Walmart Warns of Slow Sales in 2025 & Amazon Takes Over James Bond
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Good morning Brew Daily Show. I'm Toby Howell. And I'm Kyle Heggie. Today, Walmart, the bellwether of retail, warns there could be tough times ahead. And how Amazon has finally got James Bond over to their side. It's Friday, February 21st. Let's ride. ♪♪

So as you can hear, Neil is out for the day and actually will be out for the entire next week as well as he is finally taking a long deserved break, which means we have Kyle here today. Yes, thank God. Neil deserves a break. He absolutely does. So Kyle, you are from Minnesota, which along with the whole Midwest has been in the midst of a little bit of a cold snap. In fact, it was so cold this week that cloud detecting satellites pointed at the region thought that

All of Minnesota, the Dakotas, and part of Wisconsin were a cloud. The National Weather Service shared this gif of satellite imagery showing dark and light blue covering the upper Midwest, the hallmarks of clouds as seen by satellites, while actual clouds floated by over Illinois and Iowa. Kyle, there is cold and then there is cold.

satellites mistaking your state for a cloud cold. What is going on? Well, first, I just want to say I'm honored to be the MBD Minnesota correspondent. First, that is an honor. No, that's just another day in Minnesota. Parents still have shorts on. They walk outside. They go, oh, it's a bit chilly.

Let's get on our way. And you go on with your day. You go on with your day. Now let's go on with our show. A word from our sponsor, LinkedIn ads. Kyle, thank you again for filling in today. My pleasure, Toby. It was fun getting back into MBD prep last night. Felt like I was back in school again. Preparation is a huge part of what makes MBD tick. But now imagine that you are in that chair in front of the bright lights with a

No idea with what we were talking about today, just fully in the dark. As much as I trust my improv skills, that sounds awful. I would much rather know what the heck is going on. I agree, but so many people run their B2B ad campaigns that way. No prep, firing willy-nilly, hoping they reach the right people. That's where LinkedIn can help. It lets you target your audience by industry, company, and role, so you can feel prepared

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Walmart released its fourth quarter earnings yesterday and spooked the markets a little bit after it warned inflation fatigue and general uneasiness among shoppers could slow its roll over the next year. And since it's Walmart and it's huge, its tepid outlook stoked fears of a broader slump in consumer spending that affected the entire market.

Q4 earnings actually weren't the issue. Sales were up 4.6% year-over-year, topping expectations. E-commerce sales especially were a bright spot, jumping 20%. And higher-income shoppers kept piling items into its shopping carts. So why was the stock down 6% yesterday? A cleanup on aisle 2025. It projects 3-4% full-year sales growth below Wall Street's expectations and

and well under the 5.1% growth it logged last year. It called out tariffs, which could weigh on the low prices, as well as lingering inflation as two reasons why sales and profit growth could slow. Kyle, combine Walmart's tepid outlook with the fact that U.S. retail sales fell more than expected in January, and you have a rocky start to the year for consumer spending. Yeah, Toby, you mentioned this at the beginning of the show. This is like a bellwether for

I mean, Walmart is just so massive that how Walmart goes kind of the whole industry goes. I thought the tariffs were very interesting. Their CFO, John David Rainey, said, look, we're not immune from tariffs. I think it's about two thirds of what Walmart sells is made is grown or assembled in the US. But they still have products coming in from Mexico, from Canada, the tariff.

seems pretty unclear, so they didn't actually talk about that in their guidance, but that is kind of the big cloud over all of this is are things going to get even harder if tariffs come into play? Right, and Walmart is typically pretty insulated from tariffs, not only because a lot of what they source is from the United States, but also

Also, they are so big that they have really great leverage when negotiating with partners. And so usually they can skate by without having to raise prices too much. But you're right. There is just this cloud of uncertainty hanging over it right now. That being said, too, Walmart did have a pretty dang good quarter outside of, you know, kind of this...

uncertainty that they're seeing ahead. They have diversified their business a little bit. Their ad business brought in over $4 billion last year. You don't think of Walmart even having an ad business, but e-commerce is growing as well. So Q4 was great, but looking ahead is where it gets a little murky. Yeah, I think this point about the diversification of Walmart's revenue stream is actually really interesting. Global membership from Walmart, their income grew

16% year over year. That's programs like Walmart Plus, Sam's Club. Their advertising business, as you mentioned, was near about 30%. 24% increase in Walmart Connect. They have these third-party marketplaces now. They're doing pharmacy. They're doing same-day delivery. So they've really diversified, and they're kind of becoming a little bit like Walmart.

