By Jonathan Stempel (Reuters) – Warren Buffett appears to have soured on stocks, letting cash at Berkshire Hathaway (NYSE:) soar to nearly $277 billion and selling about half of its stake in Apple, even as the conglomerate posted a record quarterly operating profit. Berkshire’s results suggest the 93-year-old Buffett, one of the world’s most revered investors, is growing wary about the broader U.S. economy or stock market valuations that have gotten too high. The results were released on Saturday after a stock market selloff that pushed the Nasdaq into correction territory, while a weak jobs report sparked worries about U.S. economic activity and whether the Federal Reserve waited too long to cut interest rates. “If you look at the entire Berkshire picture and the macroeconomic data, a safe conclusion is that Berkshire is getting defensive,” said Cathy Seifert, an analyst at CFRA Research who rates Berkshire a “buy.” The cash stake grew to $276.9 billion as of June 30 from $189 billion three months earlier largely because Berkshire sold a net $75.5 billion of stocks in the quarter. It was the seventh straight quarter Berkshire sold more stocks than it bought. Berkshire sold about 390 million Apple shares (NASDAQ:), on top of 115 million shares sold from January to March, as Apple’s stock price rose 23%. It still owned about 400 million shares worth $84.2 billion as of June 30. Second-quarter profit from Berkshire’s dozens of businesses rose 15% to $11.6 billion, or about $8,073 per Class A share, from $10.04 billion a year earlier. Nearly half of that profit came from Berkshire’s insurance businesses, including a more than tripling of underwriting profit at the Geico car insurer. But revenue rose just 1% to $93.65 billion, and barely changed in major businesses such as the BNSF railroad and Berkshire Hathaway Energy. Net income fell 15% to $30.34 billion from $35.91 billion a year earlier, as rising stock prices in both periods boosted the value of Berkshire’s investment portfolio, including Apple. Buffett has long urged shareholders to ignore Berkshire’s quarterly investment gains and losses, which often lead to outsized net profits or net losses. BUFFETT WANTS TO SPEND, BUT DOESN’T Berkshire pledges to keep a minimum $30 billion of cash, but often lets it build up when it can’t find whole businesses or individual stocks to buy at fair prices. Its returns from short-term Treasuries, however, should decline once rate cuts begin. Berkshire is also using less cash to buy back its own stock, repurchasing just $345 million in the second quarter and none in the first three weeks of July. “We’d love to spend it, but we won’t spend it unless we think we’re doing something that has very little risk and can make us a lot of money,” Buffett said at Berkshire’s May 4 annual meeting, referring to Berkshire’s cash. Berkshire did not immediately respond to a request for comment on Saturday. Buffett remains a big Apple fan, reflecting the iPhone maker’s strong pricing power and committed customer base. He said at the meeting that he expected Apple to remain Berkshire’s largest stock investment, but selling made sense because the 21% federal tax rate on the gains would likely grow. Since mid-July, Berkshire has also sold more than $3.8 billion of shares in Bank of America, its second-largest stock holding. Buffett has led Omaha, Nebraska-based Berkshire since 1965, building it into a conglomerate with dozens of businesses also including many industrial and manufacturing companies, a big real estate brokerage, Dairy Queen and Fruit of the Loom. Vice Chairman Greg Abel, 62, is expected to eventually succeed Buffett as Berkshire’s chief executive. GEICO UNDERWRITING PROFIT TRIPLES Quarterly insurance profit rose 54% to $5.58 billion, benefiting from more investment income and Geico’s ability to charge higher premiums even as drivers submitted fewer claims. Profit at BNSF fell 3% as the railroad set aside more money for lawsuits, offsetting lower operating costs and greater shipping of consumer and agricultural products. Lawsuits also weighed on Berkshire Hathaway Energy, where profit fell 17% because of the PacifiCorp utility unit, which many homeowners and businesses blame for causing Oregon wildfires in 2020. PacifiCorp set aside $2.7 billion for wildfire losses as of June 30, up from $2.4 billion three months earlier, and said losses could grow significantly. Berkshire’s Class A shares closed Friday at $641,435. They are up 18% this year, while the is up 12%. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Berkshire halves Apple stake, boosts cash to $277 billion even as operating profit sets record By Reuters first appeared on Forex Trader Hub.

By Blake Brittain (Reuters) – Country musician Tift Merritt’s most popular song on Spotify (NYSE:), “Traveling Alone,” is a ballad with lyrics evoking solitude and the open road. Prompted by Reuters to make “an Americana song in the style of Tift Merritt,” the artificial intelligence music website Udio instantly generated “Holy Grounds,” a ballad with lyrics about “driving old backroads” while “watching the fields and skies shift and sway.” Merritt, a Grammy-nominated singer and songwriter, told Reuters that the “imitation” Udio created “doesn’t make the cut for any album of mine.” “This is a great demonstration of the extent to which this technology is not transformative at all,” Merritt said. “It’s stealing.” Merritt, who is a longtime artists’ rights advocate, isn’t the only musician sounding alarms. In April, she joined Billie Eilish, Nicki Minaj, Stevie Wonder and dozens of other artists in an open letter warning that AI-generated music trained on their recordings could “sabotage creativity” and sideline human artists. The big record labels are worried too. Sony (NYSE:) Music, Universal Music Group (AS:) and Warner Music sued Udio and another music AI company called Suno in June, marking the music industry’s entrance into high-stakes copyright battles over AI-generated content that are just starting to make their way through the courts. “Ingesting massive amounts of creative labor to imitate it is not creative,” said Merritt, an independent musician whose first record label is now owned by UMG, but who said she is not financially involved with the company. “That’s stealing in order to be competition and replace us.” Suno and Udio pointed to past public statements defending their technology when asked for comment for this story. They filed their initial responses in court on Thursday, denying any copyright violations and arguing that the lawsuits were attempts to stifle smaller competitors. They compared the labels’ protests to past industry concerns about synthesizers, drum machines and other innovations replacing human musicians.UNCHARTED GROUND The companies, which have both attracted venture capital funding, have said they bar users from creating songs explicitly mimicking top artists. But the new lawsuits say Suno and Udio can be prompted to reproduce elements of songs by Mariah Carey, James Brown and others and to mimic voices of artists like ABBA and Bruce Springsteen, showing that they misused the labels’ catalog of copyrighted recordings to train their systems. Mitch Glazier, CEO of the music industry trade group the Recording Industry Association of America (RIAA), said that the lawsuits “document shameless copying of troves of recordings in order to flood the market with cheap imitations and drain away listens and income from real human artists and songwriters.” “AI has great promise – but only if it’s built on a sound, responsible, licensed footing,” Glazier said. Asked for comment on the cases, Warner Music referred Reuters to the RIAA. Sony and UMG did not respond. The labels’ claims echo allegations by novelists, news outlets, music publishers and others in high-profile copyright lawsuits over chatbots like OpenAI’s ChatGPT and Anthropic’s Claude that use generative AI to create text. Those lawsuits are still pending and in their early stages. Both sets of cases pose novel questions for the courts, including whether the law should make exceptions for AI’s use of copyrighted material to create something new. The record labels’ cases, which could take years to play out, also raise questions unique to their subject matter – music. The interplay of melody, harmony, rhythm and other elements can make it harder to determine when parts of a copyrighted song have been infringed compared to works like written text, said Brian McBrearty, a musicologist who specializes in copyright analysis. “Music has more factors than just the stream of words,” McBrearty said. “It has pitch, and it has rhythm, and it has harmonic context. It’s a richer mix of different elements that make it a little bit less straightforward.” Some claims in the AI copyright cases could hinge on comparisons between an AI system’s output and the material allegedly misused to train it, requiring the kind of analysis that has challenged judges and juries in cases about music. In a 2018 decision that a dissenting judge called “a dangerous precedent,” Robin Thicke and Pharrell Williams lost a case brought by Marvin Gaye’s estate over the resemblance of their hit “Blurred Lines” to Gaye’s “Got to Give It Up.” But artists including Katy Perry and Ed Sheeran have since fended off similar complaints over their own songs. Suno and Udio argued in very similar court filings that their outputs do not infringe copyrights and said U.S. copyright law protects sound recordings that “imitate or simulate” other recorded music.”Music copyright has always been a messy universe,” said Julie Albert, an intellectual property partner at law firm Baker Botts in New York who is tracking the new cases. And even without that complication, Albert said fast-evolving AI technology is creating new uncertainty at every level of copyright law. WHOSE FAIR USE? The intricacies of music may matter less in the end if, as many expect, the AI cases boil down to a “fair use” defense against infringement claims – another area of U.S. copyright law filled with open questions. Fair use promotes freedom of expression by allowing the unauthorized use of copyright-protected works under certain circumstances, with courts often focusing on whether the new use transforms the original works. Defendants in AI copyright cases have argued that their products make fair use of human creations, and that any court ruling to the contrary would be disastrous for the potentially multi-trillion-dollar AI industry. Suno and Udio said in their answers to the labels’ lawsuits on Thursday that their use of existing recordings to help people create new songs “is a quintessential ‘fair use.'”Fair use could make or break the cases, legal experts said, but no court has yet ruled on the issue in the AI context. Albert said that music-generating AI companies could have a harder time proving fair use compared to chatbot makers, which can summarize and synthesize text in ways that courts may be more likely to consider transformative. Imagine a student using AI to generate a report about the U.S. Civil War that incorporates text from a novel on the subject, she said, compared to someone asking AI to create new music based on existing music. The student example “certainly feels like a different purpose than logging onto a music-generating tool and saying ‘hey, I’d like to make a song that sounds like a top 10 artist,'” Albert said. “The purpose is pretty similar to what the artist would have had in the first place.” A Supreme Court ruling on fair use last year could have an outsized impact on music cases because it focused largely on whether a new use has the same commercial purpose as the original work. This argument is a key part of the Suno and Udio complaints, which said that the companies use the labels’ music “for the ultimate purpose of poaching the listeners, fans, and potential licensees of the sound recordings [they] copied.” Merritt said she worries technology companies could try to use AI to replace artists like her. If musicians’ songs can be extracted for free and used to imitate them, she said, the economics are straightforward. “Robots and AI do not get royalties,” she said. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Music labels’ AI lawsuits create new copyright puzzle for US courts By Reuters first appeared on Forex Trader Hub.

In the ongoing trade dispute between China and the European Union (EU), analysts at Citi said in a note this week that China is strategically preparing for potential retaliation while maintaining a restrained stance. Following the EU’s imposition of provisional tariffs on Chinese electric vehicles (EVs) on July 4, 2024, China has responded cautiously, focusing on negotiation but also signaling readiness to retaliate if necessary, according to a recent Citi note. The bank explained that China’s initial retaliatory measures include targeted investigations into brandy and pork imports from the EU. The Ministry of Commerce (MofCom) announced an anti-dumping investigation into brandy imports from the EU, with a particular focus on France, which accounts for 99.3% of China’s brandy imports. Despite this, Citi says any potential tariffs on brandy are expected to have limited impact on China’s alcohol market, which recently resumed imports from Australia after lifting tariffs imposed in 2021. Similarly, they explain that an anti-dumping investigation into EU pork imports is underway. China, the world’s largest pork consumer, imported $6.9 billion worth of pork in 2023, with 47.9% coming from the EU. The investigation is said to target major suppliers such as Spain, the Netherlands, Denmark, and France. Despite ample domestic supply and a deflationary consumer price index, any tariffs on pork could leverage China’s position in negotiations, says Citi. Additionally, the bank says China has initiated a broad investigation into EU trade practices and barriers, affecting products like railway locomotives, photovoltaics, wind power, and security equipment. This probe, which could last until mid-April 2025, reflects China’s response to earlier EU investigations into Chinese subsidies and market access. Furthermore, the bank believes China’s strategic patience indicates that it prefers negotiation to escalation. As a significant surplus economy, China aims to avoid decoupling from global markets and supply chains. According to Citi, Beijing is likely to offer reasonable concessions in trade talks with the EU while remaining calibrated in its responses until the disputes potentially escalate. In conclusion, Citi believes China holds significant retaliatory options in the trade dispute with the EU, from targeted investigations to broader trade barrier probes. However, they feel its primary focus remains on negotiation, seeking to resolve disputes amicably while preparing for all eventualities. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post What cards does China hold in trade dispute with EU? By Investing.com first appeared on Forex Trader Hub.

(Reuters) – Hawaiian Electric Industries (NYSE:) is among the defendants who have agreed to pay $4 billion to settle lawsuits over the deadly Maui wildfires, the company said on Friday. The utility operating on the island and its parent, Hawaiian Electric, are liable for $1.99 billion of the amount before tax, which includes $75 million previously contributed to the One Ohana Initiative. Settlement payments will begin after judicial approval and are expected to be made from mid-2025, Hawaiian Electric said in a statement. Hawaiian Electric and defendants including county officials faced lawsuits over the blazes that tore through Maui last year, killing at least 100 people, destroying thousands of properties and causing damage estimated at $5 billion. The lawsuits claimed the utility failed to shut off power lines despite warnings that high winds might blow them down and spark wildfires. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Hawaiian Electric, others agree to $4 billion Maui wildfire settlement By Reuters first appeared on Forex Trader Hub.

GBP/USD rallies from daily low of 1.2707 to trade above the 1.2800 mark. Key resistance levels reclaimed: 50-DMA at 1.2787 and 1.2800 mark; next targets are 1.2860, 1.2900, and 1.2950. If GBP/USD falls below 1.2800, it may range between 1.2800 and 1.2700, with further support at 100-DMA (1.2683). The Pound Sterling rallied sharply against the US Dollar after recent economic data from the United States (US) sparked speculation that the US Federal Reserve might cut interest rates faster than expected. The GBP/USD trades at 1.2833 after hitting a daily low of 1.2707. The Greenback is being battered, given the backdrop of the July ISM Manufacturing PMI plunging to its lowest level since December 2023 and Nonfarm Payrolls missing the mark. Market participants had begun to price in a larger rate cut at the upcoming September meeting. GBP/USD Price Analysis: Technical outlook After diving throughout the week, the GBP/USD reclaimed key resistance levels like the 50-day moving average (DMA) at 1.2787 and the 1.2800 mark. Momentum shifted in buyers’ favor as the Relative Strength Index (RSI) turned bullish If GBP/USD closes above 1.2800, that can pave the way for testing the June 12 high at 1.2860 and expose the 1.2900 psychological figure. Once surpassed, further upside is seen, with the next stop being 1.2950, which capped price action for four consecutive days before buyers could challenge 1.3000. Conversely, if sellers drag the GBP/USD pair below 1.2800, then the pair could stay range-bound within the 1.2800-1.2700 mark, which, if broken, will expose the 100-DMA at 1.2683. GBP/USD Price Action – Daily Chart Pound Sterling FAQs The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, aka ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.   Source link The post Rises above 1.2800 amid weak US data fueling rate cut hopes first appeared on Forex Trader Hub.

