NYC Mayor Adams Plots Comeback Off Of Mamdani's Win
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With Carol Masser and Tim Stenevek on Bloomberg Radio. A Republican plan to cut $250 billion in Medicaid and other health care spending hit a procedural roadblock in the Senate today. It complicates efforts to pass Donald Trump's massive tax and spending package. We go down to Catherine Lucey, Bloomberg News White House correspondent. Catherine, is this bill at risk as a result of cutting $250 billion in Medicaid?

This certainly slows this bill down. It certainly complicates it. As you said, what's at issue here is a plan to cut $250 billion in Medicaid and health care spending that the Senate parliamentarian has said they can't move in this bill, what the process is that they are doing here. Leaders are saying that they have plans, they can do this.

And I think they are looking at ways to refashion this, but it does take time to rewrite legislation. It does take time to do this and to keep...

a sort of combative group of Republicans on board. So trying to keep everyone rowing in the same direction is an issue. That said, the event at the White House today is Donald Trump trying to do just that. He is trying to rally support behind this bill. He is aggressively pushing for it to be passed by July 4th.

he is personally lobbying for it. And so I think he's going to pull out all the stops to try and make sure that this happens. So,

So what's the time? What does this do to the timeline? Right. That's what everybody we know that there's a lot of pressure, Catherine, on the president in the next couple of weeks to get a bunch of stuff done, including trade tariffs and, of course, his tax and spending bill. So what's the timetable if there is a rewrite? How do they do it? You're right. That's complicated. It's complicated. You know, they are now working to do this. We'll have to see how quickly they can come up with a new version of it. I mean, I think

You guys know as well as anyone that Congress never does anything until they're up against a hard deadline. So things do happen when they feel like they're just like against the wall. I'm so deadline oriented.

So there is a little bit of that, but I think you are really going to see an aggressive effort by the president who really wants to do this by July 4th. And we'll see if he can make it happen. But it is, I mean, this is his main legislative focus for this term. This is his top legislative priority. And he and Republicans really think that they need to pass this to have something to run on next year in the midterms. So it is a top priority. All right. Good stuff.

We wanted to check in and find out what kind of where we are on this. So really appreciate it. Catherine Lucy, she's Bloomberg News White House correspondent joining us from our bureau in the nation's capital. Well, from the nation's capital to the financial capital of the world, we are, of course, talking about New York City, where Andrew Cuomo's loss is Eric Adams gain. Just days ago, the New York City mayor faced steep reelection odds, but Adams was

who dropped out of the campaign as a Democrat to run as an independent, is suddenly looking less toxic to a class of moderate voters. Laura Namias is a Bloomberg News New York politics reporter. She joins us here in the Bloomberg Interactive Brokers studio.

Laura, you were on with us earlier this week and you said, don't count out Eric Adams. Right. Essentially. And that's what the strategists have been telling you. But I think a lot of the public had said, you know, after the challenges he faced and him dropping off the Democratic ticket, he's kind of done. He's not so done now. He's not so done in part because of the drastic underperformance of Andrew Cuomo in the primary. I think that's

Toward the end there, Cuomo backers were maybe expecting the race to be close. They didn't expect Andrew Cuomo to be losing on the first ballot in this contest, but

By more than six percentage points, a gap that's likely to widen next week when all of the ballots are fully counted, despite the fact that he had an insane money advantage over every other candidate in the race, including a twenty five million dollar super PAC backing his candidacy. So they're wondering if he couldn't win this, can he win the whole thing? And should Cuomo drop out?

and consolidate behind a different moderate candidate, maybe Eric Adams, so that he doesn't play spoiler and hand the election to Mom Donnie or a Republican, Curtis Lewo's running on the GOP line. Laura, Eric Adams looking less toxic is still toxic. So I'm just curious, like how that plays politically. So that remains to be seen. We haven't seen four

polling that's nonpartisan post-primary, but the most recent poll numbers for Eric Adams are terrible. He was polling in the teens. His favorability in New York City among voters was in the teens. Like 70% of New Yorkers disapproved of the job that he was doing as mayor as recently as a month ago. So, yeah,