Amazon, and that's never a bad thing. Right, and which actually we should talk about Amazon a little bit. Amazon did officially leapfrog Walmart in quarterly sales for the first time. Neil and I spoke about this on the show. It wasn't official back then because Walmart hadn't reported, but Walmart reported a

$180.5 billion in sales during the most recent quarter. Amazon came in at $187 billion. So Walmart still technically leads the way in annual sales, but obviously Amazon is gaining ground there. But I do just want to zoom out a little bit because I've...

Walmart is an $800 billion business. It's a microcosm of the entire economy. So you saw that filter through the market yesterday. The Dow was down 1% yesterday. S&P 500 dipped as well. The NASDAQ dipped as well. So even though Walmart is just one company in the retail sector, it does give you a kind of a...

a lens into what they think consumers will be feeling like over the next year, and they think consumers will be feeling a little bit apprehensive. Yeah, you mentioned the Walmart-Amazon distinction. Walmart, since 2012, has made the most annual revenue of any company in the U.S. I looked at when the...

they first started tracking this in the S&P 500. Do you know in 1955 what the top company was for revenue? I assume it's some oil company. It was actually General Motors, and they made $9.8 billion in revenue. We have accelerated from there. We have accelerated.

So let's move on to the big screen. James Bond has dodged over 4,000 bullets, gone up against 20-plus supervillains, and even once had to skydive into an airplane. However, he might have pulled off his greatest feat yet, wriggling out of the stalemate between the Brock

That's right. In a new deal announced yesterday, Amazon and the Broccoli family have formed a new joint venture to house Bond IP with Amazon MGM Studios, gaining creative control.

Now, why is this news? Well, the relationship between Amazon and the Broccoli family has been contentious since 2022, with the Broccoli family viewing Bond as a family heirloom to be handled delicately and skeptical that the algorithm focused Amazon would do Bond justice. Amazon definitely didn't help themselves. They kept referring to Bond as, quote, content, which, according to a friend of Barbara Broccoli, felt like a curse word.

So what does the new deal open up for Amazon? Well, the Bond franchise, it's one of the highest grossing IPs series in history with over $7.6 billion in box office sales. With the latest Bond film, No Time to Die, raking in $775 million. Now Bond can be the crown jewel in the fast-growing media empire Amazon is rapidly building.

Toby, the real question is, are you throwing your hat into the ring to be the new Bond? Listen, I am wearing a hat. I will take it off right now and put it in the ring. You are right. This was the vision for Amazon when they bought MGM Studios. They shelled out a big chunk of change to bring that under their content umbrella. And the crown jewel of that is obviously James Bond. But they've been at this impasse with the Broccoli family because it's not just the Broccoli family had control over Bond films.

They had ironclad control. They decided when they got to make a new Bond film, who would play James Bond, whether you get remakes, whether you get television spinoffs. But it goes beyond that. They also had final say over every single line of dialogue that came in the film, every casting decision, every stunt sequence. You mentioned him skydiving into a plane. That has to go through Broccoli. Every marketing...

tie in every TV ad, every poster, every billboard, that all filtered through the Broccoli family, which is why Amazon was like, all right, we bought James Bond, but we don't have any control over what he does or how we use him. Now, through this joint venture, they do, which...

Could be a good thing because we'll probably get a new James Bond movie on the horizon but also could be a bad thing because who knows if Amazon will treat this IP properly and this is a massive win for Amazon I think because they spent about eight point five billion dollars buying MGM but then they couldn't unlock the power of James Bond and

And there was an article that came on the wall street journal at the end of last year. That was about the relationship between Amazon and the broccoli family. I read that and literally was like, there's no way they're getting this two months later. They have it, but it was very, very contentious. Barbara broccoli literally said, these people are effing idiots in reference to Amazon. And they, she said, quote, don't have temporary people make permanent decisions. So it seems like their idea was to keep ironclad control and,

I'm not sure how Amazon pulled it off, but now Amazon's in the driver's seat. Yeah, I think one of the big sticking points was the Broccoli family never wanted to spin it off as a TV series. Remember, Amazon clearly wants to. They have the Prime TV service. They want to make a James Bond TV series to just squeeze more juice out of it. But the Broccoli family is like, no, this should be a cinematic franchise. This should only live in theaters.

theaters. So I, you are right. I don't know exactly what agreement they came to. Maybe it was just a lot of pinky promises that we won't like, Oh,

overuse the IP, but here we are. I also, so Jeff Bezos wasted no time and like posting the article saying like, woohoo, it's under our control now. And he actually asked his Instagram following to say like, who should be the next James Bond? It's, you know, it's the most popular question in media to ask. And I was just scrolling through the comments and the number one name that popped up was Henry Cavill, who, you know, has played Superman, played Witcher, uh,

Which would be great, but any James Bond ideas come to your mind? Who do you think should play it? I mean, Timmy Chiaole. Put him in.

