BI Weekend: Oracle, Cracker Barrel Earnings, FDA Probe - Bloomberg Intelligence

Bloomberg Intelligence – BI Weekend: Oracle, Cracker Barrel Earnings, FDA Probe (December 12, 2025)

Episode Overview

Hosts Scarlet Fu and Paul Sweeney guide listeners through the major financial headlines of the week, leveraging the research power of Bloomberg Intelligence analysts. The episode focuses on:

Results of a major survey on AI’s impact across industries
The FDA’s investigation into Covid-19 vaccine safety and its implications for pharmaceutical companies
Oracle’s disappointing cloud earnings and the knock-on effects for AI investment
Leadership succession and strategic shifts at Berkshire Hathaway
Cracker Barrel’s sales challenges in the wake of a branding controversy
Campbell’s holiday-boosted earnings and the pressure of private-label competition
The changing landscape of U.S. biofuels under new policy

Key Discussion Points & Insights

1. AI’s Cross-Industry Disruption Survey

[Segment starts ~07:00]
Guest: Matthew Bloxham, Bloomberg Intelligence Tech Analyst

Survey Scope:
– 604 C-suite executives across diverse industries
– Assessed corporate AI investment motivations, expected impacts on headcount, and profit/revenue outlook
Findings:
– AI is a strategic priority for 36% (top) and another 47% (top-three priority)
– Main AI objectives:
Operational efficiency (47% of respondents)
Revenue growth (21%)
Headcount cuts are a low priority (only 13% see it as top priority)
– “Companies are looking to boost productivity, but they're not afraid to make investments both in technology and headcount in the near term.” – Matthew Bloxham [10:00]
– 62% expect AI to increase headcount by an average of 4% over three years
ROI & Roadblocks:
– ROI for AI investments remains unclear, with “investment needed in AI and the question marks around the return on investment definitely up there amongst some of the most important concerns,” Bloxham noted [12:50]
– Companies are mostly in early trial/pilot phases for AI
Quote:
“That kind of flies in the face a little bit of a lot of the kind of headlines we see about job cuts. I think overall corporates see the need to invest more in staff to roll out that AI strategies in the coming years.” – Matthew Bloxham [11:30]

2. FDA Probe into Covid-19 Vaccine Safety

[Segment starts ~17:30]
Guest: Sam Fazeli, Bloomberg Intelligence Director of Research, Global Industries & Senior Pharmaceuticals Analyst

FDA Investigation:
– The FDA is reviewing reports of deaths in adults potentially connected to Covid-19 vaccines
– Data so far comes from the Vaccine Adverse Event Reporting System (VAERS), which is voluntary and subject to reporting flaws
– “We don't know anything. Right. Last week we heard that they've got data that shows that there were 10 children's deaths. Where's the data? Show us. … Show us, where's the transparency?” – Sam Fazeli [18:15]
– Fazeli calls for rigorous transparency and data scrutiny
Sector Impacts:
– Possible outcomes:
- No link found, and the investigation closes
- Black box warning added to vaccines, possibly increasing public hesitancy
- (Highly unlikely) Removal of Covid vaccines from market
Company Vulnerability:
– Moderna and BioNTech most exposed among major producers; Moderna has a smaller cash cushion
– “I'm actually surprised in hindsight that maybe this management team kept their jobs there. I mean, this was a real self inflicted wound there.” – Sam Fazeli [21:00]
Industry Environment with New FDA Leadership:
– Uncertainty and “headbutting” with new Health and Human Services Secretary Robert F. Kennedy Jr., but sector still thriving with strong fundraising
Key to Success in 2026:
– “It's always been the same: clinical data. Get me a drug that's showing me clean data. … Present the data, take it to medical conferences.” – Sam Fazeli [23:45]

3. Oracle’s Disappointing Earnings & AI Cloud Backlog

[Segment starts ~27:00]
Guest: Anurag Rana, Bloomberg Intelligence Technology Analyst

Earnings Recap:
– Oracle’s cloud infrastructure growth was 66% (vs. 69% consensus); even a 1% miss is significant for Wall Street
– Growth bottlenecked by capacity constraints (data center, networking, power)
AI & Backlog Issues:
– Oracle has $500B in backlog, with over $300B tied to contracts with OpenAI
– OpenAI’s revenue run-rate is ~$20B, leading to skepticism over scale of commitments:
“So everybody is saying that, okay, well tell me if you have revenue of 20 billion, how, how are you going to spend 300 billion just with Oracle?” – Anurag Rana [29:40]
Strategic Needs & Next Steps:
– To turn backlog into revenue, Oracle needs new data centers – may require a special purpose vehicle with private capital to keep debt off balance sheet
OpenAI Revenue Streams:
– Consumer apps with paid subscriptions; enterprise API usage