It's not an easy path to victory, but there's some thinking that maybe if people are disenchanted enough with the idea of a Mom Donnie candidacy, they could get behind an Eric Adams one. Have you heard anything? So there's this the supporters of former Governor Cuomo. Yes. And we should note that Michael Bloomberg, the founder of Bloomberg LP, the parent company of Bloomberg Radio, did support Governor Cuomo ahead of the primary. Do supporters of have any supporters of Governor Cuomo support?

come and said, wait a second, we can now support Mamdani? So here's what's going on. Donors are having a conversation. There are also some powerful backers of Andrew Cuomo, who are labor unions. And right now, conversations are happening with labor unions about who they are going to pivot toward backing in the general. And we are hearing from some sources that it's likely that a lot of them are going to coalesce behind Mamdani. Their agenda...

largely dovetails with some of the things he said he wants. That's very different from some of the donors who backed Cuomo who are in finance or real estate, who are seeing some of Mamdani's policies around rent control, around taxes as like an existential threat.

But those conversations are happening right now. It's fair to say that a lot of conversations are happening and that there's maybe a panicked air to some of the conversations that are going on right now. It's likelier that the unions might back Mamdani than some of the big money backers. Yeah, no, that's really fascinating, right? Like, you know, where there's politics, there's money. And where there's money, there's politics. But it's just like you do wonder if ultimately Cuomo is out and

What's the assumption about a lot of those, a lot of the political donations, does it automatically go to

to Adams. We could see. So in 2013, if people will remember back then, Christine Quinn was the favorite of moderates and a lot of people in finance in the Democratic mayoral primary. She lost. Bill de Blasio ultimately won. There was an effort to consolidate support behind de Blasio because it was thought that he was going to face a competitive general election against Joe Loda, the Republican at the time. And a lot of people got behind him.

behind de Blasio, and they also sort of talked to him about moderating his positions, about his nominees and who he was going to bring into his administration. And there was this sort of a moderating force by people who had backed his opponents getting behind him at that point. Well, speaking of backers, prominent backer Bill Ackman, who was one of the most prominent backers in the Super PAC supporting former Governor Cuomo.

He has a very long post on X, which is pretty typical for him. He writes very long messages on the platform. And he writes about...

crowdsourcing the next candidate. He's really worried about Mamdani. He said, who is your best centrist candidate who could go toe-to-toe with Mamdani on the campaign trail and on the debate stage? Let's crowdsource the names and then do a poll. If someone is ready to raise their hand, I will take care of the fundraising. Is it that easy? It is definitely not that easy. This is a little bit of inside baseball, but after tomorrow, Amherst

Andrew Cuomo cannot get his name off of the November ballot. He's running on an independent line that he set up in case he lost the primary, which it looks like he did. After tomorrow, if he doesn't decline that nomination, it's impossible to get his name off the ballot. The ballot is basically set.

Those are really significant events. You don't want to force someone to die.

die or move out of the state or go to prison. So it's just not that easy. It's not a question of right candidate plus right money. There's rules, you know, in elections and they've been said in advance. I'm just going to say, favorite quote of the day. We got to put that one and send it out. It's still early. A lot can happen. Oh, yes. I mean, I think three months ago, if we were having this conversation, I

Nobody in the general public really knew who Zoran Mamdani was. And now he's looking like the next mayor. That's all we're ever talking about right now. Possibly of the city of New York. Anecdotally speaking, I live in South Brooklyn. The ground game that Mamdani had was unbelievable. I would get notifications, Carol saw them, of like door knockers coming over to talk to different members of our building and say,

It's kind of wild. Like he built something really from the ground up. Do we see that happening during the general election from now until November? Does that continue? I, for him, I think that that's plausible. Uh, it's too soon to say what will happen for the other candidates who are in the race.