I don't know if he's got the muscles for that. I think it's funny, like, the Broccoli family being like, you have to take this serious. And Amazon's like, yeah, no, we will. And then instantly Jeff Bezos on Instagram, like, who's up? Who wants to play Bond? It's the question everyone wants answered. Let's move on. You know that awkward moment where you call an Uber, but there's four of you, so that means one has to sit shotgun down.

Well, thanks to a new app that debuted this week called Protector, the person sitting shotgun might actually be holding a gun. Protector lets you hire on-demand personal armed security guards to give you both a lift and watch your six.

According to the app, which is only available in New York and LA right now, your personal security force will include active duty or retired law enforcement officers, while your ride will be up to three Escalades or similarly sized vehicles. You can even customize your posse's outfit sim style on the app with business formal and tack

I mean, the branding is something else. I will say, personally, I'm a tactical casual type guy. That's how I pull up to the function. Um,

Look, I think they're saying their market is for people that need high-end security. The real market is people that want to cosplay as billionaires. I mean, we've seen this go viral on TikTok, actually. It's like a bunch of 20-somethings who just want to roll up with bodyguards, and it's kind of a fun thing. There was one where the bodyguards were actually going to get them matcha and coming back, so...

I think the market, what they say the market is, is not actually the market who's going to take advantage of this. It feels a little gimmicky to me. We'll see if it has staying power, I suppose. Right. One of the reasons that the app's founder said that they brought this service to market, they actually said they rushed it to market after they saw the murder of UnitedHealthcare CEO Brian Thompson. So they were clearly trying to play on some of those safety fears or safety anxieties that people might have when traveling. But if you do look at a lot of their marketing, it does.

it feels like cosplaying a little bit because usually personal security is only afforded to the ultra rich, the billionaires who actually do probably need it. Now you can get it enhanced safety as you might want to call it at a decently affordable price. So yeah, you can take a cynical look at it or you can say maybe this is providing a service to people who want it. Whatever the case is, they have clearly struck a chord. We're talking about it. A lot of people are talking about it. They've done their job on the marketing front. Yeah, I mean,

The CEO having the app and saving us, that felt in bad taste a little bit to me, saying this app would have saved this person's life. Yeah, that was a little odd to me. But the CEO of this, Nick Sarath, he has another app called Patrol. And so there clearly seems to be this market demand for additional security services, and Patrol lets neighborhoods basically crowdfund people.

extra security including like if you raise enough money you can have drones protecting your neighborhood so this idea that we need enhanced security seems to be going from individual to even neighborhood level and they're trying to capitalize on that yeah hey i mean if it makes you feel important to have more security or if it makes you feel uh more secure to have people around you you know armed then all the power to you i guess up next we got stock of the week dog of the week

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It's Stock of the Week, Dog of the Week time, where we have one stock who is like Neil, sitting on a beautiful, warm, tropical island, and one stock that's stuck in freezing cold Minnesota. Toby, I won the James Bond Skill Challenge backstage, so I will go first. My Stock of the Week is hims and hers health, which is on an absolute heater lately, starting with their Super Bowl ad, which led to a 650% surge in website visits, new customer registrations hitting all-time highs, and shooting their app up

to the number two slot in the health and wellness category on the App Store. And to follow that up, Hymnstock has had a massive gain on the news that the company has now acquired Tri-B Labs. The deal will allow the telehealth company to offer at-home blood draws and more comprehensive pre-treatment testing to its users. Its chief medical officer, Dr. Carroll, said, quote, at-home lab testing is one of the most exciting steps towards elevating the personal comprehensive care customers in this country should pursue.

So what does this mean for the stock? Well, so far, Wall Street loves the stock. Shares have soared 141% in 2025. Entering trading as of Tuesday is closed this week, and the stock spiked more than 20% in news after this deal was announced. Toby, the health and wellness space is so hot right now.