4. Berkshire Hathaway’s Leadership Changes

[Segment starts ~35:30]
Guest: Matthew Palazzola, Bloomberg Intelligence Senior P&C Insurance Analyst

Key Moves:
– Retirement of CFO Mark Hamburg
– Investment deputy & GEICO CEO Todd Combs moves to JPMorgan (advising Jamie Dimon, et al.)
Significance:
– Some view Combs’s exit as an “unwelcome shake up” ahead of Warren Buffett’s retirement
General Counsel Role:
– New in-house legal position, centralizing legal strategy across the conglomerate
Street Sentiment:
– Concerns about the loss of Buffett and Ajit Jain (insurance division head), who has been selling stock and is key to Berkshire’s insurance prowess
– Hopeful that Abel, Buffett’s successor, brings a fresh, possibly more aggressive take on capital allocation
– “Maybe his strength is he's not Buffett, while his weaknesses he's not Buffett also… perhaps he takes a different look at capital allocation.” – Matthew Palazzola [38:50]

5. Cracker Barrel’s Guidance Cut After Brand Crisis

[Segment starts ~41:00]
Guest: Michael Halen, Bloomberg Intelligence Senior Restaurant and Food Service Analyst

Earnings Recap:
– Fiscal Q1 guidance for sales and EBITDA was cut due to traffic declines post-logo-change controversy
– Traffic now steady at -10/-11%; outlook is mixed—’no improvement’ scenario considered conservative
– Key focus: regaining customer trust, menu innovation, operational improvements
Remodel & CapEx Changes:
– Larger-scale remodeling (along with controversial logo) is being scaled back; focus now on smaller refreshes
– “The capex change is probably…the lowered capex is probably smart. They're going to continue to refresh their stores…improve floors where they need to…things of that nature that nobody's going to get up in arms over.” – Michael Halen [43:40]
CEO Job Security:
– Proxy fight to remove CEO Julie Masino failed—her earlier track record “showing some pretty good progress up until August”

6. Campbell’s Holiday Beat & CPG Industry Outlook

[Segment starts ~47:30]
Guest: Diana Rosero Pena, Bloomberg Intelligence Consumer Staples Analyst

Earnings Highlights:
– Campbell’s Q1 earnings beat thanks to retailer holiday inventory build
– Meals & Beverages: challenges for ready-to-serve soups and V8; broths/condensed soups rebounding
– Snacks: “Salty snacks challenged by health trends, but cookies outperforming—so, salad with fries moment.” – Diana Rosero Pena [49:40]
Strategic Moves:
– Campbell’s acquiring 49% of La Regina (supplier for Rao’s sauces) to offset tariffs and assure supply chain reliability
Brand Image Concern:
– Recent controversy after an executive’s disparaging comments; company quickly distanced itself, unlikely to be a major headwind
2026 Outlook & Private Label Threat:
– Volume growth could improve second-half 2026, but profitability is challenged by tariffs, costs, and need for marketing
– Private label competition continues; companies must win on shelf location and branding

7. U.S. Biofuels Policy Shake-up

[Segment starts ~56:50]
Guest: Anna Davies, Bloomberg BNEF Head of Renewable Fuels

Domestic Boom and Import Bust:
– U.S. imported 800M gallons of biodiesel last year, now on track to import just 10% of that
– “Policy, policy, policy” – new domestic-only U.S. tax credits and aggressive EPA blending mandates fueling the shift
Production Trends:
– Rapid expansion of U.S. capacity (repurposing old oil refineries for biofuels production)
– New Clean Fuel Producers credit (45Z) only benefits domestically made fuel, not imports
Global Context:
– U.S. incentives now less favorable than in the past; EU/UK and Singapore moving forward on mandates for sustainable aviation fuels
– China rapidly building capacity; global market flows changing