Curtis Lewa, there's independent Jim Walden, an attorney, and Eric Adams, of course, running on his own ballot line. You know, we can't predict the future. But this enthusiasm that Mamdani had and actually this sort of managerial competence that he did show in getting this campaign organization off the ground and ultimately looks like winning this primary is nothing to be trifled with. It's a serious operation. He had a huge get out the vote effort. And the data is really showing us that he was able to

convert people who had never voted before into voters in a New York primary, usually a very low turnout affair. He has shocked everyone. That's a big deal. Yeah. An indication that we would assume that that interest is going to carry all the way through or depends like who's left in the race, right? Yes, definitely.

I don't know. You're the New Yorker. What's your last question? It is. Yeah. I mean, I'm just I'm still blown away by the ground game and the interest. He was seen as somebody literally 12 weeks ago that didn't have name recognition. Yes. And he also really lacks managerial experience or much experience in Albany to be.

Yes. His opponents made on the debate stage. Right. But he has been saying, and I think people are really starting to take this more seriously now, that his biggest qualification managerially is look at the campaign that I've run. Correct. Which built up from nowhere to more than 20,000 individual donors, tons of volunteers that converted enthusiasm into actual votes, a much more difficult thing to do than it looks like.

And there's a leader and then there's all the people that are around him too, right? It's not just the one. I mean, obviously the candidate first and foremost, but it's his whole team or her team. Laura, thank you so much. Laura Namias, keeping us informed on New York City politics. She is Bloomberg News, New York politics reporter. Hey, it's Ryan Reynolds here for Mint Mobile. Now, I was looking for fun ways to tell you that Mint's offer of unlimited premium wireless for $15 a month is back. So I thought it would be fun

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There's a lot we want to talk about with Mark Morial. Yeah, we certainly do. He is, of course, president and CEO of the National Urban League. It has called itself the nation's largest historic civil rights and urban advocacy organization devoted to empowering communities and changing lives since 1910. He's also a former state senator in Louisiana and the former mayor of New Orleans when he was elected. He was the youngest mayor of New Orleans in 50 years. He joins us from Atlanta. Hey,

That's where we want to start, Mark. First of all, great to be talking with you again. Thank you. Great to be with you this afternoon. Well, thank you. You were 36 when you were elected mayor, if our math is right. Age. How is that? Like, how do you, I don't know, when is age maybe a problem for someone? When isn't it not? So every 36-year-old is not the same. Age sometimes gives you energy, a willingness to innovate.

But the question is really a question of maturity and the ability to deal with a difficult and demanding job, pressure on all fronts, and the ability to make decisions under pressure. So age can be both an asset, but it also can be a liability if you've never experienced pressure, you've never been in a decision-making position before, and then all of a sudden you find yourself leading a major American city. So, you know, the jury is...

is out. It was out on me when I first got elected, although I had a political career as a state senator and a very successful state senator who had passed at that time some 50 bills and a career as an active lawyer doing a lot of high profile cases. So when I got elected, certainly the city of New Orleans was in a great crisis.

of murder and police corruption and economic stagnation for the for the busting of the oil bust. And, you know, I think at the end of the day, I proved all my critics wrong and and had an incredibly successful career.