Bitcoin (BTC) whales, or addresses with over 1,000 BTC, or at least $64 million, have added 84,000 BTC in July despite the cryptocurrency market’s recent crab walk. What’s more, whales have been moving BTC from exchanges at the fastest pace since 2015.  Bitcoin: Whale volume from exchanges spikes Bitcoin whales continue accumulating and taking the coins off exchanges, despite the recent sluggish momentum in the BTC/USD pair. Notably, Bitcoin whales with at least 1,000 BTC have moved the most Bitcoin out of exchanges since 2015, marking the biggest spike in nine years, according to the whale net position change metric by Glassnode. Around 64,000 BTC has left whale exchange balances in the past 30 days. Bitcoin whale volume to/from exchanges, net position change. Source: Glassnode This is the biggest negative net position change for exchange whales since September 2015, when BTC price was bottoming around $220. Moreover, Bitcoin addresses with at least 1,000 BTC have added an average of over 100,000 BTC per week, according to CryptoQuant CEO Ki Young Ju, who noted last month: “Whale wallets (>1K BTC), including spot ETFs and custodial wallets, added 1.45M BTC this year, totaling 1.8M BTC. In 2021, about 70K BTC flowed in over the year; now, it’s 100K BTC ‘weekly.’ I repeat. 100K BTC weekly.” BTC balance: new wallets over 1,000 BTC. Source: Ki Young Ju According to Glassnode data, as of Aug. 1, 1,651 whale addresses held at least 1,000 BTC, up from 1,498 at the start of the year. Related: $35T US national debt could bolster Bitcoin’s adoption as ‘hard money’ Is the Bitcoin bottom in? Bitcoin price may have formed a new local bottom above the $63,000 mark, which previously acted as a strong support for BTC on the four-hour chart, according to crypto analyst Elja, who wrote in an Aug. 1 X post: “BTC has bottomed. It’s time for some big green candles.” BTC/USDT, 4-hour chart, bottom formation. Source: Elja Adding to the positive outlook, Bitcoin completed a monthly bullish close above a “key macro level” of $61,600, according to popular trader Titan of Crypto. He wrote in an Aug. 1 X post: “Despite the turbulence, BTC managed to remain above a key macro level. This is very encouraging. Summer may bring a boring market, but the upcoming months are going to be very interesting.” BTC Ichimoku Analysis. Source: Titan of Crypto However, Bitcoin was rejected from the $70,000 psychological resistance, meaning that, according to popular analyst Rekt Capital, it could remain rangebound until September. The analyst wrote in a July 30 X post: “Bitcoin is still on track for a September breakout. History suggests that a breakout from the ReAccumulation Range mere ~100 days after the Halving was always going to be unlikely” BTC/USD, 1-week chart. Source: Rekt Capital As Cointelegraph reported, support at $63,000 and around $57,000 remain the key levels to watch for a rebound.  This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. Source link The post Bitcoin whale volume from exchanges hits 9-year high as analysts call BTC price bottom first appeared on Forex Trader Hub.

By David Shepardson WASHINGTON (Reuters) – A group of 21 states and more than 50 U.S. lawmakers on Friday backed the Justice Department in its defense of a law that requires China-based ByteDance to sell TikTok’s U.S. assets by Jan. 19 or face a ban. “TikTok is a threat to national security and consumer privacy,” said a court filing led by the state attorneys general of Montana and Virginia. “Allowing TikTok to operate in the United States without severing its ties to the Chinese Communist Party exposes Americans to the risk of the Chinese Communist Party accessing and exploiting their data.” A group of more than 50 lawmakers led by U.S. Representative John Moolenaar, a Michigan Republican and chair of the House select China committee and the panel’s top Democrat Representative Raja Krishnamoorthi, said in a separate filing the law “provides a clear, achievable path for affected companies to resolve the pressing and non-hypothetical national security threats posed by their current ownership structures.” TikTok and parent company ByteDance and a group of TikTok creators have filed suits to block the law that could ban the app used by 170 million Americans. The U.S. Court of Appeals for the District of Columbia will hold oral arguments on the legal challenge on Sept. 16, putting the fate of TikTok in the middle of the final weeks of the 2024 presidential election. The congressional filing was signed by House Majority Leader Steve Scalise, a Republican, former House Speaker Nancy Pelosi, and Republican Senator Marco Rubio and Frank Pallone, top Democrat on the Energy and Commerce Committee. “Congress acted not to punish ByteDance, but to protect national security,” the lawmakers wrote. TikTok said “these filings ignore the fact that Congress passed the TikTok ban with no record supporting the government’s claims. Moreover, these filings do nothing to change the fact that the Constitution is on our side as the TikTok ban would violate the First Amendment rights of 170 million Americans who use TikTok.” Driven by worries among U.S. lawmakers that China could access data on Americans or spy on them with the app, the measure was passed overwhelmingly in the U.S. Congress in April just weeks after being introduced. The Justice Department last week asked a U.S. appeals court to reject legal challenges to the law saying “the serious national-security threat posed by TikTok is real.” !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post More than 50 US lawmakers, 21 states back DOJ in TikTok lawsuit By Reuters first appeared on Forex Trader Hub.