Yeah, hims and hers is riding high. It used to kind of be a one-trick pony. It had these hair loss treatments, these ED pills, but now it's very much a multi-trick pony. Less than a year ago, it started offering those compounded GLP-1 weight loss drugs. That was a big boon for the company. Now it has blood testing as well. At-home blood testing does seem to be kind of the next evolution or the next

popular thing in at-home health right now because it does give you a good insight into a wide variety of health indicators that could help you with preventative measures or just get a snapshot of your health. So I do think that we have seen hims and hers just evolve as a company, and Wall Street is clearly loving it right now. Yeah, personalized medicine, telehealth is all kind of emerging, and some of these companies are going to be big winners in the space. I do think the other bet that

that hims and hers is making right now is one, it's setting it up itself as against the traditional pharma industry. We saw that as in the Super Bowl ad. It literally was saying it took shots at the traditional pharma industry, saying the industry is priced for profits,

Yeah.

They obviously want to accelerate their development of artificial intelligence just like every single other company in the world out there. So they're saying that they're going to use part of the data they gleaned from this blood work, patient identities will be removed, to build this database of if I get a result where it shows my LDL cholesterol is this level, what does it actually mean? What does it mean across a broad swath of other patient data? So I do think that the end goal here is to

Get some more fodder to feed an AI algorithm that could help you manage your health, which is another reason why I think we saw that 20% bump yesterday. It's like there's a little bit of AI story mixed in. You've got to have a little bit of AI in the mix. Exactly. No, I think that is what is in her thing. What is our AI in the mix? And I think this is continuing their journey towards building an actual AI that can help manage your health.

Palantir is making its dog of the week debut today after weeks of being a candidate for the opposite side of this segment. The AI company best known for its work with defense agencies had a no good lousy week, dropping at least 10% both Wednesday and Thursday before paring back some of those losses. The major drops came after the Pentagon announced

it's prepared to cut the U.S. defense budget by 8% each year for the next five years. That is not music to the ears of a company that relies on government contracts for over half of its revenue. If that wasn't enough, investors also got a little antsy over a new stock compensation plan that CEO Alex Karp was granted. His new plan allows him to sell nearly 10 million shares of company stock in the next six months if he wanted to, which,

with the stock trading at a price-to-earnings ratio of 600 to 1, might be an attractive proposition. Kyle, not a name you'd typically expect to see in the dog-of-the-week column. I know, and Palantir is a really interesting company because it's like half real company, half...

meme stock, and they rely so much on retail investors. In fact, Nvidia, Tesla, and SPY, the SPDR S&P 500 ETF, they're the only stocks that have more net inflows from retail investors than Palantir. So people like on the street really love this company, although it's more of a real company than maybe the AMC, you know, meme stock craze. The other thing is,

Every meme stock company has to have like an iconic cult like figure. And Carp is no exception to that. This is someone who loves reveling in kind of the spotlight. He loves retail investors. And he says, I actually revere everyone that reveres me. And so he has this kind of like cult like reputation.

personality that people really rally around. I was going to make the same point. It shows the danger of having retail traders as your main investor base. Obviously, they can boost you to these insane highs that we've seen. Palantir was the best performing stock in 2024. Until this week, it was the best performing stock in 2025 as well in the S&P 500. But if the narrative starts to shift

those same traders can start to abandon you as well. Let's talk about the Pentagon side of things too. Pentagon's 2025 budget is $850 billion. There are plans to make cuts to that budget. The dojification of the federal government isn't ignoring the Pentagon and its gigantic budget. That being said though, Palantir does still have

Great connections in the defense industry. It could be one of those line items where when you're looking at that entire budget, you go, maybe do we need to be paying Palantir X amount of money for this service? So who knows if the fears are overblown? Who knows if it will actually be affected by those cuts? But just looking broadly, it's not good to see cuts

to the defense industry's budget if you are a Palantir shareholder. It's interesting, though. I actually think Palantir is much more well-positioned to withstand those cuts than maybe some of the old legacy companies. And, you know, you mentioned the Doge-ification of the government. Proximity to Elon Musk is

maybe important. Peter Thiel has been, was a co-founder and is on the board of Palantir, who's great friends with Elon Musk. And so it feels like this is actually a company that would benefit from reduction from the Department of Defense because they are a little more forward leaning. They're a little more focused on efficiency. They're a little more innovative than some of these old players. So this could actually be good news for Palantir going forward.

Now let's sprint to the finish with some headlines you may have missed. Up first, the IRS is getting slimmer today. The agency began laying off roughly 6,700 employees, over 6% of the agency's workforce as of yesterday. If you still don't know where the good bath

Thanks for watching.

Cuts aren't expected to include workers essential to the filing season. Yeah, I mean, the IRS is in a tough spot also just with general attrition. And 63% of the current IRS is eligible to retire within six years. So more cuts, morale is low, people might start retiring. It might not be good news for our refunds getting here on time. I know. So as of February 7th, the IRS had received and processed about 23.5 million individual...