turning the city around in those days. So, you know, in the New York situation with Mamdani, you know, he is a new face, not a very well-known face, but pulled off a very important and spectacular upset. But 44 percent of the Democratic primary

does not achieve a consensus of New York voters. And there's a general election ahead. And I think although he has momentum, I don't think he can pop the cork and say, I'm going to be the next mayor just yet. What do you think it's, that is so clear. And we had a conversation with one of our colleagues here, Laura Naimis, earlier in the day about the challenges that he still faces, Laura Naimis. You know, Mark, the question that I have for you

is a bigger question about the Democratic Party and what this says about, if anything, if this says anything about the identity of the Democratic Party on a national level, can you extrapolate from New York City? Some people want to focus on this sort of what I call an ideological distinction between progressives and moderates. I think maybe one way to look at it is that there may be a generational difference

that this represents. In many respects, a younger candidate who ran an aggressive grassroots campaign and used the tactic to social media, running against candidates who ran more traditional campaigns that focus heavily on television and indeed endorsements. And so underneath that for Mamdani, he has to demonstrate that

that he can expand his coalition. He has to demonstrate that he can govern. Govern, right? Govern is not an ideological thing. Governing does bring into play one's values and one's philosophy, but the mayor is the local chief executive officer.

Basic services, public safety, education, the condition and cleanliness of streets and neighborhoods, affordable housing. Those are the issues. It's not a job of foreign affairs, although because it is New York, there are global issues that the mayor of New York has to deal with. So to me, one of his challenges is can he

expand that coalition in an effort to win a general election and build the kind of coalition it will require to govern. I can say this. I learned that getting elected

I had a decisive win, but I had a win in a somewhat racially polarized situation. I got 95 percent of the African-American vote at the time. I got less than 10 percent of the white vote. I had to expand my coalition, hold my base, but expand my coalition to be able to effectively govern.

Get things done. Make things happen. Reform the police. Expand youth services. Put together a coherent economic development plan. And that indeed is a challenge that is in front of him. So I think people need to watch his early moves and what he does. But Andrew Cuomo right now is on the ballot in the general election. Eric Adams is on the ballot in the general election. There's a Republican candidate on the ballot in the general election. And as I understand it, in the general election, there's no ranked choice voting.

So ostensibly someone could get elected with, you know, 28 percent of the vote in a general election in a four way general election. So it remains to be seen. You know, the Democratic Party, like the Republican Party, is a coalition. I think that using the term party may be outmoded and outdated and for it to achieve success.

in local elections like mayor of New York or mayor of Philadelphia or mayor of Chicago or mayor of Detroit, may be different than what is required in a national election. So someone that may be successful in a New York where there's a strong progressive base may not be. And so I don't take the mayor of New York or who wins the mayorality in New York as

as a stalking horse on the Democratic Party on a national basis. It never has been. It wasn't that way with Mayor Bloomberg, who was a Republican-turned-Democrat. It wasn't that way with Mayor Koch or Mayor Dinkins or Mayor Adams, even though they may have said, I'm the future of the Democratic Party. I don't think who the mayor of New York is represents necessarily the future of a party

that exists in 50 states and what may happen in a national election. But having said that, like the Republican Party has to unite its far conservative wing and its more moderate wing,

A Democratic candidate running nationally in a presidential election has to do the same thing. Well, we should point out right now we are talking with Mark Morial. He's president and chief executive officer of the National Urban League joining us remotely. At the same time, we're keeping an eye on the

on Washington, D.C. and the White House specifically, where Republicans are gathering as they expect the president to participate in what his press office calls one big, beautiful event. So we do assume he is going to talk about that spending and tax bill.

that he is trying to get through in the next couple of weeks. So there's some pressure on that. And we also do have some earnings out that have crossed the Bloomberg. And we're talking about Nike and that stock, Tim, we are seeing it trend a

A little bit lower right now in the aftermarket, down about 1.5%. Yeah, the company did report revenue for the fourth quarter that beat the average analyst estimate. The estimate was for $10.7 billion. It came in at $11.1 billion North America revenue.