DoorDash (NASDAQ:), the technology company connecting people with the best of their neighborhoods, reported its Q2 2024 earnings, highlighting strong consumer demand and an ongoing digital shift in the restaurant and retail industries. CEO Tony Xu and CFO Ravi Inukonda outlined the company’s growth in new customer acquisitions, expansion into non-restaurant use cases, and a significant interest from top consumer packaged goods (CPG) advertisers in their advertising business. The company’s international portfolio is gross profit positive, with the retention and frequency levels in international markets surpassing those in the US. DoorDash remains focused on creating the best service for customers, couriers, and merchants, and sees a substantial opportunity to become the largest local commerce platform globally. Key Takeaways DoorDash is experiencing strong consumer demand and is still in the early stages of the digital shift. New customer acquisitions and expansion into non-restaurant use cases are driving growth. DashPass subscribers and order frequency have reached all-time highs. The company’s international markets are performing well with better retention and frequency levels compared to the US. DoorDash’s advertising business is attracting significant interest from top CPG advertisers while maintaining a healthy marketplace. Regulatory issues such as Prop 22 in California have been upheld, with the company monitoring changes in other markets like New York City and Seattle. The company aims to grow rapidly while remaining disciplined in investments and improving efficiency. Company Outlook DoorDash plans to continue growing its ad and platform businesses. The focus on product innovation is aimed at improving retention and order frequency. The company is investing in engineering and product areas to drive growth and efficiency. Bearish Highlights Regulatory costs in New York and Seattle have introduced some elasticity, but the overall growth rate remains unaffected. The company acknowledges the complexity of achieving price parity and is working to align its business model accordingly. Bullish Highlights The international portfolio is gross profit positive and improving. DoorDash has a strong foundation in all markets, with room for growth in restaurant selection and retail. The ad business is growing fast, with an evolving ad tech stack that has room for further growth. Misses There is no mention of significant misses in the provided earnings call summary. Q&A Highlights The company is focused on affordability and has not seen a significant impact from inflation on their business. DoorDash is balancing ad load to maintain a positive user experience while growing its ad business. Executives expect the EBITDA impact from regulatory costs to decrease throughout the year. DoorDash’s Q2 2024 earnings call showcased a company in a strong position to capitalize on the digital shift in consumer behavior. With a robust international presence, a growing subscriber base for DashPass, and a burgeoning advertising business, DoorDash is making strides toward becoming a dominant player in the local commerce platform space. The company’s leadership is committed to maintaining a balance between growth and efficiency, ensuring affordability, and providing a positive consumer experience while navigating regulatory landscapes across various markets. InvestingPro Insights DoorDash’s recent Q2 2024 earnings call underlined the company’s promising growth trajectory and strategic initiatives in expanding its market reach. To provide further context to DoorDash’s financial health and market performance, here are some key insights based on real-time data from InvestingPro, along with valuable InvestingPro Tips: InvestingPro Data: Market Cap (Adjusted): 47.69B USD Revenue Growth (Last twelve months as of Q1 2024): 27.24% Price, Previous Close: 108.2 USD InvestingPro Tips: 1. DoorDash holds more cash than debt on its balance sheet, which is a positive sign of its financial stability and capacity to fund future growth without over-reliance on external financing. 2. Analysts predict the company will be profitable this year, reflecting an optimistic outlook on DoorDash’s ability to translate its growth into bottom-line results. These insights are particularly relevant as they highlight DoorDash’s robust market valuation, its impressive revenue growth rate, and the positive sentiment from analysts regarding its profitability potential. Investors and stakeholders can explore further insights and tips, including 7 additional InvestingPro Tips for DoorDash, by visiting https://www.investing.com/pro/DASH. These additional tips can provide a deeper understanding of the company’s financials, valuation metrics, and market performance, enabling a more informed investment decision. Full transcript – Doordash Inc (DASH) Q2 2024: Operator: Thank you for standing by. My name is John, and I’ll be your conference operator for today. At this time, I would like to welcome everyone to the DoorDash Second Quarter 2024 Earnings Call. I would now like to introduce and welcome Mr. Andy Hargreaves, VP of Investor Relations to begin the call. Andy, the floor is yours. Andy Hargreaves: Thanks, John. Good afternoon, everyone. And thanks for joining us for our Q2 2024 earnings call. Very pleased to be joined today by Co-Founder, Chair and CEO, Tony Xu; and CFO, Ravi Inukonda. We’ll be making forward-looking statements during today’s call, including our expectations for our business, financial position, operating performance, our guidance strategies, capital allocation approach and the broader economic environment. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those described. Many of these uncertainties are described in our SEC filings, including our Form 10-Ks and 10-Qs. We should not rely on our forward-looking statements as predictions of future events. We disclaim any obligation to update any forward-looking statements except as required by law. During this call, we will also discuss certain non-GAAP financial measures. Information regarding our non-GAAP financial measures, including a reconciliation of the non-GAAP measures to the most directly comparable GAAP measures, may be found in our earnings release, which is available on our Investor Relations website. These non-GAAP measures should be considered in addition to our GAAP results and are not intended to be a substitute for our GAAP results. Finally, this call is being audio webcasted on our Investor Relations website, and an audio replay of the call will be available on the same website shortly after the call ends. John, I’ll pass it back to you and we can take the first question. Operator: Thank you. [Operator Instructions] Thank you. The first question comes from the line of Nikhil Devnani from Bernstein. Please go ahead. Nikhil Devnani: Hi. Thanks for taking the question. I wanted to ask about what you’re seeing from an overall demand perspective. There’s a lot of talk right now about softening restaurant demand. Your outlook points to some deceleration, but still looks very healthy. So, I guess, to what degree are you seeing changes in behavior or softening on that front? And my follow-on to that is a bit more of the secular story here. So, I mean, how would you characterize the new customer funnel for the U.S. restaurant marketplace? I think there’s a common perception that all customers should have been acquired during the pandemic, but what do you see on that front in terms of how new customers are still adopting this service today and how does that make you — how do you think about where we are on kind of the growth curve there? Thank you. Tony Xu: Hey, Nikhil. It’s Tony. I’ll take both of those and feel free to chime in, Ravi. We’re seeing really strong demand on the consumer side. So, we’re not actually seeing some of the challenges that you may be hearing about or reading about in other headlines. I think there are a few reasons for this. I think, first, we’re still in the early innings of the move towards digital and the overall omnichannel experiences that every restaurant and retailer is participating in and we’re lucky to play in the part that is growing. I mean, if you look at digital only, that’s growing not just for us at DoorDash on our marketplace, it’s also growing for us in our first-party platform as we power a lot of these restaurant and retailer websites for ordering, as well as their delivery channels. And they see that too, by the way. While some restaurants, to your point, may be seeing some headwinds in traffic, I mean, their digital channels are growing very robustly, many multiples of, I think, their overall growth and we see that similarly. But at the same time, we’re still just single-digit penetration in restaurants and outside of restaurants. We’re even lower than that. So, we see a long runway for growth there. The second point I make is that our product continues to get better. I mean, if you looked at our cohort behavior, whether it’s retention or order frequency, I mean, all of these things are as good or better than even our pandemic cohorts for every cohort since the pandemic. And so, I think that’s a reflection and testament to the work that the team is doing. We already have category-leading selection, but we’re continuing to extend that lead. We have the best quality as well as lowest cost logistics network in the most places in the U.S., not just for restaurants, but also for retail. That continues to get more accurate and faster. We continue to work on our affordability programs. I mean, DashPass had an all-time high in terms of its subscriber base. So, I think a lot of people are resonating across all of the dimensions in which we are judged from the consumer’s view. The final point I make is that, we are increasing the number of use cases on DoorDash. We continue to see just tremendous growth, much faster than the industry, I mean, many, many, many fold faster than anyone else, both in the U.S. as well as globally in restaurants, but also outside of restaurants. And increasingly, we’re seeing customers come to us for the first time actually for non-restaurant use cases. And so, in terms of your question on new customers, I mean, we actually see a couple of things. One, we still acquire more than anyone else. I mean, more than — in restaurants, more than one out of every two new customers that come into the industry. Outside of restaurants, we’re about one in every two. So, in any category of local commerce, we acquire more new customers than anyone else. And I think what you see about the point about like, “Hey, look, is the new customer point saturating?” The way I think about this is for us at DoorDash, yes, we have tens of millions of customers every single month, but we have many multiples of that ordering with us every single year. So, within even our own ecosystem, whether they’re a new customer or a customer that’s an occasional customer that’s coming back now to the platform, within our own ecosystem, we have a long runway for growth. And so, yes, we’re getting new customers, especially in restaurants and new categories. I mean, I mentioned some of those stats, but we’re also getting customers who are in our ecosystem. They don’t participate yet with us every single month or every single day, but increasingly, they’re getting this. Ravi Inukonda: So, Nikhil, just to add a couple of points to what Tony talked about, right? The demand on the platform continues to be very strong. When we look at the underlying cohorts, they’re very strong. The recent cohorts are actually as strong as any of the older cohorts that we’ve seen. Even for the core restaurant business, when I look at the growth rate in GOV on a year-over-year basis, the growth in Q2 is very consistent with what we saw in Q1. Even from a linearity perspective, the business actually grew faster in June compared to April. Tony talked about some of this, but DashPass had a really strong quarter, all-time high in terms of subscribers, order frequency continues to be at an all-time high. So, the underlying cohort strength is actually very strong and the demand continues to be very strong across the Board for us. Nikhil Devnani: Thank you, both. Operator: The next question comes from the line of Ross Sandler from Barclays. Please go ahead. Ross Sandler: Hey, guys. First one on the take rate, it’s up quarter-on-quarter, year-on-year, the revenue take rate. And in the letter, you talked about reducing consumer feed and you just mentioned DashPass growing a lot faster than overall. So, could you talk about, like, what’s driving that? Are you seeing efficiencies on Dasher cost or something else like drive causing that take rate to go up as much as it is? And then the second one is, you also mentioned that the majority of your largest international markets have better retention than U.S. Could you just give us a little bit more color on what’s driving that? Is that kind of the breadth of offering or levels of competition or something else? That’s all. Thanks a lot. Ravi Inukonda: Hey, Ross. I’ll take the first one. Tony, feel free to jump in on the second one. But in take rate perspective, Ross, let me break out what’s going on with revenue. If you think about revenue, there’s a few different components. You have the ad business, which is growing really fast. You have a platform business, which is also growing really fast. Both of those are driving the improvement you’re seeing in both revenue growth as well as take rate. At the same time, you also have cost lines, whether it’s Dasher or quality. The team has done a great job of improving that compared to last year, boosting improvements in efficiency. For us, the goal has always been to continue to drive improvements from an efficiency perspective. But at the same time, we’re also going to continue to find opportunities to reinvest that back in growth. As I look ahead from a take rate perspective, I do expect us to improve and grow our ad business, as well as our platform business. Even on the cost line, there’s still lot of opportunity for us to continue to drive improvements in efficiency. At the same time, we’re going to try to find good opportunities where we can drive investments in retention or the frequency while continuing to improve the overall take rate in the business. Tony Xu: And Ross, on the second question about international markets and just the retention and frequency levels there. I mean, it’s really a story of two things. One is, well, we started with a very robust set of fundamentals and foundation, right? I mean, this really was the key investment thesis behind teaming up with Wolt. I mean, when we were looking internationally in terms of expansion opportunities, one of the things, perhaps, the top thing that got us most excited about teaming up with Wolt was the fact that they had leading retention and frequency in every market that they competed in. And that’s a combination of a few things. But at the end of the day, it comes down to offering the best combination of inputs for customers, the best selection, the best quality of service in terms of delivery quality, the best affordability, and the best support. The second thing I would say is that, since teaming up with Wolt, which closed in 2021, it’s been a couple of years now. We’ve added some of the lessons that we’ve learned at DoorDash, lessons in making improvements to each one of these inputs. And that combination, I think, is what you see that’s driving the growth and virtually taking share gains in every market that we play in. Operator: The next question comes from the line of Michael Morton from MoffettNathanson. Please go ahead. Michael Morton: Hi, guys. Thanks for the question. If we could maybe do two, one on international, following up on some of the comments Tony just made and then maybe a quick one on groceries. Tony, I love hearing more about the retention aspects for international, but like you talked about in the press release today, two full years with Wolt. Love to learn some more just beyond the retention aspects. Some key takeaways after running this business for two full years on what it takes for the best performance in these international markets. Is it market structure, market share, consumer spending capabilities? And then how that might dictate your plans to grow in new countries and/or maybe exit certain markets where you don’t like the industry structure? And then just a quick one on CPG advertising, some learnings and differences you’ve picked up compared to your restaurant advertising business would be great? Thank you. Tony Xu: Sure. Yeah. I mean, on the first question regarding international and just lessons learned. I mean, the first thing I would say that — is that, there’s no silver bullet in operating these kinds of businesses, but the story is really the same in virtually every market. Sure, every market, to your point, has different challenges and different dynamics in the market, but at the end of the day, it comes down to who can create the best service for customers, couriers and merchants. And I think remembering that as simple as it sounds is actually quite important, because I think there’s always a lot of competitive activities in our space, but I think that making sure that you can win on building the best product as measured by the highest retention and frequency levels. I mean, that’s kind of what we’ve always held ourselves to. That’s what the customer holds us to. And I think that we’ve been lucky in that we’ve been able to achieve that bar at least better than anyone else in all the markets that we plan. But at the same time, it’s also not good enough, if you look at just how underpenetrated so many of these markets are, especially outside of the United States. And that’s true in the restaurants category, but that’s true virtually in every category, which just means that we’ve got a long ways to go before we’re satisfied with what we’ve done for our customers in solving the local commerce opportunity. With respect to CPG, I think, it’s been just a really fast learning curve for us. I think we had a lot of attention and excitement from virtually every top CPG advertiser, because they saw the largest local commerce platform offering ads for the first time three years ago that had the highest frequency, the highest membership base for local commerce and the highest cross-sell between categories. And so, obviously, their question is like, “Hey, what are you waiting for? When are you guys going to actually open up the platform, so that we can meet new customers?” At the same time, we also have to balance the other side, which is an advertising business can only be built off the back of a healthy and robust marketplace business, and it doesn’t really go the other way around. You need the marketplace business to grow in order for your advertising business to have a long runway for healthy growth. And so that’s kind of what we’ve always looked for, but it’s always two guiding principles. How do we offer the best-in-class consumer experience with no degradation in experience, and how do we offer the best return for advertisers? And that’s true for small restaurants, that’s true for big restaurants, that’s true for big CPGs, that’s true for small mid-market CPGs. I think that, one thing that you see now that we’re in the third year of doing this is we’re starting to finally make great progress in just offering a very balanced portfolio. I think we started by offering and introducing ads to restaurants where I think that was, something that was very natural to some of the activities that we had done before then. But now that’s pretty much fully built out for CPGs and I think now it’s making sure that we grow that in a responsible way, achieving, again, the balance between consumer happiness and advertiser returns. Ravi Inukonda: Hey, Mike. It’s Ravi. Just to add a couple of points that Tony talked about on the international side. Again, the formula for us, like Tony mentioned, is largely similar. We’re seeing strength in retention. We’re seeing strength in order frequency, as well as gross profit. Last call, I talked about the fact that the entire international portfolio is gross profit positive and it has continued to improve. For us, what’s important is we want to drive scale. Scale drives efficiency in the business. We’ve done that in the U.S. and it’s the same formula we’re using in the international market as well. Michael Morton: Thank you. Operator: The next question comes from the line of Andrew Boone from JMP Securities. Please go ahead. Andrew Boone: Great. Thanks so much for taking my questions. You mentioned in the press release better frequency for new verticals. Can you help us better understand that for drivers and then where are you seeing better frequency? And then a question really on ramping new merchants. We’ve noticed that incentives are larger. As we think about you guys normalizing on selection, can you just help us understand the size of the investment it takes to bring new merchants onto the platform? Thanks so much. Tony Xu: I can take the first part of the question. I mean – Andrew, I guess, in general, I mean, we see order frequency increases both within restaurants and incrementally on top of that from new verticals. It depends a lot on the geography and which new selection that has been onboarded or so how strong the selection density is within a market. For example, obviously, we’ve been very strong in grocery and in convenience. That’s been a big focus for us for years. And we’re excited, actually, just this morning, we announced an update to our partnership with Chase, which now makes us Chase’s exclusive partner in both restaurant delivery and grocery delivery for all of their cardholders. And so, I think you’re seeing the appreciation of our performance, not just by consumers, but also by other large companies out there that are trying to tap into a very valuable base of customers, a lot of whom are coming to us for grocery and for these new verticals. But there are examples where we just launched recently, for example, with Ulta Beauty (NASDAQ:). So as we’ve launched health and beauty, some customers come to us for the first time, whether it’s to Ulta, to Sephora, to other health and beauty merchants for the first time, or Lowe’s in the home improvement category. So, it’s not coming from one area. As we add more categories, we see more order frequency growth. Ravi Inukonda: Yeah. Andrew, I’ll take the second one. Maybe just a couple of points on the first one that Tony mentioned. Our goal is to drive overall order frequency up. We’re not trying to drive just the restaurant order frequency up or the new verticals order frequency up. In fact, looking at the order frequency in a blended basis is not how we think about the business. It’s truly a cohorted business. When I look at the cohorts, even the age cohorts, they’re engaging better with us. Their order frequency is going up, partly because the product has gotten better. You have more categories. Delivery times have gotten better. The entire order frequency continues to go up. The newer cohorts are actually joining at better order frequency than many of the older cohorts. Andrew, second point on selection investment. I mean, look, I mean, our goal is to continue to drive selection higher. It’s a core part of our strategy. We are adding selection in restaurants. We are definitely adding more selection on the grocery side, as well as international. The way we think about it is, as long as we are driving incremental GOV, as long as the conversion is continuing to increase, we’re going to continue to drive selection higher. And you’re seeing that strength being reflected in not just the demand, but the underlying cohorts of the business as well. Andrew Boone: Thank you. Operator: The next question comes from the line of Brad Erickson from RBC Capital Markets. Please go ahead. Brad Erickson: Thanks. I just have two here. One, on the incremental flow through of EBITDA, so relative to GOV, it looks like it picked up a quarter-over-quarter maybe a couple 100 basis points. Can you call out any drivers of the difference there, if you can? And then second, in a bigger picture, Ravi just talked about the improving unit economics on the gross margin side across all parts of the business. So, it kind of seems like that should roughly rhyme with EBITDA expansion over time. What are any other considerations as to why that would not be the case, if you could? Thank you. Ravi Inukonda: Yeah. Let me take the first one and I’ll get into the second one. On the EBITDA upside that we saw in Q2, there’s two factors, right? One, you saw us continue to drive higher growth. GOV came in better than expectations. The overall business is gross profit positive, so you’re seeing that flow through to the bottomline. Two, you also have improvements in unit economics, gross profit across most major lines of business. You’re seeing that impact the overall business as well. From a philosophy perspective, Brad, I mean, I think, I want to be clear. Our goal is to grow as fast as we can by being inside of the range from an EBITDA perspective. I would expect that to be the case going forward in Q3 as well. But longer term, let me break the business apart, right? On the restaurant side, we’ve done a great job of improving the contribution margin in H1 despite absorbing some of the regulatory costs. There’s still a lot of opportunity for us to continue to drive margin higher there. It’s not going to be at the same clip as we’ve done over the last couple of years. New verticals, as well as international are still early. We’re seeing good growth. We’re seeing good opportunities to continue to invest there. But these businesses are not truly optimized for efficiency. As we continue to drive efficiency higher across the P&L, I would expect margins to continue to improve. More importantly for us, the formula has always been invest behind retention, order frequency, as well as continued improvement in gross profit. We have seen that in the business. If we find good areas to continue to drive investment, we’re going to do that. Our goal is to drive GOV growth while being disciplined from an overall investment perspective. Brad Erickson: Got it. That’s great. Thank you. Operator: The next question comes from the line of Bernie McTernan from Needham. Please go ahead. Bernie McTernan: Great. Thank you. Just wanted to stick on international. Tony, you mentioned the shareholder ladder, how international ambitions remain well above what you’ve been able to achieve so far. So, just want to see — does that mean more countries, different categories or different products coming to your current? And basically, do you have the right asset mix currently to achieve those ambitions? Tony Xu: Yeah. Hey, Bernie. I mean, I guess, to add to some of the comments I made previously, we have a good foundation to build from in all of our markets. That’s how we start. And if you don’t have that, it’s difficult to solve every local commerce problem. For us, that obviously starts with the restaurant business, which, whether it’s internationally or here in the U.S., we have leading retention and frequency, which is a great place to build upon. And we’ve added quite a lot of categories into all of our markets actually and those are growing really, really nicely. But when I look outside of the U.S., I would say that, the vast majority, virtually every country outside the U.S. for us, is still behind what we think the penetration levels ought to be if we actually brought all of the products that we have in market here in the U.S. overseas. We’re not there yet, right? We have a great house in which the structure is very, very good. We’re growing many folds faster than our peers. We’re doing a nice job of launching new products that we’ve built from the DoorDash side to all of our markets. But on the flip side, I would say that, the levels there are still not where they ought to be. We’ve got a long ways to go on getting restaurant selection where it needs to be. We’re off to a fantastic start outside of restaurants, especially given that retail, I would say, is a little less developed on a comparative basis when you look outside of the U.S. versus, say, the retail industry within the U.S. And then when I look at the five businesses that we have, as well as other businesses that we’re incubating, I think, the potential to bring this globally to be the largest local commerce platform in any country, I think, that remains just a very, very large opportunity for many years of growth. Bernie McTernan: Makes sense. Thanks, Tony. Operator: The next question comes from the line of Michael McGovern from Bank of America. Please go ahead. Michael McGovern: Hey, guys. Thanks for taking my question. I wanted to ask, again, a little bit about the restaurant menu inflation. Is there any dynamic underlying the AOV number that is basically suggesting that there is some level of food inflation and maybe have some offsetting, things like drive that are making AOV not increase? And then also just quickly, I want to see if you comment on regulatory with Prop 22 being upheld in California and are you still seeing any impact in New York City and Seattle from regulatory changes there? Thank you. Ravi Inukonda: Hey, Mike. I’ll take the first one. Tony will take the second one on regulatory. On the first one, I mean, look, I mean, inflation has not had a big impact on our business. If you think about it, like when inflation first peaked about a year ago, we saw fewer items per order. But overall, we’ve also driven consumer fees down. So I look at overall, even the restaurant business from an AOV perspective, it’s relatively flat year on year. So we’re not seeing any impact on that. And pretty pleased with the progress we’ve made on overall affordability, which is continuing to drive the growth that you’re seeing in the business. Tony Xu: Yeah. The second question with respect to regulatory, it’s actually pretty much the same story that I think we’ve communicated ever since doing the first earnings call. And really, it reflects even what we thought 10 years ago when we started forecasting what might be true in regulatory, in particular on the labor piece across the world, which is I think in the majority of the world, the overwhelming majority, most jurisdictions want to actually support us in giving Dashers what they want, which is the flexibility of a work opportunity that’s never existed before and also protections that we believe they deserve. I mean, to your point or the premise of the question, you’re right. I mean, it’s good to see that lawmakers most recently upheld Prop 22 here in California. We expect that. We expected that not just because we’re right on the wall, but because we think it’s the right thing to do. It’s actually giving users in this case, the Dasher, the driver, exactly what they’re looking for. I always have to remind people that over 90% of Dashers do fewer than 10 hours a week on the platform. The average Dasher does 3 hours a week to 4 hours a week. The overwhelming majority, over 80%, 85% of Dashers actually have full-time jobs. So they’re specifically telling us, we do not want to be told what hours to work or where to work them. And so we see that most governments, lawmakers around the world, certainly here in the U.S. as well, actually want to do right by the Dasher and actually support us in what we want to do for workers. I also hope whether it’s this election cycle or future election cycles, whether it’s here in the U.S. or around the world, that things will moderate a bit in terms of temperature and that this can be something that we as a company, as well as other companies in the space can work productively with any government to actually achieve what Dashers want. And I don’t know, Ravi, did you want to comment on New York or Seattle or any… Ravi Inukonda: Yeah. Tony Xu: … of these economic activities? Ravi Inukonda: Yeah. Maybe on New York and Seattle. I talked about the fact in the last call that we did take a meaningful amount of impact on EBITDA from the regulatory cost in Q1. That did come down in Q2, just like I said it would. A lot of that is being driven by the underlying improvements we’ve made in product to drive efficiency higher. I do expect those costs to continue to reduce as we go through the rest of the year. Look, I mean, our goal in philosophy has always been any market that we operate in, want to run with sustainable unit economics, and that’s going to be true for these markets as well. It’s not going to be a step function change. It’s going to be a gradual change. We really like what we’re seeing in the business from an overall efficiency improvement perspective for those markets. Michael McGovern: Got it. Thank you. Operator: The next question comes from the line of Ron Josey from Citi. Please go ahead. Ron Josey: Great. Thank you for taking the question. Can you hear me okay? Tony Xu: Yeah. Go ahead, Ron. Ron Josey: Oh! Great. Perfect. So maybe a follow-up on what we were talking about earlier and all the improvements on efficiencies. The letter — the press release talked about reducing order defect rates and merchant churn while also lowering fees. And I’m just wondering, this lowering fees, is this passing along the savings and you’re sort of seeing the benefits of, call it, lowering fees, more efficiency, lower fees, higher order rates. It’s all coming together. I wanted to get your thoughts on just, are you passing along these savings to consumers and then therefore seeing improving top line growth? I’m curious on that dynamic. Thank you. Tony Xu: Yeah. Hey, Ron. It’s Tony. I mean, look, we’re always trying to do one thing, right? Which is to move fees in one direction. I don’t think I’ve ever spoken to a consumer who’s asked us to raise prices. And so we are always trying to lower the fees and pass them on. And there’s various ways in which you can do this. We’re obviously trying to be more affordable. We’re trying to increase and widen the selection lead that we have. We are trying to improve the quality of our logistics system. We believe we have the best one, but it doesn’t mean that it’s perfect. And so we have to get more accurate. We have to get faster. We have to be better about finding every product in the physical world, especially now that a lot of what we do is outside of restaurants and inventory remains a challenge for every physical retailer. And so there’s a lot of work to do. We’re not yet satisfied with where we are on all of the dimensions. We appreciate and tremendously respect all of the efforts that our teams have done in terms of building the best product, in terms of having category leading retention and frequency. We’re not there yet. In the eyes of the consumer, we can still be more affordable. We can still have better selection. We can still have better quality and better support. So we’re working on all of those things. Ravi Inukonda: And Ron, just to add to that, the way we think about investing is, our goal is to grow as fast as we can while trying to be within the discipline parameters. What you’re seeing in the business is restaurant growth has been very strong. We’re continuing to drive margins there higher. You’re seeing very similar dynamic in both new verticals, as well as international. But not just the growth, but overall improvement in profitability has been higher. For us, whenever we think about a dollar of efficiency, the next step we think about is that back in the business, because you want to drive order rates higher, you want to drive scale higher. The scale ultimately drives efficiency. And that’s the consistent cycle that we’ve been on and nothing has changed in regards to how we operate the business. Ron Josey: Thank you, Tony. Thank you, Ravi. Operator: The next question comes from the line of Lee Horowitz from Deutsche Bank. Please go ahead. Lee Horowitz: Great. Thanks for the questions. In the past, you’ve called out fixed OpEx as a percentage of GOV for 2024 that’s expected to be stable. I guess, is that still the operating assumption that we should be thinking about for this year? And then sort of looking beyond this year, how are you thinking about sort of your ability to drive leverage on a go-forward basis as you digest sort of an admittedly small step in fixed OpEx? And then maybe just on the advertising business, I guess looking out to next year, you guys will have stacked up some really nice growth within your grocery business, which I assume would open up the eyes of some of your CPG ad partners. Would you expect sort of CPG ad participation in the advertising product, perhaps, lag some of the volume growth, as we’ve heard from some of your competitors in this space? Thanks so much. Ravi Inukonda: Hey, Lee. I’ll take the one on OpEx. Tony will take the second one. Look, I mean, our goal is not just to grow strongly in 2024, but our goal is to continue to drive strong growth for many years to come. For us, the key there is continue to innovate on the product side. What we’re seeing in the business is continue to invest behind the product. You’re seeing improvements in retention. You’re seeing improvements in order frequency. I mentioned earlier, the 2023 and the 2024 cohorts are as strong as any of the older cohorts we’ve seen. Our philosophy has always been to invest behind the strength that we’re seeing in the business. We are investing, we’re adding resources in select areas, mostly on the engineering and the product side. And I think the benefits of that from an overall growth, as well as an efficiency perspective. As I think about OpEx, I would expect OpEx roughly to be at the same level on a percentage of GOV basis for the rest of the year. I mean, looking forward, our goal is to continue to scale the business and our goal is to drive leverage in OpEx, just like any other part of the P&L. Tony Xu: Hey, Lee. On the second question about the pacing of CPG ad growth, I mean, we really like what we see, right? I mean, right now the focus, again, and it’ll always be this, is to make sure that the principle that building a great marketplace comes before building a great ad business. And if your marketplace business isn’t growing in a sustainable and healthy way, that’s not going to degrade the consumer experience, it almost doesn’t matter everything that comes after that sentence. And so, for us, I mean, to your point, you’re right. I mean, our new verticals, whether it’s grocery, convenience, alcohol, other retail categories, business is growing really fast. Every CPG is a customer and the question is like, how fast do we get into that spend? The way I think about this is, there’s no rush to doing it. And actually, you can actually make a pretty big mistake if you get into it too quickly. I mean, as long as we have the biggest audience with the greatest level of activity in terms of frequency engagement, retention and frequency, we’re always going to be available to the CPG advertiser. And I think they’re always going to be interested and they’re always looking for the best returns, and I think it tends to come from the marketplaces that aren’t the biggest — just the biggest, but also the ones with the highest activity and the highest growth rates. And so that’s the balance for us. I mean, our CPG ad business is growing really, really fast. I’m very pleased with the performance by the team. But again, in terms of pacing, I almost think of it as sequencing, which is the health of the marketplace should always come before the monetization of the marketplace. Lee Horowitz: Helpful. Thank you. Operator: The next question comes from the line of Shweta Khajuria from Wolfe Research. Please go ahead. Shweta Khajuria: Thank you for taking my question. Let me try two, please. One is on advertising growth. So could you talk about your current ad tech stack and where you are in terms of your product and where you think there is opportunity to continue to grow and gain greater share? That is whether you’re talking about attribution or you’re targeting capabilities or telling CPGs that we can get you incremental customers that you can’t find elsewhere, whatever that is, where are you today and where’s the opportunity? And second is on competitive dynamics. Through the quarter, there was a lot of talk about perhaps you potentially losing share. It clearly doesn’t sound like you are. Could you talk about the — whether you’re seeing greater competitive intensity in suburban markets in the U.S. and what you’re seeing in international markets? Thanks a lot. Tony Xu: Sure. I can take both of those and feel free, Ravi, to add in. Hey, Shweta, on the first question on ad tech stack and just where we are, I mean, it’s a three-year-old business. I mean, it’s growing lights out fast. I think if it were a standalone business, people would be very pleased with its performance. But again, to me, it’s not about rushing it. Even though it’s growing really, really fast and we’re in no disadvantage relative to anyone else, it doesn’t mean that we should just step on the gas all the way. So there’s a lot more room. I mean, if you look at where we started with ads, most of the stack was built for restaurants and that probably makes sense given our history. But DoorDash is no longer just a one-category, one-country company. We are five business lines, 30-plus countries. And so to your point, we have to evolve and build maturity in the stack for bigger restaurants, for CPG advertisers, for advertisers across all categories, not just in food, but in all of retail. So I think there’s a very long and straightforward roadmap. What I like is that, their — and certainly what they’ve told me and also what we see in terms of their investments with us is that they’re ready to go. And they’re always going to be there so long as we offer the best-in-class returns for them, which we believe derive from having the leading marketplace, both in terms of users as well as usage. And I think the rest will take care of itself. So we feel good about the growth there, but there’s a lot more to come. On the second question, I mean, to be candid, we haven’t really seen much change in the competitive landscape. I mean, there might be a lot of activity, but there’s not a lot of progress, if you know what I’m saying. I mean, I think it’s mostly noise that we’ve kind of heard. And I think that whether you look at new customer acquisition, you look at existing behavior, you still see that, at least in the eyes of the consumer, they seem to really prefer DoorDash. And I think what it speaks to is that you’re always going to have a lot of activity. We have seen — I’ve been doing this for over 11 years. I’ve seen periods of very high promotional activities, high partnership activity, high other forms of activity. But at the end of the day, the one thing that any marketplace or any consumer product is judged on is retention and frequency, and that’s something you can’t cheat. You can’t just game on a one-time basis. And all roads always point back to the marketplace that offers the best combination of selection, quality, price, and support. So far, we are — that marketplace, as long as we can continue our extension of our lead in the product. I feel really strong about our position, irrespective of activity. But I think it’s always been competitive. I expect it to always be competitive. But in terms of, like, what’s actually happening, whether it’s in suburban markets, urban markets, nothing’s really changed. Ravi Inukonda: Hey, Shweta. It’s Ravi. Just to add to… Shweta Khajuria: … the first point on ads, right? Like, I mean, we’re still very early in our journey, like Tony talked about, right? Like, you’re seeing the impact of ads on both revenue, as well as EBITDA, but the majority of the ad revenue is in the U.S. It’s mostly focused on restaurants at this point, still early from a CPG, as well as an international perspective. We’re holding our teams, you know, with the constraint on conversion as well as merchant relies, as long as those continue to be best-in-class, we’re going to continue to improve the overall ad business. Shweta Khajuria: Thanks, Ravi. Operator: The next question comes from the line of John Colantuoni from Jefferies. Please go ahead. John Colantuoni: Thanks for taking my questions. You added tens of thousands of new merchants to the U.S. marketplace. I’m curious how that additional supply compared between the restaurant delivery business and the verticals. And I know that just — that’s just one of a number of investments that you’re making to help drive improvements to the consumer offering, but I’m curious if you could help frame how much more room you have to continue expanding supply over time? And second question, just curious if you can quantify the impact of New York and Seattle, and the changes that you made there on GOV and EBITDA in the second quarter? Thanks. Tony Xu: Hey, John. It’s Tony. I’ll take the first one on adding selection and maybe, Ravi, you can take the second one. On adding selection, I mean, it’s really everywhere, John. I mean, there is no like one category we’re particularly targeting. I mean, we are trying to represent every city in a digital way, which means unless we have every breathing merchant that is alive in the city, we don’t have great selection. And so that’s really true. I mean, if you even were to drive out from any city center, our selection probably wanes as you go further out. And so I think we’ve got a long ways to go. And don’t forget also with restaurants, there’s always new restaurants coming in. One interesting fact about the restaurant industry and this is virtually true in every country, is that the total number of restaurants every year almost always exceeds the previous year, but it’s not necessarily the same set of restaurants. And that’s because restaurants come and go, and so there’s always a ton of work to do there. So the room to run on restaurants is almost this perennial kind of body of work. And then with retail, I mean, we’re just getting started. And so I think we have a long ways to go in terms of adding selection. Ravi Inukonda: John, on New York and Seattle, from an overall GOV perspective, I mean, the combination of both of those markets don’t make up a large portion from an overall company perspective. So the impact from GOV and volume from an overall company perspective has been small. Individual markets we’re seeing some elasticity, but not to impact the overall total company growth rate. From an EBITDA perspective, I mean, look, Q1, I mentioned that we did take a meaningful amount of impact on EBITDA from these costs. That cost did come down in Q2. A lot of that is being driven by improvements we’ve made on the product on the efficiency side. As we go through the rest of the year, I do expect the cost impact from an EBITDA perspective to go down. This was part of the reasoning I mentioned, causing H3 to be higher than H1, where we’re seeing impact from regulatory costs continue to reduce, as well as the volume continues to grow, as well as the gross profit for the various lines of business continue to grow as we go through the rest of the year. John Colantuoni: Thanks so much. Operator: The next question comes from the line of Mark Zgutowicz from The Benchmark Company. Please go ahead. Mark Zgutowicz: Thank you. Maybe switching gears a little bit, talking about price parity, obviously, an important topic. Doesn’t seem to get much progression, though, and I’m curious if you are close to any initiatives that might incentivize grocers to get there, possibly, like, prioritize ad placement, maybe what some of the puts and takes are there? And then maybe flipping the ad expansion discussion on its head. I’m curious where you have seen, maybe in certain verticals or environments, degradation in app engagement or order frequency as a result of increased ad load? Thanks. Tony Xu: Mark, it’s Tony. I’ll take both of those and feel free to add here, Ravi. Look, on price parity, I mean, you’re absolutely right that it’s an important point in terms of affordability, right? I mean, we’re always trying to make our products and services more affordable. That’s true in restaurants, that’s true in grocery, that’s true in convenience, that’s true across the Board. There’s no simple or silver bullet answer to your question. I mean, we’re constantly working to make sure that we can align the business model and the incentives such that we can offer the most accessible and affordable service. Now, look, all of this comes in conjunction with other things, right? It’s not hold — you can’t just hold one thing static. I mean, there’s a lot of other things that we have to do in terms of making sure that the inventory is actually there, making sure that if you didn’t get what you were hoping to get, that the substitution we made is perfect or acceptable to you. And so there’s a lot of things that have to come together for what you’re talking about. Price obviously is one component or one input in which we are judged. But there are so many other components too. And they sometimes interplay, right? As we find efficiencies in our logistics work, that’s worth it or if we can rip out inefficiencies that shouldn’t be in our system, those are costs that we can use to help fund other programs. And so there’s a lot going on. There’s no simple answer to your question. But it’s something that will be a perennial part of what we do. On the second question, I mean, it’s a great question, which is that you’re absolutely right that, ads do have an impact, a negative impact on the consumer experience. And it’s why I kind of harp on this all the time where you have to not be confused in terms of what drives what. And in this case, it’s a healthy marketplace that enables an ad business and not the other way around. And so this is one thing in which I think we’ve been more conservative on in making sure that we protect the consumer experience. And so, in terms of seeing degradation, we haven’t seen much of it, partly because of how we’re designing the system. Again, we’re super proud of, I think, our ad business. I think the size of the business would be impressive as a standalone company. But at the same time, we have to make sure the sequencing is right, where we are always making sure that we have the most engaged, the largest audience when it comes to local commerce. That will make it easy for everything else from an ad perspective. Mark Zgutowicz: That’s helpful. Thank you. Operator: Ladies and gentlemen, this concludes today’s Q&A session and today’s conference call. You may now disconnect. Thank you for your participation. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post DoorDash reports growth and expansion in Q2 2024 By Investing.com first appeared on Forex Trader Hub.

