This is The Takeaway from today’s Morning Brief, that’s possible sign up to receive in your inbox every morning, along with:
The revenue avalanche has begun.
And what does that mean?
You probably missed a lot other stories that could impact your portfolio. After all, there’s more to investing your life than modeling 2050 profits for Nvidia (NVDA) and wondering whether Tesla (TSLA) will rake in $10 billion in sales from humanoid robots.
In the spirit of that, here are a few conversations I’ve had this week that might get you thinking (hopefully).
AI meets extra spicy hot sauce: I was at a CEO dinner this week where an analyst specializing in AI talked about the profound impact on businesses as AI proliferates. I tend to agree that the way business is done will change profoundly, and that this will mean significant job losses.
An example of the impact of AI is Cholula’s hot sauce. Parent company, spice maker McCormick (MKC), held an investor day this week.
“We used generative AI to really understand where all the commentary was going [for hot sauce]we found out that there were some Cholula lovers who wanted a hotter version. That’s why we’re launching an even more popular version of Cholula in January,” Brendan Foley, CEO of McCormick, told Yahoo Finance’s Market Domination Overtime.
McCormick reiterated his expectations for long-term revenue growth of 4% to 6% and earnings growth of 9% to 11%. Shares are up 16% year to date compared to the S&P 500’s 22% gain.
Building a 21st Century Media Company: The traditional media industry continues to be disrupted by everything from new streaming networks to creators posting to YouTube. Why else do you think Disney (DIS) said this week that CEO Bob Iger would stay until 2026 (he was rumored to leave in 2025)? He needs to leave the company in a much better place than his last departure.
One of these disrupters of the past fifteen years was Dude Perfect. The company was founded by five friends who attended Texas A&M and rose to fame thanks to viral trick-shot videos posted to YouTube. The company now has 60.5 million subscribers and produces a stable, wider range of content.
Armed with a new $100 million capital infusion from Highmount Capital, Dude Perfect is gearing up for more unique programming and the buildout of a headquarters in Frisco, Texas. Responsible for bringing that vision to life? Dude Perfect’s very first CEO Andrew Yaffe, who took on the job a few weeks ago.
“I think people underestimate how big YouTube is,” Yaffe told me about Google’s (GOOG) platform on Yahoo Finance’s Opening Bid podcast (video above; listen here). “YouTube is the largest media platform in the US in terms of consumption. Bigger than Netflix (NFLX). And that is growing quickly. It is also the largest outside the US. It’s huge – it’s the way people under 34 consume content. “
Not huge: Google’s stock price year to date. Shares lagged the S&P 500’s 23% gain and rose just 16%.
Big Blue is a major AI player: So much is lost on a company’s earnings day when traders zero in on the numbers and some trends on the earnings call. Ultimately, this is why I think companies should report twice a year, but that’s a discussion for another day.
One number that got lost in IBM’s earnings on Wednesday (leading to a sharp drop in its stock price as sales consultancies missed estimates): $3 billion in AI-related project support. IBM’s veteran CFO Jim Kavanaugh tells me the company is on track to add a billion dollars in AI project backlog every quarter.
That’s huge and consistent with what Kavanaugh thinks is a long road ahead for building out AI infrastructure.
“In my personal opinion, I think this will be the longest [adoption] curve that we will also see because it will play out in many different industries and with many different customers,” Kavanaugh said.
That bullish sentiment was echoed in a conversation I had at Opening Bid this week with BofA analyst Vivek Arya, where he discussed how the buildout of AI will require the use of nuclear power. More insight on that and how this will benefit market darling Nvidia can be found here.
Our Morning Brief host Seana Smith will join Chairman and CEO Arvind Krishna to dive into IBM’s AI future at our annual Invest conference on November 12. Would you like to stop by and say hello and be in the room for some wealth building conversations? Register here!
There is still a Marriott with Marriott: Meet David S. Marriott, 50, who took over as chairman at Marriott (MAR) in 2022 from his legendary father JW “Bill” Marriott, Jr., 92. David’s father – chairman emeritus – was chairman emeritus for 60 years chairman and CEO for 40 years. Astonishing! Bill’s parents, Alice Marriott and J. Willard Marriott, founded the company in 1927 as an A&W root beer stand.
Suffice it to say, the younger Marriott hardly does interviews (he travels a lot and has four children) – so it was a pleasure to spend time with him at Opening Bid.
“I interned in the kitchen for a number of summers, where I learned how to prepare food, hot food and cold food, and how to cook on the line. And I spent a summer as a doorman and for a while the beds made up and worked behind the kitchen, the front desk,” Marriott told me about his on-the-job training.
Our chat’s full pod drop is Monday at 8:30 AM ET. Make sure you tune in to Yahoo Finance or listen to the podcast platform of your choice.
And since you were wondering, Marriott stock is up 111% over the past five years. Hilton (HLT) is up 155%.
David S. Marriott (left) prefers to be called David. His father is known within the company as Mr. Marriott. ·Yahoo Finance
Three times a week I have insightful conversations with the biggest names in business and markets Opening bid. Find more episodes on our videohub. Check your favorite streaming service. Or listen and subscribe Apple podcasts, Spotifyor wherever you find your favorite podcasts.
Brian Sozzi is editor-in-chief of Yahoo Finance. Follow Sozzi on X @BrianSozzi and on LinkedIn. Tips about deals, mergers, activist situations or something else? Email brian.sozzi@yahoofinance.com.
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