was higher than analysts expected. EMEA revenue came in at $3 billion. That was higher than estimates. Greater China revenue came in right in line with estimates at $1.48 billion. We're going to be speaking with Poonam Goyal of Bloomberg Intelligence a little later to break down these Nike earnings. Yeah, it does seem like investors are trying to make sense of it because the stock has been down a few percentage points. Now it's relatively flat, but still a little bit lower. So we're going to continue to track

track it, we should point out that the company did say the results are in line with expectations, but not what we want. Yeah, this is really interesting. Elliot Hill in the press release saying our financial results are in line with our expectations. They are not where we want them to be moving forward. We expect our business to improve as a result of the progress we're making through our win now actions. Yeah. So kind of interesting. I will point out

that the gross margin was 40.3% versus 44.7% a year ago. The estimate was 40.2%, so it did beat that. But again, and now the stock's up about half a percent. So continue to track that, watching and waiting for the president to make some comments. And we're talking with Mark Morial, president and CEO at the National Urban League. And Mark, we are awaiting comments from the president. When it comes to this massive spending and tax bill, what do you want to see?

Well, I think it's clear that this bill is in somewhat trouble. The polling is two to one against their number of Republicans in the Senate and many in the House who I think have become less enthusiastic about deep cuts to Medicaid.

veterans programs and other programs. And they're hearing from their constituents, I think, because there's been an aggressive campaign to educate people. My sense is the more people learn about the bill, the less likely they are to support the bill. And most of the polling shows that Democrats and independents, and maybe 25 to 30 percent of Republicans, are not in favor of the bill and would like to see

them sort of scrap it, go back to the drawing board and put something together that's better and that may be able to achieve some bipartisan support. The great concern I have is the deep cuts to programs like Medicaid, the deep cuts to workforce, job training and education and the potential recessionary impact. Data I've seen shows that there would be layoffs, that there would be holes blown

into the budgets of many states, Louisiana, Mississippi, Alabama, and Georgia, to name a few. If Medicaid is cut, it would damage them fiscally in a really, really severe way. So I think the president with this today is trying to rally support, trying to play a bit of catch-up in an effort to demonstrate to the Congress his strong support for the bill. But that

runs counter to what the American people are saying. And now this bill is too much on the cut side to pay for tax cuts that benefit only a handful of people. That's really the misbalance here. And they could do a better job. They could come up with a better package. Congress has achieved consensus packages in the past. And I think that's what's in order today. Mark, when you when you look at the bill,

The president, by the way, speaking right now, and again, we'll bring you comments if he does make comments that are really focused on our investing audience. As you mentioned, he is trying to garner support for this. In your view, do you think that the bill in this current iteration will become law?

No, I do not. I think the margins right now with the changes that are being made in the Senate in an effort to put the votes together, the bill yet has to go back to the House of Representatives if it does pass the Senate. And it passed by one vote in the House the last time. So there will be an effort to get the House to accept

the changes that the Senate made, but I think this bill is in precarious shape. And I do not think that it will ultimately be passed in its current form, although there's going to be a great effort to do so because, you know, politicians, I'm a recovering politician, you know, think long and hard about the impact of a vote, one, certainly on their constituents, but two, on their reelection. And I think if Swing District

are as Republicans think that this is gonna really make their reelection difficult and hard, may say I've gotta push back for a better deal because that is in my best political interest.

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I did want to bring in Wayne Sanders. He's Bloomberg Intelligence Senior Defense Analyst. He's a former colonel in the Army. He's got a keen knowledge of intelligence analysis, information technology, counterinsurgency, and more. Wayne, good to have you back with us. Thanks for patiently waiting. Things are a little off schedule, thanks to comments that we took from the president a little earlier. Speaking of Washington, D.C., though, we did hear from the U.S. Defense Secretary earlier today

He took aim at press coverage of a preliminary assessment by the Defense Intelligence Agency that the U.S. attack likely didn't cripple core components of Iran's uranium enrichment program at the underground Fordow facility. The president has said the facility was, quote, completely, complete and totally obliterated. In your experience, do we have to wait?

For a battle damage assessment to understand the full extent of damage in a situation such as this, or can we take comments that we get through the press, from leaks, from the president, from other sources? Can we take those at face value?