By Niket Nishant and Manya Saini (Reuters) – The next U.S. administration will be “constructive” on crypto regardless of which party wins, Coinbase (NASDAQ:) CEO Brian Armstrong said late on Thursday, underscoring the industry’s growing political influence ahead of the November election. The highly volatile crypto sector is seen as a risky fringe industry and has drawn intense scrutiny from the U.S. Securities and Exchange Commission, which has accused it of flouting securities laws. But support from Wall Street institutions and corporate titans like Elon Musk and the approval of U.S. exchange-traded crypto funds have boosted its mainstream appeal. The Republican and Democratic parties have also acknowledged the industry’s growing clout in recent weeks. “(Crypto) advocates are making their voices heard as an important voting bloc. Politicians on both sides of the aisle have taken notice, and there is growing momentum to pass comprehensive crypto legislation,” Armstrong told analysts. The largest U.S. crypto exchange is fighting the SEC in court after the regulator sued Coinbase last year alleging it failed to register as an exchange. Meanwhile, three major pro-crypto super political action committees – Fairshake, Defend American Jobs and Protect Progress – that did not exist until this election cycle – have raised more than $230 million to support friendly candidates. That campaign is moving the needle for both parties. Republican presidential candidate Donald Trump vowed to create a “stockpile” of bitcoin last week. Democratic vice president Kamala Harris’s advisers have also reached out to top crypto companies to “reset” relations, the Financial Times reported. “Donald Trump is pro-crypto which theoretically creates a tailwind for the industry if he wins,” Dan Coatsworth, investment analyst at AJ Bell told Reuters. “We don’t yet know Kamala Harris’ position but there are reports she could take a softer stance… than Joe Biden.” That would be major win for the sector, which for years warned that the SEC crackdown will push crypto entrepreneurs overseas. Mike Colonnese, an analyst at brokerage H.C. Wainwright & Co, said a regulatory shift “has the potential to bring a new wave of institutional capital into the space that would’ve otherwise been sidelined”. ‘CHEVRON DEFERENCE’ Coinbase CEO Armstrong lauded a recent Supreme Court decision that overturned a doctrine called “ Chevron (NYSE:) deference” that had called for judges to defer to federal agency interpretations of laws deemed to be ambiguous. Widely viewed as a blow to federal agency powers, the ruling said it is the job of courts, not agencies, to interpret laws. “We see this case as a sign of Supreme Court skepticism to agency overreach, which we view as a positive overall for our industry,” said Armstrong, a vocal critic of the SEC. Coinbase last month added to its board former U.S. Solicitor General Paul Clement, a lead lawyer on the case which led to the Chevron ruling. “Shifts in the U.S. election landscape and the Supreme Court’s overturning of the long-standing Chevron precedent has changed our view on Coinbase’s regulatory risks,” analysts at Citigroup wrote in a note last month. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Coinbase expects US to be crypto-friendly irrespective of election outcome By Reuters first appeared on Forex Trader Hub.

By Sabrina Valle and Mrinalika Roy (Reuters) -Chevron reported second-quarter earnings on Friday that missed Wall Street estimates due to industry-wide pressure from lower refining margins and prices, sending its shares down 1.5% in premarket trading. The company earlier had warned oil output this quarter would slip and refining would suffer from turnarounds at two refineries in California. Refining margins have been weak globally, hurting other oil majors like BP (NYSE:) and Shell (LON:). Chevron (NYSE:) said it would relocate the company’s headquarters from San Ramon, California, where it was born 145 years ago as Pacific Coast Oil Co, to Houston. The company has been bitterly contesting state regulations on its oil producing and refining operations in the state. Chevron reported earnings of $4.4 billion, or $2.43 per share, in the quarter, compared with $6 billion a year before. It reported adjusted earnings of $4.7 billion, or $2.55 per share. Wall Street analysts expected earnings per share of $2.93, according to LSEG data. Earnings from pumping oil and gas were down 9.4% from a year earlier. Profit from producing gasoline and chemicals was also down about 60% to $597 million. “Despite recent operational downtime and softer margins, we remain poised to deliver significant long-term earnings and cash flow growth,” CEO Mike Wirth said. REFINING MARGINS Oil refiners made less money selling gasoline in the second quarter after two years of stellar profits and after ramping up production for demand that never materialized. Lower refining margins drove Shell’s profits down 19% from the previous quarter to $6.3 billion. Refining margins also limited BP forecast-beating $2.8 billion profit and contributed to TotalEnergies (EPA:)’s 6% earnings drop. Chevron had predicted liquefied natural gas (LNG) prices of about $10 per million metric tons and they have been run higher, at about $12, on strong demand. The gains could help its LNG margins. DEAL DELAY The downbeat results come as its proposed $53 billion acquisition of oil producer Hess (NYSE:) has been stalled. On Wednesday, the company said an arbitration panel that will evaluate a challenge to the deal from Exxon Mobil (NYSE:) likely will not have a decision until the second half of next year. Exxon expects a decision on the dispute by September 2025, Chief Financial Officer Kathryn Mikells told Reuters. “I can confirm (the hearing) at that end of May 2025. And there is an expectation of a ruling by September of 2025”, she said. The delay prompted speculation over potential talks between Exxon and Chevron to reach a settlement sooner. “Given the much later anticipated arbitration hearing timeline, I would think there is an incentive for Hess and Chevron to try to provide some sort of sweetener to Exxon to make this go away,” said Frederic Boucher, risk arbitrage analyst at Susquehanna Financial Group. Exxon’s CFO declined to comment on whether the companies were engaged in side negotiations.Chevron shares have underperformed both Exxon and the this year as it struggles to conclude the deal, which would give it a stake in a Guyana joint venture that has found more than 30 significant oil discoveries. Chevron is counting on this deal to establish a foothold in Guyana’s lucrative oil reserves and help mitigate risks associated with its performance-challenged oil and gas operations in Australia and Kazakhstan. CALIFORNIA California’s oil output a century ago amounted to it being the fourth-largest crude producer in the U.S. But oil majors have been phasing out of the state amid stricter climate regulations and depleting oil fields. Chevron expects all corporate functions to migrate to Houston over the next five years. Positions in support its California operations, which includes oil fields and two refineries, will remain in San Ramon. Chevron CEO Wirth and Vice Chairman Mark Nelson will move to Houston before the end of 2024, the company said. Chevron currently has roughly 7,000 employees in the Houston area and about 2,000 employees in San Ramon. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Chevron reports Q2 earnings miss on weak refining margins By Reuters first appeared on Forex Trader Hub.