That was down about 8% from the same time last tax season, which might show that there is some buildup happening over at the IRS with some of these cuts, some of these uncertainty. It might be a headache season that is...

brewing upon us right now, especially with these cuts, you know, coming down the line. Yeah. The termination memo read quote, your continued employment at the agency is not in the public interest and quote, which that's a savage way to, to go out, moving on to the great U S Canada war of 2025, AKA the four nations hockey tournament. Now, if you haven't heard of the four nations hockey tournament and NHL best on best tournament featuring players from Sweden, Finland, Canada, and the U S well,

You probably saw some of the clips on social media. National anthems getting booed, fights breaking out on the ice before fans were even in their seats, and tweets about Canada becoming the 51st state or the U.S. becoming the 11th province. Well, Canada was declared victorious last night after a 3-2 victory against the U.S., but the bigger story was just how electric this tournament was and how

the demand for tickets, whose prices rivaled those of the Super Bowl. The cheapest ticket was, at one point, hovering around $1,200, according to reseller TickPick. That's roughly 450% more expensive than the initial price for the ticket when this in-season NHL tournament was announced. Some of the games also drew 10 million-plus viewers across North America.

Toby, since the U.S. lost, I think Morning Brew should have to tweet in English and French all of next week. I agree with you. I mean, these games are important to talk about, not just because they'll pull in those gaudy viewership numbers, these gaudy ticket sales numbers. What it's also important to talk about is the geopolitical undertones to all this. Trump said on Truth Social before the game that he called Team USA, and he repeated that phrase that he loves to say about making Canada our cherished heritage.

and very important 51st state. But then after the game, once Canada won, Canadian Prime Minister Justin Trudeau fired back on X saying, you can't take our country and you can't take our game. So there is clearly, I mean, I'll call it chippiness because it still is sports at the end of the day. But just with the tariffs, with these conversations, with the way Trump talks about Canada, there's clearly some undertones of,

you know, unrest and unease between these two countries. It just stinks that we lost. I really wish we won. The tension made the on ice game a little more electric. And also these like in season tournaments now are really catching on. The NBA did it. Now the NHL is. So maybe more sports will get into that tournament mode too. Finally, just when you thought it was so over for discovering tombs of ancient pharaohs, suddenly we are so back.

back. Egyptologists announced the discovery of the first tomb of a pharaoh since King Tut was uncovered over 100 years ago. The tomb belongs to King Thutmose II and was the last undiscovered royal tomb of the 18th Egyptian dynasty, according to the BBC. An archaeological team actually discovered the entrance to the tomb back

in 2022, but thought it belonged to the wife of a king. But when they finally got inside, the tomb was decorated to the nines, which is a sign of a pharaoh. The fact that we're still discovering tombs a century later, Kyle, pretty cool. Yeah, and one, I wish I knew that Egyptologist was a job when I was growing up because I

Sign me up for that. Two, I think we've got to stop digging around. I've seen The Mummy too many times. Great movie. I'm a little worried that some spirits are going to get out here. That is a hot take. I just think it's cool that we still are finding these things. I mean, you saw that it was like a mistaken identity. They thought it was just one of the reasons they thought it belonged to the wife of a king was the location. They were saying, I don't know, this location was not very good. It was situated beneath two waterfalls. It was down at the

bottom of a slope. So they're like, all this water was flowing through this tomb over the years, especially it was a little wetter back during the time of the 18th dynasty. So when they got into the tomb, it was not in good shape. There's a ton of water damage, but they did find some fragments of alabaster jars that had inscriptions that showed the name. It talked about the deceased king. And yeah, I guess your team, uh,

Don't go mucking around because of, you know, evil spirits. I'm team. It's pretty cool that we found a new tomb. It is cool that we think we've discovered everything on earth, but there's still so much more mystery out there. So I'll give you that. It's pretty fun.

fun. All right. That is all the time we have for today. Kyle, thank you so much for stepping in and being Neil. You crushed it as always. Let's roll these credits. Emily Milliron is our executive producer. Raymond Liu is our producer. Olivia Graham is our associate producer. Uchenna Naogu is our technical director. Scoops Dardaris is on audio. Hair and Makeup is on vacation with Neil. Hope it's not a white lotus situation where tragedy strikes.

Devin Emery is our chief content officer and our show is a production of Morning Crew. Have a great weekend, everyone, and we'll run it back next week.