Yeah, it's a great question. And thanks for having me back. I think that for the for the president, when he said that, right, when you're actually when you watch the video that was part of that press conference this morning, it was it was pretty definitive that there was a lot of damage. But it's once we talked about it before, you're 300 feet down.

And so it's very difficult to see what kind of damage that specifically is. And so when somebody puts out this preliminary assessment, right, I used to be an intel guy. I used to do battle damage assessment for the Army. And so that initial report that comes in, you have a very limited amount of information. And so you normally look to try and corroborate all that. You look for signals intelligence, human intelligence, as well as as well as imagery intelligence in it.

And there are others as well. You try to put all those together and corroborate what it is. And that's why I think that Secretary Hegsath was really trying to push and say, stop trying to jump directly to what we said originally. That was the initial assessment. And then let us be able to do as much as we can. Let the intelligence community do what they're supposed to do and provide a better assessment. So even with DIA putting out what they had, that was from a leaked perspective. We don't know when that initial assessment was made.

A secondary piece of that that's really important is a lot of battle damage assessment that's normally done is normally classified. So in terms of what the public normally gets a hold of, what normally comes out, that is normally something that is almost like pared down based off because you're always trying to protect sources and methods of how you found out that information. So here we are doing the math here. What, six days since the U.S. attacked Afghanistan?

um, those sites, the nuclear sites in Iran, how long does it really take Wayne to get a really accurate picture? Or maybe you never get a fully accurate picture, but a mostly accurate picture of exactly what happened.

Yeah, the pieces start to fall into place a little bit over time, right? I think that the chatter that comes from signals intelligence, right, as well as the human source network that provides some of that intel, some of that does take time. I was working, I was working National Security Agency, U.S. Cyber Command, all the way back when the bin Laden strike. And the funny part about that is, is that we were still getting, we were still getting reports, even three weeks, a month, two months after bin Laden was killed, that there

that he was that he was alive you know that there was this one piece of intel that came up that was that way right that's why you always look and it's so important to corroborate what that information is if we put out a piece of news we put out a piece of intel that says says a

If it then goes and the UK picks up on it or another one of our allies and says, hey, I've got this piece of reporting. If they end up reporting on that, somebody might grab it and think that's too corroborating piece of information. But somebody is just reporting off the original. And so that's a very dangerous thing. And that's why you heard the chairman. You heard General Kane talk about reporting.

allowing the IC to do their independent assessment. That's why CIA has one versus what the DIA had. And I know that's why Secretary Hicks is bringing that up. So what's, you know,

interesting times. I mean, there was a lot of criticism at media, media reacts to what gets leaked. Right. And, and that's what we, that's what we do. And we are supposed to be responsible with it and, you know, do our own reporting and check it out, but we're also there to ask questions. So, you know, I mean, obviously somebody leaked it and put it out there. So, I mean, I'm just trying to understand, you know,

are they right to be so defensive and critical or this is just kind of how it goes? Not the first administration where stuff gets leaked.

No, absolutely. The biggest thing there is we call it raw intelligence, right? If it is unanalyzed data at that point in time, data becomes information, information becomes intelligence, intelligence becomes decisions. So that's just the way that the military mindset looks. So if you're at that data layer and you have something that's leaked, that's still at that raw unanalyzed,

unanalyzed data, then it's important to know where that is in that. So when it comes to a leak and it's something that we can't completely substantiate in terms of an actual report that's been put together, that's why the intelligence community takes the time that it has. It's why there are safeguards in intelligence directives that are in place as to when you want to publish a report, you have to go through a lot of different pieces to make sure that you're not providing misinformation to the American public.

Well, so in this environment where there's a lot of tensions between Republicans, Democrats, and so on and so forth, or the White House and members of press at large, I mean, what we need to do is just kind of then be smart and maybe possibly would have been better to say, listen, guys, it's raw data. So just understand that. It's out there. We've got to deal with it. We're just going to let you know it's raw data. And we all know raw data can have flaws. And that's kind of the point right here. Because we just think about our audience and we're saying...