BEIJING (Reuters) – Tesla (NASDAQ:) registered an insurance broking firm in China at the end of July, based on a national corporate information database, in a sign that the U.S. automaker may be trying again to gain approval to sell insurance products in the country. The new company, located in Beijing’s Central Business District, was set up on July 30 with a registered capital of 50 million yuan ($6.92 million), the National Enterprise Credit Information Publicity System showed. Tesla had sought regulatory approval to sell insurance products in China more than three years ago when it had registered a company in 2020 but removed that registration in April this year. Electric vehicles are expensive to repair, posing a challenge to insurance providers accustomed to the demands of conventional combustion engine vehicles. By selling insurance directly to consumers, Tesla could potentially offer lower-cost EV insurance products, which are usually more expensive than those for gasoline cars. Tesla did not immediately respond to a Reuters request for comment. Tesla’s biggest Chinese rival BYD (SZ:) was approved to take over a bankrupt online insurance unit Yi’an P&C Insurance Co last May. China, Tesla’s second largest market, has increased its support for the U.S. carmaker, which plans to build a data training centre and roll out its Full Self Driving software in the country this year, despite ongoing tensions with the United States over tech rivalry. Tesla won an endorsement from the country’s top auto industry association that said in April the data collection by Tesla fleets in China was compliant. Since then, Tesla cars have been allowed to enter some government and military compounds where they were previously banned. ($1 = 7.2204 renminbi) !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Tesla registers insurance brokerage in China, national corporate database shows By Reuters first appeared on Forex Trader Hub.

WASHINGTON (Reuters) -A U.S. military Osprey aircraft crash off the coast of Japan in November that killed all eight crew members was caused by a failure in the gear box and the pilot’s decision making contributed to it, an Air Force investigation released on Thursday said. The U.S. military grounded its fleet of V-22 Osprey aircraft for months after the fatal crash, which happened during a routine training mission on Nov. 29 off Yakushima Island, about 1,040 km (650 miles) southwest of the capital, Tokyo.    “The mishap was caused by a catastrophic failure of the left-hand prop rotor gear box… decision-making was causal, prolonging the mishap sequence,” the investigation said.     It said that the crew did not have a sense of urgency when they received warnings in the aircraft.     The pilot of the Osprey had received an advisory to “Land as Soon as Practical” when the aircraft was still close to mainland Japan and could have diverted to several closer airfields.     The investigation added that the pilot continued to fly at 8,000 feet above sea level, even though it would have been prudent to fly below the clouds present. Although the deployment of the Osprey in Japan has faced opposition in the past, the Japanese government said it accepted the findings of the report and believed further accidents could be prevented. “We have confirmed at all levels between Japan and the U.S. that ensuring flight safety is the top priority, and we intend to continue to cooperate with them to ensure such safety,” Chief Cabinet Secretary Yoshimasa Hayashi told a regular press briefing on Friday. At least 400 multipurpose Ospreys have been delivered and are mainly used by the U.S. Air Force, Marines and Navy in Japan and elsewhere, according to Boeing (NYSE:), which manufactures the Osprey along with Textron (NYSE:)’s Bell Helicopter unit. The U.S. Navy aircraft carrier deployed to Japan, the USS Carl Vinson, relies on them to deliver some supplies and personnel. According to the Flight Safety Foundation, at least 50 personnel have died in crashes operating or testing the aircraft. More than 20 of those deaths came after the V-22 entered service in 2007. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Deadly Osprey crash caused by mechanical failure, pilot error, US Air Force says By Reuters first appeared on Forex Trader Hub.

EUR/USD slipped back below 1.0800 as bearish pullback gains strength. Mixed US data reignited fears over a possible recession in the US. US NFP jobs report in the pipe for Friday, market attention fixed squarely on hiring numbers. EUR/USD lost a foothold above key technical levels on Thursday, slumping below the 1.0800 handle after a miss in US Purchasing Managers Index (PMI) figures sparked fresh fears of worsening economic data signaling the possibility of a hard landing scenario in the US economy. Forex today: Markets’ attention shifts to US NFP European economic data remains thin for what’s left of the trading week, and next week sees little of note on the meaningful release side for the EU as broader markets pivot to fully face down Friday’s US Nonfarm Payrolls (NFP) jobs report for July. Investors hope for a moderate drop to 175K new US jobs in July from 206K last month. Too high of a print could splash cold water on rate cut hopes for September, while too low of a figure would add further weight to concerns of a too-fast economic decline dragging the US economy into a recession. Markets are struggling to balance on the edge of a very sharp knife as a downturn in economic figures is helping to pin rate cut expectations even further into the ceiling. According to the CME’s FedWatch Tool, rate traders are pricing in 100% odds of at least a quarter-point rate cut from the Fed on September 18, with further one-in-five odds of a double-cut for 50 basis points. On the downside, too much of a downturn will obliterate market sentiment as a hard landing economic scenario for the US economy makes any rate cuts from the Fed irrelevant, and investors are strung along a difficult middle ground where they hope for rate cuts on soft data, but not so soft that the US economy rolls over. US Initial Jobless Claims for the week ended July 26 rose to 249K from the previous week’s 235K, lurching past the forecast uptick to 236K. July’s US ISM Manufacturing Purchasing Managers Index (PMI) tumbled to an eight-month low of 46.8 compared to the previous 48.5 and entirely reversing the forecast move up to 48.8. On the other side of the same coin, ISM Manufacturing Prices Paid in July accelerated to 52.9 versus the previous 52.1 and entirely missing a forecast easing to 48.8 as input prices for manufacturers drift higher than markets anticipated even as activity declines. Economic Indicator Nonfarm Payrolls The Nonfarm Payrolls release presents the number of new jobs created in the US during the previous month in all non-agricultural businesses; it is released by the US Bureau of Labor Statistics (BLS). The monthly changes in payrolls can be extremely volatile. The number is also subject to strong reviews, which can also trigger volatility in the Forex board. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish, although previous months’ reviews ​and the Unemployment Rate are as relevant as the headline figure. The market’s reaction, therefore, depends on how the market assesses all the data contained in the BLS report as a whole. Read more. EUR/USD technical outlook The Fiber’s downside performance sent the pair tumbling below the 200-day Exponential Moving Average (EMA) at 1.0805, and dragged bids back under the 1.0800 handle as a bearish turnaround in EUR/USD grows its legs, sinking the Euro into a -1.56% decline against the Greenback. EUR/USD set a near-term high of 1.0948 in recent weeks, falling just short of the 1.0950 level and price action has once again slumped within the range of a choppy descending channel that has plagued the chart since late last year. EUR/USD daily chart Euro FAQs The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%). The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money. Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy. Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.   Source link The post EURUSD falls below key technical levels with US NFP in the barrel first appeared on Forex Trader Hub.

The Digital Chamber, a prominent digital asset advocate in the United States, is calling on US lawmakers to vote in favor of the Bitcoin reserve bill recently introduced by Wyoming Senator Cynthia Lummis. In an Aug. 1 post on X, the lobby group said it is hand-delivering a letter to “every US Senator,” which will explain that adding Bitcoin (BTC) to America’s balance sheet can secure its position as a “global leader” and provide more stability in the face of “global economic uncertainties.” Lummis introduced the Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide Act of 2024 (or Bitcoin Act of 2024) on July 31. This bill would see the US Treasury set up Bitcoin vaults and buy 1 million Bitcoin over five years. Notably, the bill would help the US hedge against inflation and economic volatility, The Digital Chamber’s Chief Policy Officer Cody Carbone told Senators in the letter. The Digital Chamber’s letter to US Senators. Source: The Digital Chamber Carbone backed this claim up by highlighting Bitcoin’s hard-cap supply of roughly 21 million units, making it scarce and resistant to inflationary pressures: “By reducing our reliance on traditional fiat currencies and diversifying our reserves, we can create a more robust and adaptable financial system that is better equipped to navigate future economic challenges.” The letter comes four days after the US national debt surpassed the $35 trillion mark. Lummis isn’t the only US politician pushing for the country to put Bitcoin on the country’s balance sheet. At the recent Bitcoin 2024 conference in Nashville, independent candidate Robert F. Kennedy Jr. promised he would make the US Treasury buy 500 Bitcoin every day until it reached at least 4 million Bitcoin. At the same event, Republican candidate Donald Trump announced plans to build a strategic national Bitcoin stockpile. Related: Bitcoin ‘explosive move’ looms as Bollinger Bands reach tightest points The US has seen more bipartisan support on cryptocurrency-related matters in recent months. The Financial Innovation and Technology for the 21st Century Act passed the House on May 22 with 71 Democrats and 208 Republicans in favor and is now awaiting a vote in the Senate. Both chambers voted to overturn the US securities regulator’s Staff Accounting Bulletin 121 rule too. However, it was later vetoed by President Joe Biden and an attempt to override Biden’s veto also failed, which didn’t garner two-thirds majority support in the House during a second vote. Industry pundits claim that if SAB 121 had been passed, it would have made it easier for US banks to custody cryptocurrency exchange-traded products. Magazine: El Salvador’s national Bitcoin chief has been orange-pilling Argentina Source link The post Digital Chamber urges US senators to support Lummis’ Bitcoin reserve bill first appeared on Forex Trader Hub.

By Jody Godoy (Reuters) – The U.S. Federal Trade Commission will probe why grocery prices remain high even as costs for retailers fall, Chair Lina Khan said on Thursday, a key theme for the Biden-Harris administration as it heads towards the presidential election. Once the FTC votes to authorize the study, major grocery chains would be ordered to provide information on their costs and prices on common products. Khan made the announcement at a public meeting with Justice Department officials on pricing practices. The biggest U.S. industry players include Walmart (NYSE:); club grocery chain Costco Wholesale Corp (NASDAQ:); Amazon.com (NASDAQ:), which operates Whole Foods; and big box retailer Target. Food prices have risen 25% between 2019 and 2023, faster than other consumer goods and services, U.S. Department of Agriculture statistics showed. An FTC study showed food prices for U.S. consumers rose 11% between 2021 and 2022, while profits for food retailers went up more than 6%. “We want to make sure that major businesses are not exploiting their power to inflate prices for American families at the grocery store,” Khan said. The FTC has played a major role in the Biden administration’s efforts to cut costs for U.S. households, targeting high prices and junk fees on products and services ranging from airfare to credit cards. Billionaire Democratic donors, some affiliated with businesses the FTC has sued, have urged Vice President Kamala Harris, the Democratic presidential nominee, to replace Khan if elected. The agency last week launched an inquiry into services that could let companies set different prices based on the shopper’s personal information. The FTC earlier this year sued to block Kroger (NYSE:)’s acquisition of smaller grocery store rival Albertsons (NYSE:), citing concerns the deal would hike prices for millions of Americans. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post US targets surging grocery prices in latest probe By Reuters first appeared on Forex Trader Hub.

By Nora Eckert DETROIT (Reuters) – General Motors (NYSE:) is changing the way it rates the performance of its salaried employees in the U.S. in a move to better reward high-performers and put pressure on low-performers to improve or leave. According to an internal memo viewed by Reuters, the Detroit automaker is now rewarding its top 5% of employees with 150% bonuses, higher than what was available in the previous system, to better attract and retain the talent needed to achieve its goals in the cut-throat automotive transformation to electric vehicles. “To ensure GM has the talent needed to achieve our ambitious goals, a more intentional process is required that sets clear expectations for performance and holds people accountable,” the memo said. Legacy automakers like GM and Ford (NYSE:) have been tweaking their performance evaluation systems for U.S. salaried employees to better compete with the stock-heavy pay packages of EV rivals like Tesla (NASDAQ:) and Rivian (NASDAQ:). GM’s new performance ranking system evaluates employees on a five-scale system, from “significantly exceeds expectations” to “does not meet expectations.” Employee bonuses are tied to their ranking. “GM is proud to have a culture where we foster and reward high performance, which will help us attract and retain top talent in a competitive industry environment. That includes everything from ensuring employees know what is expected of them, providing feedback so they can develop, and rewarding them for their performance,” a GM spokesman said. GM employees will be evaluated on the updated rankings during their year-end performance review, the spokesman said. Ford CEO Jim Farley said in February that changing the company’s performance review system to make bonuses more tied to creating shareholder value has been an important part of its business transformation. “We’ve learned that the right talent is not sufficient. Over the last two years, it’s been imperative that we go to a right performance management system. It’s a fundamental change in the way we’re running the company,” Farley told analysts on the earnings call earlier this year. The new GM system adds a top and bottom tier to the previous three-category one, which separated employees into “partially meets expectations,” “achieves expectations” or “exceeds expectations.” In the new rankings, GM estimates about 70% of the organization would land in the “achieves” middle category, receiving 100% of their target bonuses. The estimated 5% of the “does not meet expectations” category would be subject to what the company calls “appropriate action … including being exited from the company.” Major automakers have been in cost-cutting mode to preserve funds amid the expensive EV transition, slimming down their white-collar ranks in the process. GM offered buyouts to most of its salaried employees in March 2023, and in May of that year cut several hundred full-time contract workers. Ford and Stellantis (NYSE:) have also cut their ranks over the last year. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Exclusive-GM raises bar for employee performance with new ratings system By Reuters first appeared on Forex Trader Hub.

(Updated – August 1, 2024 11:44 AM EDT) Investing.com — U.S. stock futures declined Thursday after a measure of U.S. manufacturing activity dropped to an eight month low. Here are some of the biggest U.S. stock movers today: Meta Platforms (NASDAQ:) stock fell 6.3% after the Facebook-parent reported stronger-than-expected second-quarter earnings and also presented a robust outlook. Arm Holdings (ARM) stock fell 15% after the chip designer offered up a conservative revenue forecast, sparking worries that returns from a spending frenzy on AI computing would be relatively slow to materialize. Moderna (NASDAQ:) (MRNA) stock slumped 18% after the drugmaker cut its full-year revenue guidance, citing low EU sales and a competitive vaccine environment in the U.S.. ConocoPhillips (NYSE:) stock fell 2% despite the oil and gas producer posting a second-quarter profit that beat estimates, benefiting from higher output and oil prices. Ferrari (NYSE:) stock rose 2% after the Italian luxury car manufacturer raised its forecasts for its full-year revenues core earnings, after it beat estimates in the second quarter. Labcorp (LH) stock rose 6% after the lab operator beat expectations for second-quarter profit and revenue on strong demand for its diagnostic tests, and raised its sales growth forecast for the year. Spirit Airlines (NYSE:) (SAVE) stock fell 7% after the carrier forecast its current-quarter revenue below estimates, as excess capacity and intense competition on its routes hamper its pricing power. Biogen (NASDAQ:) stock fell 1.7% despite the drugmaker lifting its full-year earnings forecast, as the launch of new treatments and its cost-cutting program are expected to make up for falling sales of its older multiple sclerosis medicines. Mobileye Global (NASDAQ:) (MBLY) stock fell 19% after the automotive tech company cut its annual revenue and profit forecasts, blaming volatile demand for its driver-assistance chips in China. Eli Lilly (NYSE:) rose 3% after its drug Zepbound demonstrated significant long-term health benefits for patients with obesity-related heart failure. Carvana (CVNA) rose 9% after reporting strong revenue and operating profit in the second quarter. Analysts raised their price target on the stock today. Western Digital (NASDAQ:) fell 11% despite beating estimates for second quarter EPS, as guidance trailed consensus estimates. Its poor performance triggered analysts to downgrade the stock. Additional reporting by Louis Juricic !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Meta Platforms, Lilly rise; Arm, Moderna fall By Investing.com first appeared on Forex Trader Hub.