Notable Quotes & Memorable Moments

“AI is very much at the top of the C-suite agenda. Something like 36% of those polled said it was their top strategic priority and another 47% said it was within the top three…”
— Matthew Bloxham [09:15]
“We don't know anything. … Show us, where's the transparency?”
— Sam Fazeli on the FDA’s vaccine probe [18:15]
“So everybody is saying that, okay, well tell me if you have revenue of 20 billion, how, how are you going to spend 300 billion just with Oracle?”
— Anurag Rana [29:40]
“Maybe his strength is he's not Buffett, while his weakness is he's not Buffett also, but his strength is he doesn't have to do things the same way.”
— Matthew Palazzola [38:50]
“The capex change is probably…the lowered capex is probably smart…improve floors where they need to…things of that nature that nobody's going to get up in arms over.”
— Michael Halen [43:40]
“Policy, policy, policy. The main reason biofuels get off the ground anywhere is due to policy, because otherwise they wouldn't. The economics on their own don't work.”
— Anna Davies [57:50]

Segment Timestamps

AI Disruption Survey – 07:00–15:00
FDA Covid-19 Vaccine Probe – 17:30–25:00
Oracle Earnings and the AI Cloud Backlog – 27:00–33:00
Berkshire Hathaway’s Succession & Strategy – 35:30–40:30
Cracker Barrel’s Branding Crisis & Outlook – 41:00–45:00
Campbell’s Earnings & 2026 Packaged Food Outlook – 47:30–55:00
U.S. Biofuels: Policy and Market Shift – 56:50–End

Tone & Language

The discussion maintains a brisk, data-driven, and sometimes lightly humorous tone (“salad with fries moment” [49:40]), characteristic of Bloomberg’s financial journalism. Analyst guests provide candid, sometimes blunt, assessments—particularly around policy transparency and strategic missteps.

Summary Takeaway

This episode delivers a detailed look into how major players and sectors are evolving amid rapid technological advances, regulatory resets, and business-model inflection points. Listeners gain an informed pulse check on AI, market-leading corporates, CPGs, biotech, and the intersection of policy and growth across critical industries.

Transcript

A (0:00)