The end game is to understand what are the enrichment capabilities, nuclear enrichment capabilities of Iran. That's the end game, right? And so that's what all these questions are all about, ultimately. Yep. No, absolutely. When you're trying to put that together...

The other piece of it is, hey, the intelligence community never stops. They are going to continue to look. Last time we were talking about whether or not they moved any of the fissile material to another location. The intelligence apparatus of the United States never sleeps. It never sleeps. So they are going to confirm or deny everything that is out there with every piece of intelligence collection that's underneath the U.S. arsenal.

Okay. Next step. I want to ask about the enriched uranium. Okay. Because yeah, well we heard we exactly, we don't know. Well, do we know where it is? Do you think the U S government actually knows where it is? Because it's,

They seem confident in some comments that we've heard from officials that it was not moved out of facilities. So so that that's the difference, I think, between commercial capabilities and military capabilities as well. Right. So I trust I trust the military leaders. I always have. Obviously, I think that they've they've earned that respect. They've earned that trust. And so when when you look at the difference between it, that intelligence, those intelligence apparatus, all the pieces of information that they have,

in terms of what they're doing and all that. They're not going to come out and make an assertion unless they're able to back it up. So

So I would trust that side a little bit more when it comes to that, because they they have no political agenda involved in being able to do that. Right. They want the truth because at the end of the day, they provide the commander in chief and the National Command Authority. They provide the president with options. They provide him with the latest and greatest and says, here's the situation and hear your military strike and response options.

based off of that. There's no reason to try and skew the numbers or anything of that nature, because at the end of the day, then you're making a decision off of bad intel and nobody wins there.

All right. We're going to have to leave it there. It sounds like, you know, we all got to be a little bit patient and wait for more of the intel to come in. Hey, Wayne, thank you so much. Always walking us through exactly what's going on so that we have a better understanding. Wayne Sanders, Senior Defense Analyst at Bloomberg Intelligence, joining us once again from Maryland. You're listening to the Bloomberg Businessweek Daily Podcast. Catch us live weekday afternoons from 2 to 5 p.m. Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Businessweek.

business app or watch us live on YouTube. Hey folks, let's not forget we've still got some earnings and we did have Nike crossing after the closing bell. Stock down about 2% in the aftermarket. Let's get to our Poonam Goyal who follows Nike as well as e-commerce, athleisure, excuse me, and off-price retail. She's there in our Princeton Bureau BI headquarters. All right, Nike's down. It's been bouncing around. Poonam, what do we need to know?

You know, the numbers were better than expected, but the issue here is the inventory was just flat and we expected inventory to be down more. You know, if there's one thing I'm looking for in this turnaround, it's that they rework their inventory levels down to get aligned with sales. So when sales are down double digits and inventory is flat, it's still a problem. Explain why you want inventory down.

Well, they have a lot of inventory that's old and aged, right, that they just need to sell and get rid of so they could introduce more new product that resonates better with shoppers and can drive more full price sales. There's a lot of old inventory in the pipeline. They've talked about it. They need to bring it down.

I was surprised with sales doing better that inventory isn't actually down a lot more. So really, you know, the question going into this call in just 10 minutes is that what is the mix of this inventory? Is the inventory higher because you have a lot more new stuff now in it and a lot of the old stuff is in fact gone? Or is there still too much of the old stuff?

Right. Doesn't everybody want the snow for what is it? The sneaker loafer? I mean, isn't that the big thing? The $500 one? Yeah. Yeah. That's like the big thing. Why is it so expensive? Hey, it's not. It's $155 when they actually drop it. I believe if that's the right price. These are resale prices, right? These are resale prices. These are resale prices. So, you know, the resale prices are what they are. Just look up the Nike ticker, snow for S-N-O-A.