(Reuters) -U.S. oil and gas producer ConocoPhillips (NYSE:) posted a second-quarter profit that beat Wall Street estimates on Thursday, benefiting from higher output and oil prices. The beat comes as ConocoPhillips is pursuing a $22.5 billion takeover of Marathon Oil (NYSE:), one of the largest deals of the quarter that is currently under review by the Federal Trade Commission. The combination would create a company pumping 2.26 million barrels of oil and gas per day, and add 1.32 billion barrels of proved reserves to ConocoPhillips’ 6.8 billion. However, ConocoPhillips’ third-quarter production is expected to be lower than that in the second quarter due to the impact of planned turnarounds in Canada, Lower 48, Alaska, Norway, Malaysia and Qatar. It forecast its full-year output to be between 1.93 million and 1.94 million barrels of oil equivalent per day (boepd), compared with its prior range of 1.91 million to 1.95 million boepd. Still lower than its second-quarter production, which rose to 1.95 million boepd from 1.81 million boepd in the year-ago quarter. The company updated its capital expenditure for the year to reflect progress on its project in Alaska and increased Lower 48 partner-operated activity. ConocoPhillips’ total average realized prices rose 4% to $56.56 per barrel of oil equivalent (boe) in the reported quarter. The Houston, Texas-based company posted adjusted earnings of $1.98 per share for the quarter ended June 30, compared with analysts’ average estimate of $1.96, according to LSEG data. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post ConocoPhillips beats Q2 profit on higher oil production, prices By Reuters first appeared on Forex Trader Hub.

