category, which specializes in semiconductors for laptops and PCs, had a 62% YoY revenue growth to $1.46B.
- Reduced sales of gaming consoles caused a 17% drop in sales for AMD's gaming division, which includes processors for Xbox and PlayStation systems.
- The embedded segment deals with networking chips and reports $1.1B in revenue, indicating a 24% YoY decline.
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| 6 | | The PGA Tour has greenlit a $3B investment from Strategic Sports Group (SSG) for a new commercial entity led by John Henry's Fenway Sports Group, the Boston Red Sox and Liverpool FC owner. The transaction involves an initial investment of $1.5B, with the potential for an additional $1.5B injection from SSG's consortium of investors. More: - PGA Tour Enterprises will be established as part of the agreement, which values the new company at roughly $12B.
- In the new business, over 200 members of the PGA Tour will have the chance to acquire shares.
- The investment is intended to improve the PGA Tour's capacity to increase the sport's value for competitors, competitions, spectators, and partners.
- The Avenue Sports Fund, several sports team owners, and New York Mets owner Cohen Private Ventures are among the other participants in the Fenway-led consortium.
- Discussions about a potential future investment are ongoing with the Public Investment Fund of Saudi Arabia.
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 | Freelance Writer | | Shriram is pursuing Master’s in Business with Marketing at Warwick Business School. He worked as a Senior Consultant in Tech and Political Consultancies before his Masters. He is passionate about Tech, Marketing, Strategy, Anthropology and Politics. He is also the Postgraduate Ambassador for Warwick Business School. | | This newsletter was edited by Aaron Crutchfield | |
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