F-E-R, like a loafer. Snowfer. Snowfer, sneaker loafer. Yeah, we get the cross between sneakers and high heels, right? I forget, right? So we get that, but the guys get the snowfers. All right, so it does. So what's the number one question you want to be asking about the inventory? What specifically? Or is it just as simple as like, why is it still so high?

It's actually the mix of it, right? So inventory, they're just flat. How much old inventory still needs to be cleared? How much of it have they cleared, right? So have they cleared half of it by now, three-fourths of it, a fourth of it versus where they were last quarter? Just to get a sense of,

Yeah.

But are they seeing any demand fall off from consumers or consumers falling back? That's all uncertainty. We'd love to hear sentiment around new launches, new product. The basic questions aside from that. Taylor and I were both drawn to this headline in commentary from Elliot Hill, the president and CEO of the company, who said, well, our financial results are in line with our expectations. They are not where we want them to be moving forward. We expect our business to improve as a result.

of the progress we're making through our Win Now actions. Matthew Friend, the CFO and EVP, also said that the fourth quarter reflected the largest financial impact from our Win Now actions. Remind everybody what Win Now means for Nike investors. Yeah.

So this is a strategic plan to get Nike to come back to growth, right? So when you think about all the actions that they've taken, the inventory reductions, staffing reductions, the investments in technology, creating efficiencies, etc.,

I think what they're trying to say is we've done a lot of that. And now here's the path forward. The headwinds will be fewer. And now they can actually start to push the pedal to accelerate into growth. So the dirty work is kind of done. All right. So...

massive company, $92 billion market cap, stocks down 17% year to date. It used to be a bigger market cap. It did used to be. And I feel like Poonam, we've been talking about their struggles for a while. I mean, is Nike's heyday over or they just have to kind of figure out the inventories and get their groove back?

Their heyday is not over. We actually ran a survey just probably a few weeks ago that published this week. And it asked people, just surveyors, a thousand people, this common question, what do you want to buy in the next six months? And the number one response when you're buying sneakers was Nike. So Nike still is very, very visible with people in the U.S. for sure, because that's where the survey was run. But I'd say even around the world, it's still the largest athleisure brand.

I believe that if they can fix their inventory position and really focus on product, which I think Elliot Hill is doing, and that is what he came in for, I think they can win back customers as long as they can stay on top of innovation, true to their game, true to sports. Because Nike is a sportswear company. Yes, we'd love to see more snowfurs or, you know, those kind of things. But at the end of the day, it's a performance company.

Right. And I think they have to stay true to that. I don't know if you do this. I'm sometimes in the subway and I'm just kind of looking down. And of course, all you see is feet. Right. If you're sitting or standing. And like, I kind of count like what the brands are. There's a lot of on sneakers I have on full disclosure. But I do. I try to get an idea of like what people are really into in terms of what they're wearing on their feet. I know I'm strange. What can I tell you? I do that, too. So you're not. You guys are both analysts. That's the way. I'm in good company.

But here's the thing. No, just to get an idea. Poonam, I think it was like a year ago. And I look at ages, too, to see who's wearing what. Well, wasn't it like a year ago or maybe two years ago that analyst went to Central Park and he actually looked at who was running and what? And that was a big issue because Nike had lost market share just 20 seconds.

Yeah, absolutely. Look, Nike has lost market share and it is losing market share. But can it win it back is the question. We think yes. On is definitely growing. But if you look at the size of the two companies, you're looking at someone with, you know, more than $40 billion in sales versus someone with less than 10. So there's a big difference. Good point. All right.

Nike shows down 1.7%. Poonam, you rock. Poonam Goyal, Senior Analyst for E-Commerce, Athleisure, Off-Price Retail at Bloomberg Intelligence, joining us from BI headquarters in Princeton. This is the Bloomberg Businessweek Daily Podcast. Available on Apple, Spotify, and anywhere else you get your podcasts.

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