Marriott International, Inc. (NASDAQ: NASDAQ:) reported a solid performance in the second quarter of 2024, with significant growth in net rooms and global revenue per available room (RevPAR). The company’s net rooms increased by 6% year-over-year, and global RevPAR rose nearly 5%, driven by a 3% increase in average daily rates and occupancy levels reaching 73%. Despite a decline in Greater China’s RevPAR due to macroeconomic challenges, Marriott saw strong international growth, particularly in the Asia Pacific region, excluding China. The company also adjusted its full-year RevPAR growth outlook to 3-4% and expects to return approximately $4.3 billion to shareholders. Key Takeaways Marriott International’s net rooms grew by 6% YoY, with a global RevPAR increase of nearly 5%. The company’s loyalty program now boasts over 210 million members. Approximately 15,500 net rooms were added in Q2, with a pipeline of over 559,000 rooms. Gross fee revenues and adjusted EBITDA rose by 7% and 9%, respectively. Full-year global RevPAR growth outlook was narrowed to 3-4%. Marriott plans to return about $4.3 billion to shareholders for the full year. Company Outlook Marriott expects Q3 global RevPAR growth of 3-4% and full-year adjusted EBITDA to increase by 6-8%. The company’s full-year net rooms growth projection is 5.5-6%. Plans are in place to continue investing in growth while maintaining an investment grade rating. Bearish Highlights RevPAR in Greater China dropped by roughly 4%, impacted by macroeconomic pressures. Full-year gross fee guidance was lowered by $50 million to $100 million from earlier forecasts. The company noted softer ancillary spend than anticipated, indicating possible consumer spending caution. Bullish Highlights Strong growth was seen in the loyalty program and global room nights. Marriott’s pipeline and room additions outpaced overall industry supply. Leisure travel continues to grow, particularly in the upper chain scales. Misses The company cited negative currency impacts from a strong dollar and lower non-RevPAR related franchise fees. Incentive management fees (IMFs) in Greater China and select markets in the US and Canada were lower than expected. Q&A Highlights CEO Tony Capuano discussed the increasing momentum in conversions and adaptive reuse projects, particularly in Greater China. CFO Leeny Oberg addressed the lower ancillary spend across leisure and group segments, while also noting that credit card spend continues to rise. The company is strategically using its balance sheet for deals with significant fee upside, now considering opportunities lower in the quality tier framework. Marriott International’s strong Q2 performance showcases resilience in the face of global economic pressures. The company’s strategic adjustments and focus on growth, despite challenges in specific markets like Greater China and the US, reflect a commitment to long-term success and shareholder value. Marriott’s continued expansion and loyalty program strength position it well for ongoing industry leadership. InvestingPro Insights Marriott International’s (NASDAQ: MAR) latest quarterly results have been bolstered by a robust gross profit margin and a promising outlook for profitability. According to InvestingPro data, the company’s gross profit margin in the last twelve months as of Q1 2024 stood at an impressive 81.65%, indicating strong operational efficiency and cost management. Investors should note that while Marriott’s P/E ratio is on the higher side at 23.58, this reflects the market’s confidence in the company’s earnings potential. The adjusted P/E ratio for the same period is slightly more favorable at 21.02, suggesting that the company’s earnings may be more attractive when considering normalized conditions. Additionally, Marriott has been focusing on shareholder returns, as evidenced by a dividend yield of 1.06% and a notable dividend growth of 57.5% in the last twelve months as of Q1 2024. This aligns with the company’s commitment to return approximately $4.3 billion to shareholders. InvestingPro Tips for Marriott International highlight management’s aggressive share buyback strategy and the company’s impressive gross profit margins. Furthermore, analysts predict Marriott will be profitable this year, and the company has indeed been profitable over the last twelve months. These factors not only underscore Marriott’s financial health but also its strategic initiatives to enhance shareholder value. For investors looking for deeper insights, there are over 10 additional InvestingPro Tips for Marriott International available at https://www.investing.com/pro/MAR, providing a comprehensive analysis of the company’s financial metrics and market performance. Full transcript – Marriott Intl (MAR) Q2 2024: Operator: Good day everyone and welcome to today’s Marriott International Q2 2024 Earnings. At this time, all participants are in a listen-only mode. Later you will have the opportunity to ask questions during the question-and-answer session. [Operator Instructions] Please note this call is being recorded. I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Senior Vice President, Investor Relations, Jackie McConagha. Jackie McConagha: Thank you. Good morning and welcome to Marriott’s second quarter 2024 earnings call. On the call with me today are Tony Capuano, our President and Chief Executive Officer; Leeny Oberg, our Chief Financial Officer and Executive Vice President, Development; and Betsy Dahm, our Vice President of Investor Relations. Before we begin, I would like to remind everyone that many of our comments today are not historical facts and are considered forward-looking statements under federal securities laws. These statements are subject to numerous risks and uncertainties as described in our SEC filings, which could cause future results to differ materially from those expressed in or implied by our comments. Unless otherwise stated, our RevPAR occupancy average daily rate and property level revenues comments reflect system-wide constant currency results for comparable hotels and all changes refer to year-over-year changes for the comparable period. Statements in our comments and the press release we issued earlier today are effective only today and will not be updated as actual events unfold. You can find our earnings release and reconciliations of all non-GAAP financial measures referred to in our remarks today on our Investors Relations website. And now I will turn the call over to Tony. Tony Capuano: Thanks, Jackie, and good morning everyone. We delivered another strong quarter as travel demand remained robust in most markets around the world. And our net rooms grew by 6% year-over-year. Second quarter global RevPAR rose nearly 5%. Average daily rate increased around 3% and occupancy reached 73%, up about 150 basis points compared to last year’s second quarter. RevPAR rose nearly 4% in the US and Canada, benefiting from the shift of the Easter holiday. All chain scales in the US and Canada, from select service to luxury, posted positive second quarter year-over-year RevPAR. RevPAR increased over 7% internationally, led by a remarkable 13% RevPAR gain in Asia Pacific excluding China or APEC. APEC benefited from strong macro trends and increased cross-border travel, especially from Mainland China. Growth in APEC was broad-based but particularly robust in Japan where RevPAR rose 21%. RevPAR grew nearly 10% in the EMEA region with continued strong regional and cross-border demand and about 9% in the CALA region. To date in 2024, the City Express portfolio has meaningfully outperformed the overall Mexican market as well as our own internal RevPAR expectation, and Bonvoy penetration of the hotels continues to improve steadily. RevPAR in Greater China declined roughly 4% in the quarter, as macroeconomic pressures led to softer domestic demand. The region was also impacted by an increase in outbound high-end travelers. Positive RevPAR growth in Tier 1 cities, Hong Kong, Macau, and Taiwan was more than offset by declines in all other markets, with Hainan seeing a meaningful RevPAR decline. Despite the adverse market conditions, we outperformed our peers and gained RevPAR index across the region in the second quarter. Our global RevPAR index, which is at a substantial premium, also rose again in the quarter. As we look ahead to the full year, we are narrowing our global RevPAR range to 3% to 4% growth, largely due to anticipated continued weakness in Greater China, as Leeny will discuss in more detail. On a global basis, in the second quarter, we saw RevPAR growth across all three of our customer segments, group, leisure transient, and business transient, with each segment experiencing increases in both room nights and average daily rate. Group, which comprised 24% of worldwide room nights in the quarter, remained the strongest customer segment. Compared to the year-ago quarter, group RevPAR rose 10% globally. Full-year 2024 worldwide group revenues were still pacing up 9% year-over-year at the end of the second quarter, with a 5% increase in room nights and a 4% rise in ADR. Business transient, which contributed 33% of global room nights in the quarter, saw a 4% increase in RevPAR. Leisure transient, which accounted for 43% of worldwide room nights in the quarter, posted a 2% rise in RevPAR. Within the business transient segment, demand from small and medium sized corporates, which now account for nearly 55% of business transient room nights, has grown significantly over the last few years. Earlier this month we announced Business Access by Marriott Bonvoy, a new comprehensive online booking travel program that we launched to ease and expand the booking experience and travel management process for these customers. While it is still early days, this new offering is already seeing great interest, and we’re extremely pleased with the initial account signups and users of the platform, both of which have outpaced expectations. We continue to enhance our powerful Marriott Bonvoy loyalty program, which had over 210 million members at the end of June. We continue to see real success driving enrollments and engagement internationally, in part due to our Bonvoy partnerships with Rakuten in Japan, Alibaba (NYSE:) in China, and Rappi in CALA. Member penetration of global room nights rose again, reaching new record highs in the second quarter at 71% in the US and Canada, and 65% globally. Our new collaboration with Starbucks (NASDAQ:) is the latest example of how we’re connecting our members with people, places, and passions that they truly love. We also remain laser focused on providing our guests with excellent experiences in our hotels and are pleased with our intent to recommend sports which have continued to steadily rise. Our leading global portfolio continues to grow meaningfully faster than overall industry supply and we added approximately 15,500 net rooms to end the quarter with nearly 1.66 million rooms. Global signing activity has remained strong. Record signings in APEC and Greater China for the first half of the year helped grow our pipeline to over 559,000 rooms around the world. Conversions, including multi-unit opportunities, remain a significant driver of growth as owners continue to value the depth and breadth of our brand portfolio and our powerful revenue engines. In the second quarter, conversions represented 37% of openings and 32% of signings. This conversion activity has been broad based with hotels converting into 23 different Marriott brands over the last 12 months. While still below 2019 levels, we’re also pleased with the continued upward trend in monthly construction starts. In the second quarter, construction starts in the US and Canada rose 40% year-over-year. In June, we signed three marquee luxury conversion deals in the US. The renowned, The Resort at Pelican Hill in Newport Beach, California, and The Luxury Collection Hotel Manhattan Midtown have already joined our system. The iconic Turtle Bay Resort in Hawaii is joining the Ritz-Carlton brand today. We are thrilled to welcome these incredible properties as we further extend our global leading position in the high value luxury segment. Our momentum in the mid-scale space is excellent. Developers are showing significant interest in our new brands in the tier. City Express by Marriott, Four Points Express by Sheraton, StudioRes, and our latest transient conversion friendly brand in the US. In CALA, we continue to sign deals for City Express and are engaged in numerous discussions across the region. Our first Four Points Express opened in Turkey and over a dozen hotels from our recent multi-unit conversion deal in APEC are expected to join our system later this year. We’re also in talks for StudioRes hotels in over 300 markets and we continue to execute on and pursue numerous types of opportunities, from large development deals to one-off projects. Before I turn the call over to Leeny to discuss our financial results, I want to say thank you to all of our associates around the world for the hard work they do each and every day to advance our business and help connect people through the power of travel. Leeny? Leeny Oberg: Thank you, Tony. Second quarter gross fee revenues rose 7% year-over-year to $1.34 billion. The increase reflects stronger global RevPAR, rooms growth, and a higher non-RevPAR related franchise fees. Co-branded credit card fees rose 10%, and residential branding fees were significantly higher than in the same quarter last year, as we continue to benefit from our top position in branded residences globally. Incentive management fees, or IMFs, totaled $195 million in the second quarter. Growth in these fees was led by mid-teens percentage increases in APEC and EMEA, partially offset by an $8 million decline in Greater China. IMFs in the US and Canada were flat year-over-year, in part impacted by continued softness in Hawaii. Second quarter adjusted EBITDA grew 9% to $1.32 billion, and adjusted EPS increased 11% to $2.50. Now, let’s talk about our outlook for 2024. Global RevPAR is expected to grow 3% to 4% in the third quarter and for the full year. RevPAR growth is expected to remain higher in the vast majority of our international markets than in the US and Canada. The primary change in our four-year outlook is Greater China’s updated expectation of negative RevPAR growth for the rest of the year. We expect a continuation of current weak demand and pricing trends in the region, with the third quarter anticipated to see the most meaningful RevPAR decline as outbound travel accelerates during summer holidays. Note that given Greater China’s lower overall average RevPAR compared to the rest of our system, it typically makes up around 7% of RevPAR-related fees, although it accounts for 10% of open rooms. While we also expect marginally lower full-year RevPAR in the US and Canada than we had previously anticipated, in part due to less group business the first two weeks of November, given the intense focus on the US presidential election, overall RevPAR trends in the US and Canada in the back half of the year are expected to remain relatively steady with the first six months of the year. On customer segment, worldwide RevPAR growth is still anticipated to be driven by another year of strong growth in group revenue, continued improvement in business transient revenues, and slower but still growing leisure revenues. In the third quarter, gross fee growth is expected to be in the 6% to 8% range. Our owned lease and other revenues net of expenses are anticipated to be roughly $75 million. For the full year, gross fees could rise 6% to 7% to $5.1 billion to $5.2 billion. Compared to last quarter’s expectations, roughly two-thirds of the reductions is from IMFs, largely from Greater China and select markets in the US and Canada like Hawaii and Washington, DC. There’s also additional negative currency impact from a still strong dollar, as well as well as slightly lower than previously expected non-RevPAR related franchise fees, and the timing of hotel openings. Owned, leased and other revenues, net of expenses, could now total $345 million to $350 million. We now expect full year G&A expense could rise just 1% to 2% year-over-year. Full year adjusted EBITDA is now expected to rise between 6% and 8% to roughly $4.95 billion to $5 billion. Our 2024 effective tax rate is expected to be just above 25%. 2024 adjusted EPS is now expected to be between $9.23 and $9.40. As Tony mentioned, we’re very pleased with the robust signings and openings activity across our global portfolio, demonstrating owners and franchisees continued confidence in our brand’s performance. We’re focused on driving strong growth and still expect full-year net rooms growth of 5.5% to 6%. Full-year investment spending is still expected to total $1 billion to $1.2 billion. As you’ll recall, this spending includes higher than historical investment in technology associated with the multi-year transformation of our property management, reservations, and loyalty systems, the vast majority of which is expected to be reimbursed over time. We look forward to the many benefits expected to accrue from elevating our three major tech platforms. Our investment spending outlook also incorporates roughly $200 million for our owned lease portfolio, including renovation spending for the W Union Square in Manhattan and the Elegant portfolio in Barbados. When all renovations are complete, we’ll ultimately look to recycle these assets and sign long-term management contracts for these properties. Our capital allocation philosophy remains the same. We’re committed to our investment grade rating, investing in growth that is accretive to shareholder value, and then returning excess capital to shareholders through share repurchase and a modest dividend, which has risen meaningfully over time. We continue to generate strong levels of cash, including from our loyalty program, and our leverage ratio remains at the low end of our target range of 3 times to 3.5 times debt to EBITDA. We currently expect approximately $4.3 billion of capital returns to shareholders for the full year. This factors in the $500 million of required cash in the fourth quarter for the purchase of the Sheraton Grand Chicago. In closing, we have a lot of momentum in our business and strong growth prospects across our over 30 brands around the world, thanks to our terrific team. As we look ahead, we’re incredibly optimistic about Marriott’s future. Tony and I are now happy to take your questions. Operator? Operator: Thank you. [Operator Instructions] And we will take our first question from Stephen Grambling with Morgan Stanley. Stephen Grambling: Hey, thanks for taking the question. I guess on the guidance in the second half, it looks like you kind of lowered overall RevPAR by about 50 basis points, the reduction in EBITDA about 2%. I realize that a lot of that looks like it’s incentive management fee related, but is that the appropriate kind of operating leverage to consider going forward? And what levers do you have to pull if you were to see the backdrop deteriorate further and try to take additional action? Leeny Oberg: Sure. Thanks, Stephen. So a couple of things in that question. One is the reality that when we typically talk about 1 point of RevPAR being $50 million to $60 million in fees, that’s assuming that that’s equally across all markets around the world and doesn’t have any FX impact. And so I think you are clearly seeing with the drop that we talked today that the impact of the change in our outlook for Greater China has a disproportionate impact. When I think about Greater China’s mix between base fees and IMFs, it’s obviously quite different than it is in the US where you have an owner’s priority return. So for 1 point of RevPAR in Greater China, that is typically something more like $3 [million] (ph) in fees, which is going to be more heavily weighted towards IMFs than it would be in the US where it would have a dramatically smaller impact. So I think we really have to look at the geography rather than necessarily just thinking about it as being a half point overall because it is overwhelmingly related to Greater China with just a slight, truly a tad bit lower expectation in the US and Canada. Stephen Grambling: Got it. That’s helpful. Maybe one kind of unrelated, could be related follow-up is just there was always in these questions around fees per room and how the NUG plus RevPAR translates to overall fees. There’s a lot of puts and takes in the quarter, but has anything changed in your thought processes as we look at the longer term algorithm, as we think about that fees being related to net unit growth plus RevPAR? Leeny Oberg: Yeah, no, we think you’re absolutely right. We believe the algorithm absolutely holds up over time. You do have, as you described, the impact of certain elements changing unevenly. So in this particular situation, it is one market having a potentially large change in expected RevPAR for the rest of the year. But we’ve talked before about our expectation of fees per key as actually rising over time, especially as we think about also having our rapidly growing non-RevPAR fees. So we’re very pleased with those continuing trends and do not believe that the fundamental algorithm is any different. Stephen Grambling: Great, thank you. I’ll jump back in the queue. Operator: Thank you. And we will take our next question from Shaun Kelley with Bank of America. Shaun Kelley: Hi. Good morning, everyone. Leeny Oberg: Hey, Shaun. Shaun Kelley: Hi, Leeny. Just wanted to start with the RevPAR guidance. So if we kind of take the pieces here, obviously we know where we came in the first half of the year and you’ve given us color on Q3. I believe in the prepared remarks you said Q3 would be the weakest point for China, but when we kind of do the pieces, I think Q4, the implied guidance is below Q3. So what’s driving that sort of weaker Q4? Is it group timing? Is it some other shift?Leeny, you mentioned the election, but I think you also said US is pretty stable. So kind of what’s driving? Check the math, but if the math is right, what’s driving the weaker Q4? Is there anything in that Q4 run rate anybody needs to be concerned about or aware of? Leeny Oberg: Yeah, thank you, Shaun, and you’re right. We can point out that kind of an interesting distinction there between Q3 and Q4. With China only being roughly 10% of our rooms, that impact of the lowest quarter in the back half of the year being Q3 doesn’t have that much of an impact on Q4. What’s going on on Q4 is as we described that we are seeing a bit lower group bookings specifically in Q4 around the election, which is having an impact on the expectations for US and Canada in Q4 versus Q3, though as we described when we look at the entire back half of the year, we do expect to see really a similar sort of RevPAR growth number as you see in the first half of the year. And then on top of that, you’ve got your other international markets just continuing to normalize. So when I look at the first half of APEC and EMEA and CALA, I would expect that their back half is a little bit lower. And so in that regard, as you move towards Q4, you continue to see additional normalization, although still quite strong RevPAR in those markets. And you put all that together and that’s where you get the bit lower outlook for RevPAR in Q4 than Q3. Tony Capuano: And maybe just to add a little more context to that, Shaun, the — obviously we knew there was an election this year and baked what we’ve seen as historical softness. But when you look back over prior election cycles, we tended to see a little bit of group softness the week of election. Given for the unique attributes of this election cycle, we’re seeing that bleed into the week after the election as well. So it’s from a group perspective, about half of November is feeling the impact on the group side. Shaun Kelley: Great, thanks. And just as my follow-up just to kind of hit on China specifically, obviously I think you gave us a little bit of the heads-up that this was softening last quarter. The real question, though, I expect we’ll get some, is this bleeding it all into the development side, right? The signings and the development side was a highlight for the quarter broadly, but what do you think on the ground there, and is that softness at all starting to impact developer conversations or signing conversations in Greater China? Tony Capuano: It’s a great question and it’s sort of an interesting riddle. As you heard in my prepared remarks, we had record signings in the first half of the year in China. I think it’s really about the long-term prospects in China. Our owner community, certainly the SOEs there, continue to believe in the long-term dynamics of travel, and continue to both sign and start constructing them. So we really have seen no slowdown at all on that front. In fact, it’s interesting, we signed 63 select service deals in the first half of the year in China. Almost half of those are expected to open within 12 months. So as we look at the pace, we ask the same question as you. Are we stacking paper or are we signing deals that are going to materialize as openings? And the pace of construction is really encouraging. Leeny Oberg: And the only thing I’ll add is that I think with our continued strength in RevPAR index in Greater China, especially as you see demand softening over the past six months or so, we have seen increased owner appetite for being with the really strong brands that we have and across the full range of brands. So we’re really pleased to see kind of from the limited service segment all the way up through luxury, the really strong demand for the brands, including conversions in China, I think really demonstrating that it’s frankly in the weaker times that sometimes the brands can prove the most powerful. Shaun Kelley: Thank you so much. Operator: Thank you. And our next question comes from Smedes Rose with Citi. Smedes Rose: Hi, thank you. I wanted to ask you a little bit more on — you mentioned some weakness in Hawaii and I just was wondering, are you seeing it across all regions or is it maybe more isolated in Maui with what’s been going on there? And is it sort of leisure or is it sort of group consensus, meaning, what’s sort of driving relative weakness in that region? Leeny Oberg: Yeah, sure, Smedes, and yes, I think, I think Maui is definitely still seeing the slowest recovery. You still have the reality that the dollar is very strong, and Hawaii has been always been a very popular place for Japanese travelers. And so we overall in Hawaii, we’ve still not seen the level of Japanese travelers back in the state. But obviously, the tragedy in Lahaina has clearly had a huge impact on the island. And while we were there with Tony, with the senior team, a couple of weeks ago, and there’s been fabulous progress, and it is really coming along well. But clearly still that island in particular is having a slower recovery than the other parts of Hawaii. But Hawaii overall is still feeling the impact of the strong dollar. Smedes Rose: Okay. And then I just wanted to ask you, you mentioned that IMF fees were flat in North America. I think can you just remind us, what percentage of your system in North America is currently paying IMF? Leeny Oberg: Sure, absolutely. So interestingly, it’s the same percentage as a year ago in the second quarter. 26% of the hotels in the US are paying incentive fees in the second quarter. And just as a reference point, in China, in Greater China, we went from 86% to 80%. So you see that really large delta given the structure of the management agreements. Overall for managed contracts for Marriott, we went from 62% paying incentive fees last year in the second quarter to 61% this year. So you can see that in the US it’s fairly steady and more limited to certain pockets geographically that weren’t quite as strong. Smedes Rose: Great. Thank you. Appreciate it. Operator: Thank you. And our next question comes from Joe Greff with JPMorgan. Joe Greff: Good morning, everybody. Tony Capuano: Good morning. Leeny Oberg: Good morning, Joe. Joe Greff: Good morning. Your gross fee guidance for the full year is lowered by about $50 million to $100 million versus what you gave in May. I was hoping you could break that out between the net impact from China, the election impact in the US, and FX. Leeny Oberg: Yeah, so let’s do this. IMFs are definitely two-thirds of that. And I would say if you’re looking at that, a solid half, if not a bit more, is from greater China. Now that you’ve got to get into how much is the RevPAR versus how much is FX, and there is a bit of both. Then you’re also looking in IMF at some in the US, which let’s call it, broadly speaking, roughly $10 million, from various markets not performing as well as we expected a quarter ago. Then you’ve got also FX overall is affecting both some base fees and IMFs. So to separate it out, you get into — a bit into kind of which element are you describing. But I would say that China is the biggest impact on the change in IMFs, which is two-thirds of the overall $75 million in reduction. And then you’ve got a bit from the US and a bit from FX. Obviously, the lower RevPAR globally has a little bit of impact, and then ever so — truly ever so slightly is related to non-RevPAR fees. Joe Greff: Great. I think, Tony, your prepared remarks talk about construction starts in the US and Canada of 40% year-over-year. And we’re hearing that from others as well. Can you talk about construction starts outside the US, how that has been trending? Tony Capuano: Yeah, of course. So as I said, here in the US, up about 40%, which is really encouraging. In greater China, I might refer to the comment I made earlier. Again, in China, as you know, oftentimes projects that come to us are well under construction. So we tend to look more at what percentage of those deals might open within 12 months of signing and to see nearly half in greater China is really encouraging. In APEC, Asia Pacific excluding China, there is still some challenges getting projects financed, and there’s a continued wait for a little easing in the interest rate environment. And in EMEA, you’ve got a similar circumstance. Financing is continuing to be a bit of an impediment. But despite everything I just described between all of the regions that we talked about, construction starts on a global basis are up that same number about 40%. And the other thing I would tell you is the combination of some improvement in construction start activity and continued really strong performance on the conversion side, we’ve now had 27 straight quarters with about 200,000 rooms or more under construction. So even with really strong openings, we continue to see those starts fuel the under-construction pipeline. Joe Greff: Great. Thank you very much. Tony Capuano: You’re welcome. Operator: Thank you. And our next question comes from David Katz with Jefferies. David Katz: Hi, good morning, everyone. Thanks for taking my questions. What I wanted to do was just get a little further insight on the NUG guidance broadly speaking, which is the same. And the makeup of that NUG where we’re focused on, let’s say, the MGM deal, which is a sort of different kind of fee structure than what you have. And should we be looking at that NUG in that pipeline through a more updated lens where there are going to be more of those kinds of deals in there and just thinking about how we model fees in response to that NUG over time, if my question is clear enough? Tony Capuano: Yeah, it is. And I think the short answer is, I don’t think it should cause you to think materially differently about our NUG, about the value of our NUG, about our fee structures. MGM was an extraordinarily exciting and unique opportunity to bring two powerhouse sets of brands together and that caused us to be creative on the deal structure. But the vast majority, almost the entirety of the pipeline, fits squarely in our traditional approach to managed and franchise deals. Leeny Oberg: The only thing I would add, David, is that we are really pleased with the number of multi-unit deals that we’re signing. But overwhelmingly, they’re multi-unit franchise or managed deals that are typical, but they just represent an owner wanting to sign a number of properties up with Marriott rather than a onesie or a twosie. So in that regard, it’s great for our growth, and we’re really pleased with the continuation of those relationships, but they don’t represent a fundamental change in the nature of the agreement. David Katz: That’s really, really helpful. Can — while we’re on the subject, as my follow-up, could we just touch on the MGM deal and talk about how it’s going, any data points or anything like that would be helpful? Thanks. Tony Capuano: Yeah. The short answer is, it’s really going great. I talked to Bill not long ago, I think, from both companies’ perspectives, we are elated at the volume of both transient and group leads that are coming through our systems. The number of folks that are considering linking their MGM rewards and Marriott Bonvoy accounts, the number of groups that are unique groups that are now available to the MGM portfolio. So I think on all fronts, we are thrilled. David Katz: Excellent. Thank you. Appreciate it. Tony Capuano: Welcome. Leeny Oberg: Thank you. Operator: Thank you. And our next question comes from Brandt Montour with Barclays. Brandt Montour: Good morning everybody. Thanks for taking my question. Leeny Oberg: Good morning. Brandt Montour: Good morning, Leeny. So I want to talk about group pace for ’25. Have you guys seen that pace remain consistent? Has it strengthened or softened quarter-over-quarter? And have you seen any booking hesitation from large groups for ’25 in relation to the election and the uncertainty around the election? Tony Capuano: Yeah. So good questions. As I mentioned in my prepared remarks, the forward bookings for the balance of ’24 are consistent with last quarter with about 9% improvement. In 2025, as we look ahead, right now, 2025 is pacing at 9%, which is a little erosion from last quarter. But most of the change is due to pace in room nights. Some of that is around — or the length of time that folks are booking now, but group continues to be a standout. Brandt Montour: That’s great, Tony. Thanks for that. And then just a second question on owned and leased. It looks like the 2Q came in nicely ahead of plan and you raised the full year — maybe just highlight which region stood out there and then the second half outlook for owned and how that squares with your broader sort of shifting in thoughts for that portfolio? Thanks. Leeny Oberg: Sure. As you know, our owned lease portfolio is a bit disparate around the world, and so it can depend on certain markets. Obviously, in Europe and — business has been good. And so those results are strong. But it also contains termination fees in that category. And I think the reality is the outlook for termination fees is a bit higher than it was a quarter ago. It’s as you noted, a very modest change in the overall guidance. So we’re pleased with how well the hotels are doing in that portfolio. We’ve got a little bit of renovation impact that goes on. But otherwise, overall, really consistent view of the results in that segment with a little bit more termination fees. Brandt Montour: Great. Thanks everyone. Operator: Thank you. And we will take our next question from Dan Politzer with Wells Fargo. Dan Politzer: Hey, good morning, everyone. Thanks for taking my question. Tony Capuano: Good morning. Dan Politzer: In terms of the unit growth, certainly pacing well, and you’ve given a lot of color in terms of both China as well as ex-China. As we think about kind of the exit pace for this year and the setup for next year, to what degree do you have confidence in achieving that 5% to 5.5% CAGR that you laid out at your Analyst Day last year? Leeny Oberg: So first of all, it won’t surprise you. We’re not ready to talk about specifics for next year, but we certainly continue to believe that the 5% to 5.5% guidance that we gave in September of ’23 is appropriate. Whether it — we’ve got a specific budget that looks at a number that is higher or not. We will get there as we move through the process. The thing I’d like to point out is conversions and also the adaptive reuse numbers that Tony talked about relative to Greater China. Given that we are looking at a roughly 30% of our room openings coming from conversions and then the adaptive reuse numbers that we’ve talked about, I think we do continue to see a great rise of near-term openings over the next 18 months around the world. Tony pointed out the three luxury conversions that opened this year in the US, and those were in the year for the year conversions for the company. So those deals were signed this year and opened this year. So from that perspective, we do continue to feel really good about the demand for the brands. And then we talked a little bit about the uptick in construction starts, and I think you put that together and that bodes well for the company’s continued net rooms growth. Dan Politzer: Got it. Thank you. And then just, I think, Leeny, you mentioned that leisure is still growing, albeit slowly. Can you maybe unpack that a bit and talk a little bit about the underlying trends there, either by chain scale or booking window or any changes you’ve seen in that customer base? Leeny Oberg: Yeah, sure. You’re right. We saw leisure grow 2% and while that’s clearly nothing like group that was at 10%, it is still encouraging given they came out of COVID rapid fire and with huge increases in RevPAR. So very pleased. Global leisure nights were up 2%. ADR was up 1%, and even the US and Canada leisure RevPAR was up 1%. And when you look at the various segments, global luxury resorts were up 4.1% in terms of RevPAR and US luxury resorts were up almost 1%. So while I think there is at the margin a hair more caution from the US customer, we do see that there continues to be very strong demand on the leisure front. The other thing I’d point out is that we clearly are seeing a stronger performance in the upper chain scales than compared to the lower chain scale. And you’re seeing that throughout the industry as well. So when you look at premium and luxury, that overall is stronger than it is in the lower chain scales. Tony Capuano: And, Dan, just to provide a little more context. I mean Leeny referenced the strength we’ve seen in leisure. Remind yourself, leisure was the fastest customer segment to recover. And over the last five years, RevPAR and the leisure segment is up 40%. And so to continue to see quarter-over-quarter improvement in leisure RevPAR on the shoulders of that sort of recovery for us is quite encouraging. Dan Politzer: Got it. Leeny Oberg: And the last thing I’ll say is we do expect for the full year, while it will not be the — it will be relatively the slower growing segment compared to group and BT, we still do expect it to be up for the full year as well. Dan Politzer: Understood. Thank you so much. Operator: Thank you. And our next question comes from Bill Crow with Raymond James. Bill Crow: Hey, good morning. If I could just start with a follow-up on that last question. Are you seeing the sluggishness at the low end creeping into higher income levels at this point? Leeny Oberg: No, not really. I think one thing that’s just interesting is that ancillary spend around the world, US and Canada, and frankly, all of the other regions, ancillary spend was a hair softer than we anticipated. And I think it does show that the consumer in general is perhaps being a bit more judicious about the fancy dinner or going on that extra trip when they’re on a vacation. And that is really the only thing. It’s not trade down in any meaningful way. And as we pointed out, the resort RevPAR was sturdy. But that’s really the only item that I can point to. Tony Capuano: Yeah, I think, Bill, the empirical data that supports Leeny’s observation, when you looked in the corridor at occupancy improvement by quality tier, luxury was actually the tier that had the best improvement at almost 2.5 points of occupancy year-over-year. And so, again, that high-end consumer continues to show real resilience and real appetite for travel. I think the one thing we’re watching is what Leeny pointed out, and that’s the ancillary spend. Bill Crow: Yeah. Okay, thanks. If I could just follow up with a quick one about the balance of travel between inbound and outbound international. This was supposed to be the summer where it kind of equaled out and that’s not happening. Can you just update us your thoughts on how you see that recovery playing out, especially inbound in the United States? Leeny Oberg: Yeah. So, interestingly, inbound is about the same as it was prior to COVID. 4% to 5% of the nights in the US are from cross-border, and it’s the same as usual where big cities like New York and Miami continue to get outsized presence from cross-border travel. But they also continue to be from the markets like Canada and Mexico coming to the US. As we look at going to other markets, we are seeing that we’ve gone a hair higher than 19 levels. We’re — almost 20% of our business around the world is cross-border. Now, part of that, the reality is we’ve got more international rooms than we had in 2019. But you continue to see with the strong US dollar, you continue to see great travel from US travelers, for example, going to Japan, going to Europe, Middle Eastern travelers, traveling to many other countries. So I think the global nature of travel is only increasing, which from our perspective is fabulous. Bill Crow: Okay. Thank you. Operator: Thank you. And we will take our next question from Ari Klein with BMO Capital Markets. Ari Klein: Thank you. Good morning. Going back to China, historically that region has been a sizable outsource of travel demand globally. And based on the commentary, that piece still appears to be largely holding, Why do you think that’s the case and is that something you anticipate changing? Leeny Oberg: Could you repeat it? You broke up some on the question. Do you mind repeating it, please? Ari Klein: Sorry about that. Yeah, so just China has been a sizable outsourcer of travel demand globally, and based on the commentary that still appears to be holding. Why do you think that that’s the case? And is that something you expect to change given the broader weakness in China? Leeny Oberg: So I’ll give you a couple of facts and also a reminder that a year ago you were just starting to see Chinese travelers leaving the country. So one of the big differences in Q2 is there was meaningfully better airlift out of China to other parts of the world. Now while the US airlift is still not back to where it was, overall there are about 75% back to where they were in terms of airlift to other countries and particularly to other countries in Asia Pacific. So, no doubt our Asia Pacific hotels outside of Greater China benefited from the higher income travelers in China wanting to go outside of China now that frankly it was a freer opportunity to do so on the heels of the recovery from COVID. So we are seeing that. I will say that the travel to and from the US is definitely not back to the levels that it was. And we do continue to expect to see really strong outbound demand from greater China. But I will point you again to the overall macroeconomic picture there in greater China, which is frankly meant that overall levels of travel spend have not recovered as fast as perhaps might have been expected. Tony Capuano: The only thing I would add are the other catalyst we’ve seen is the Chinese government has been more and more aggressive in striking visa deals with preferred destinations, removing one more layer of friction for outbound Chinese travelers, especially at the high end. And we’re seeing that particularly in our results across APEC. Ari Klein: Thanks for that. And then just on the 40% increase in US construction starts, is there any notable difference between the starts on select service hotels versus full service hotels? Leeny Oberg: No. Overwhelmingly, our pipeline, as you might imagine, is overwhelmingly limited service in any event. And most of the full service deals that we’re doing are conversions. So this is quite similar to 2019, where there are overwhelmingly select service new builds. Ari Klein: Thank you. Operator: Thank you. And our next question comes from Robin Farley with UBS. Robin Farley: Great. Thank you. Just going back to the topic of unit growth, you talked about the increase in construction starts. But if you look at sort of overall under-construction as a percent of pipeline, it’s still, I want to say it’s at 37%, still quite a bit lower than historic. So I’m just wondering, you mentioned it’s not really — China’s not the issue there. Is it a lot of projects that are sitting that haven’t gotten the financing or is it actually churn and like projects falling out, new projects coming in, so that percent of under-construction isn’t necessarily ticking up. Just any color around that. Thanks. Tony Capuano: Yeah, it’s definitely not churn. I mean we continue to see kind of historic low levels of dropout from the pipeline. I think here in the US, while we’re encouraged by that pickup of 40%, you still — and it’s a bit ironic because when you talk to the lenders, often the hospitality component of their commercial real estate portfolios are the best subset of that portfolio. But the availability of construction debt is still relatively constricted to where we were in a pre-pandemic situation. And as a result, we’re not back to where we were pre-pandemic in terms of shovels in the ground. Trends are going the right direction, but we’re just not all the way back yet. Robin Farley: Okay. Thank you. And just as a follow up, looking at 2025, and I know you haven’t guided specifically, but you had that sort of two-year guidance that kind of implies for 2025, that conversions will kind of accelerate, I think, as a percent of new units next year. And I think conversions are already a greater contributor to your net unit growth than historic. Just looking at that 30% that you’re at, maybe you can refresh this. Maybe that’s, I’m not remembering that right. But if you’re already at sort of that higher than historic percent, help us think about what dynamics you’re expecting that will sort of drive incremental conversions of percent of total for 2025. And because there’s acceleration overall in your unit growth expectation, it’s not just acceleration in percent of total acceleration in absolute units as well. Thanks. Tony Capuano: Yeah. So again, as Leeny pointed out earlier, we’re not quite ready to put a stake in the ground on specific guidance for ‘25, but we continue to see conversion volume at 30-plus-percent of both signings and openings. It feels like our momentum in conversions is accelerating, and it’s really encouraging to see the way the owner and franchise community is gravitating towards the strength of our revenue engines. Robin Farley: Thank you. Tony Capuano: You’re welcome. Operator: Thank you. And our next question comes from Patrick Scholes with Truist Securities. Patrick Scholes: Great. Good morning, everyone. My first question, how would you describe your visibility as far as bookings in China as opposed to the US? Even more granular, what would you say the typical booking window looks like for China versus over here? Thank you. Tony Capuano: Yeah. So, I think our visibility is pretty good but the booking window is historically short right now. And so that’s making it challenging for us to look much beyond the end of this year. Right now you are seeing very, very short-term booking window, kind of one to three days versus what we see around most of the rest of the world is closer to 20 days. Patrick Scholes: Okay. Thank you. And then a different topic here. I’m wondering if you could give us an update on your recent trends for spending key money to make development happen. Thank you. Tony Capuano: Of course. It’s a trend that we analyze quite a bit ourselves. And so I’m going to give you a couple statistics. We’re only halfway through ‘24. So I’m going to compare 2019 to 2023 full year. It’s interesting, the percentage of deals in full year 2023 that required key money is actually a bit lower than what we saw in 2019. And similarly, the amount of key money offered in deals that had key money in 2023 was almost 10% lower than what we saw in 2019. Now to be sure, there’s a couple other trends below the surface of those encouraging statistics. To be sure that the environment is becoming more and more competitive and we continue to apply the same lens we’ve always applied, which is in deals that are strategic and have a significant fee upside, that’s when we consider leveraging the company’s balance sheet. And number two, back in 2019, I don’t know the precise statistic, but the bulk of the key money we deployed would have been in the upper upscale and luxury. And I think now you are seeing selectively the opportunity or the need to deploy key money or other capital tools lower in the quality tier framework. Patrick Scholes: Okay, thank you for the color. Tony Capuano: Sure. Operator: Thank you. And we will take our final question from Michael Bellisario with Baird. Michael Bellisario: Thanks. Good morning, everyone. Tony Capuano: Good Morning. Michael Bellisario: First question, just to follow up on the ancillary spend. Is the lower non-RevPAR fee outlook, is that being driven by lower card spending? And then are you also seeing that softer ancillary spend within the group segment, or is that comment just specific to leisure transient? Leeny Oberg: Yeah, no. So good questions. I would say the lower ancillary spend is across the board. So a little bit, only a little bit, but a little bit everywhere, both leisure as well as group. And then on the non-RevPAR spend, overall we are still seeing credit card spend go up very nicely. We’re still looking at credit card fees being up 10% in 2024. It is the average spent that has moderated a little bit in terms of a typical card holder in the US, but again, only a very, very small amount. And just as a reminder, the ancillary spend is related to credit card spend because obviously people use their credit cards to buy these things, but our ancillary revenues are going to come through the RevPAR line because those are earned at hotels. The non-RevPAR fees are entirely a function of what’s going on, obviously, in residential and timeshare and in the credit cards. And that’s where, to your point, we’re seeing average spend moderate a bit. But again, overall, credit card spend will go out very nicely because we’re really pleased with the adding of new card holders to our portfolio. Michael Bellisario: Got it. Understood. And then just one follow up just on your lower end chain scales. You’ve noted a lot of discussions and signings, but where are you at with shovels in the ground, say, for StudioRes, and then are you still focused on the multi-unit development deals, and then when do you switch to single asset deals? Thank you. Leeny Oberg: Yeah. So as we spoke about before, we are really pleased with the large number of multi-unit conversion deals that we’ve had under discussion and in some cases closed around the world. So that is great. And then we’ve talked about specifically in the mid-scale as having over 300 hotels under discussion with multi-unit developers. And we are seeing more of them actually put the shovels in the ground. Jackie McConagha: Operator? Operator: Thank you. We have used up our allotted time for questions. I will now turn the call over to Tony for closing remarks. Tony Capuano: Great. Well, as always, thank you again for your interest in Marriott. I hope you enjoy the balance of the summer. Hope you’re out on the road, and we’ll look forward to speaking to you next quarter. Thanks. Operator: This does conclude today’s Marriott International Q2 2024 earnings. Thank you for your participation. You may disconnect at any time. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C. !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window, document,'script','https://connect.facebook.net/en_US/fbevents.js'); Source link The post Marriott International narrows full-year outlook amid growth By Investing.com first appeared on Forex Trader Hub.

Let’s immediately address the question most commonly asked by prospective Indian traders: “Is Forex trading legal in India?” Yes, it is, but under strict conditions. India’s laws restrict its residents to a specified list of currency pairs, trading instruments, allowable brokers and exchanges. This is unlike regulations in other regions such as the EU, UK, USA, Canada, and Australia, where traders can freely speculate on dozens of Forex pairs on decentralized over-the-counter (OTC) markets. This article explores the legal framework so Indian residents can better understand their options. Forex trading is legal in India, and Indian residents can engage in currency trading, but they must adhere to the specific terms and regulations set by the authorities. The regulations impact three main areas: The currency pairs available to trade. The legally available brokers to Indian traders. Trading should be for non-speculative reasons. Let’s explore each area. At the time of writing, there are seven currency pairs that Indian traders can access: US Dollar vs. Indian Rupee (USD/INR) Euro vs. Indian Rupee (EUR/INR) British Pound vs. Indian Rupee (GBP/INR) Japanese Yen vs. Indian Rupee (JPY/INR) Euro vs. US Dollar (EUR/USD) British Pound vs. US Dollar (GBP/USD) US Dollar vs. Japanese Yen (USD/JPY) So, what are the legal forex trading platforms in India? The best Indian forex brokers are fully licensed, and to trade forex legally in India, individuals must use a forex broker regulated by the Securities and Exchange Board of India (SEBI). To be SEBI-registered, brokers must meet specific compliance standards, including depositing client money in separate accounts from the firm’s operations and maintaining a physical presence in India. Indians cannot use overseas brokers or trading platforms that are not regulated in India to trade currencies. SEBI-registered brokers will only execute currency trades through recognized Indian exchanges. The allowable exchanges are the National Stock Exchange (NSE) and its subsidiary, NSE IFSC, the Bombay Stock Exchange (BSE), and the Multi Commodity Stock Exchange (MCX-SX). This type of execution is unusual compared to many other countries, where brokers will often access currency pairs through decentralized OTC markets that do not have centralized exchanges. How Do I Know If My Broker Is SEBI-Regulated?  SEBI-regulated brokers will display their SEBI regulation numbers, NSE, BSE and MCX member IDs, and registered addresses on their websites. Speculative trading means profiting from changes in a currency pair’s values. The alternative to speculative trading is hedging risk for an underlying holding. For example, if a business is exporting goods to the UK, it might open a GBP/INR trade to lock in the exchange rate for the export value. Even though Indian regulations state that currency trading cannot be for speculative purposes, SEBI-registered brokers have provided services for speculative trading for some years. According to Bloomberg, “a rule that allowed transactions of up to $100 million without providing proof of an actual foreign-currency exposure had been interpreted by them as tacit acceptance of speculative trade by the authorities.” However, as recently as March 2024, the Reserve Bank of India has re-iterated the rule demanding that brokers only allow non-speculative trading. Indian traders responded through a broker’s association to push for a reconsideration of RBI’s non-speculative rule. SEBI, or the Securities and Exchange Board of India, is the country’s main securities regulator. Its core function is “to protect the interests of investors in securities and to promote the development of and to regulate the securities market.” SEBI requires brokers that provide currency trading services to be registered. Foreign exchange trading is regulated by three entities: RBI, SEBI, and the Foreign Exchange Management Act (FEMA) 1999: RBI manages currency reserves. SEBI regulates the brokers. FEMA sets the overall guidelines for currency transactions. Specialize in a trading strategy: There are many ways to trade currencies, e.g., trading news announcements, chart patterns, and short-term vs. long-term trading. Don’t trade too many different strategies because it is harder to develop competence across multiple areas. Choose one strategy and learn it exceptionally well. For example, I specialized in technical patterns on the GBP/USD on 15-minute charts. That level of focus gave me discipline, structure, and expertise. Practice and start with a demo account, or start small: Do not rush in. The market loves nothing more than to take money from unprepared traders. The Indian Forex market is properly regulated, and registered brokers must hold client capital separately from their operations. This requirement, known as “segregating client capital,” is the safest way for brokers to operate. Leverage is available on currency trading in India. Currency trading can provide substantial income independent of economic conditions. The regulators may become stricter about preventing speculative trading. There’s no access to many internationally available currency pairs or different types of trading instruments. Forex trading in India is legal but under strict conditions. Indian residents can legally access seven currency pairs: USD/INR, EUR/INR, GBP/INR, JPY/INR, EUR/USD, GBP/USD and USD/JPY. Brokers must be SEBI-registered to offer services to Indian traders and execute all currency trades through a recognized Indian exchange. Source link The post Is Forex Trading Legal in India in [year]? first appeared on Forex Trader Hub.