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That's unlimited data for unlimited business. There we go. Get the Internet you need at the price you want. Verizon Business Starting price for lte Business Internet 25 Mbps Unlimited Data Plan with select Verizon Business Smartphone plan Savings terms apply. Bloomberg Audio Studios Podcasts Radio News this is Bloomberg Intelligence with Scarlet Fu and Paul Sweeney. How do you think the Fed is looking at tariffs? The uncertainty of tariffs. Let's take a look at the sectors and how they performed. A lot of investors getting whipsawed every day by news events, breaking market headlines and corporate news from across the globe. Could we see a market disruption? A market event? People just too exuberant out there. You see some so called low quality stocks driving this short term rally. Bloomberg Intelligence with Scarlet who and Paul Sweeney on Bloomberg Radio, YouTube and Bloomberg Originals. On today's Bloomberg Intelligence show, we dig inside the big business stories impacting Wall street and the global markets. Each and every week, we provide in depth research and data on some of the 2000 companies in 130 industries our analysts cover worldwide. Today we'll look at why the computer tech company Oracle reported disappointing cloud sales last quarter. Plus, we'll look at how the one trillion dollar conglomerate Berkshire Hathaway is preparing for the retirement of CEO Warren Buffett. But first, we begin with a survey from Bloomberg Intelligence entitled AI's Cross Industry Disruption. It dives into how various industries are approaching AI implementation. It's also the largest study of C suite executives that BI has conducted. For more on this, guest host Christine Aquino and I were joined by Matthew Bloxham, Bloomberg Intelligence Tech Analyst. We first asked Matt to break down this BI survey. So this was a big survey. We did polling the views of 604C Suite executives across a range of industries across the really kind of get trying to get a sense on how corporates are assessing the current AI situation and what they think it's going to do to their businesses over the next kind of two to three years. So we kind of looked at the motivations for AI investment, what it could do to headcount, what they're expecting in terms of revenue and profit uptick. And we had some kind of interesting results out the survey. Not surprisingly, perhaps, AI is very much at the top of the C suite agenda. Something like 36% of those polled said it was their top strategic priority and another 47% said it was within the top three strategic objectives for them. When we looked and asked about the main objectives behind their AI strategies, what came out top was improving operational efficiency, which was number one with 47% of the respondents. And in second place was boosting revenue at 21%. Interestingly, headcount cuts were quite low down the pecking order. Only 13% of respondents put that as their top priority. And actually it was the highest ranked in terms of the least priority. So I think it's interesting that companies are looking to boost productivity, but they're not afraid to make investments both in technology and headcount in the near term to kind of release those opportunities. And actually on a three year view, 62% of respondents said they expect AI to lead to an increase in headcount over the next three years. An increase, not a decrease. And the average increase they're looking at is about 4, 4%. So that kind of Flies in the face a little bit of a lot of the kind of headlines we see about job cuts. I think overall corporates see the need to invest more in staff to roll out that AI strategies in the coming years. Yeah, yeah. Well, Matt, you mentioned 36% of C suites now rank as their top priority. That number actually strikes me as a little low. I would have thought it would be at least half of of the people survey, but what do you think? Is that something that's just set to grow in future surveys as really kind of. I become central to a lot of companies workflows these days? Yeah, I think so. I mean, you know, obviously if you, if you add the 47%. That said it's in the top three, I mean, you know, an overall top three priority gives you the kind of vast majority of the respondents. Obviously, you know, companies do have to wrestle with lots of other issues too, you know, that there is going on in the world beyond AI. You know, obviously trade policy is another big thing that's probably on the radar for a lot of these companies too. So, yeah, you know, maybe it will kind of inch up, but I think given that aggregate, you know, 80% plus in the top three, probably what you'd expect to see. Matthew, how about return on investment here? That's kind of what the Street's starting to ask for now. We know these companies can spend big money on AI, but what's the return for shareholders? Yeah, I think that's still very opaque and actually when we asked the respondents to flag the biggest roadblocks they could see to AI deployment, the investment needed in AI and the question marks around the return on investment were definitely up there amongst some of the most important concerns that respondents have alongside data security and clean data. We didn't ask much specific ROI expectations. We just kind of get the sense that it's a bit too early to get an accurate read on that. I think most companies are still kind of at a relatively early stage of their AI trials. Lots of them have moved out of the kind of testing LLMs, they're into pilot phases. Some of them are even moving into scale deployment. I think it's fair to say a lot of them are not, not really quite sure yet what the return is going to be and how quick it's going to come. And obviously it's kind of a bigger issue for the wider tech sector. And you mentioned Oracle as a kind of a barometer for the kind of broader pulse on, on AI. And I think 2026 is going to be a really crucial year for kind of what corporates make of the mid term roi. And if they don't see a big roi, then that's probably going to slow the pace of revenue growth and that's going to have a knock on effect to the levels of investment we're seeing made by the likes of Oracle and OpenAI and the revenues they're bringing in. Our thanks to Matthew Blockson, Bloomberg Intelligence Tech Analyst. We move next to some news in the biotech space. This week we heard that the Food and Drug Administration is investigating whether COVID 19 vaccines cause deaths in adults. It's part of a safety review that earlier appeared to just be focused on children. And the investigation comes at a time when U.S. health and Human Services Secretary Robert F. Kennedy Jr. And is upending long standing guidance for a wide range of vaccines. For more on this guest host Christina Kino and I, we're joined by Sam Fazeli, Bloomberg Intelligence Director of research for Global Industries and a senior pharmaceuticals analyst. We first asked Sam to break down what we know about the FDA's investigation. We don't know anything. Right. Last week we heard that they've got data that shows that there were 10 children's deaths. Where's the data? Show us. Right. They go and use this thing called vers, the Vaccine Adverse Events Reporting system, which is totally voluntary. I can go on there and say I had chicken nuggets just around the time as my Covid shot and I had an allergic reaction and they go, oh, okay, so I could put that on there. Right. In order to do an analysis of that database, which we as analysts try and do, which is very complicated because you need all the case background. Who was that patient? What happened to them? You need to do this work. Fine. I believe that they've done the work. Show us where's the transparency? They're here. I'm pretty sure. I don't know for a fact that they're using the same system. Do you see people? I mean, of course, that's a ridiculous question to ask. Falling over and dying in the streets after getting Covid shots all the time. There are issues that happen. A lot of people who take Covid shots these days are the elderly, which by definition have a higher probability of complications, etc. In general. So we need to keep an eye on this. I want to see the data and I want it properly scrutinized. Let us do that. Yes. Well, I mean, obviously, I guess this seems like it's in the early stage of investigation, but I mean, walk us through kind of the potential impact of this, right. Potentially it could affect public health policy and then potentially that will have some big on how companies move forward, especially the vaccine providers, presumably. Yeah, I mean, so two or three things can happen. The FDA can say, well, actually we didn't find the link because this just says that they're looking at it. Number two, they say, we found the link. We're going to put a black box warning into Covid vaccines. Why? That reduces people, that increases people's hesitancy potentially. Or they can go and say we want to take it off the market. I don't think they'll do that. But let's say, let's get there. There are two companies that are most exposed to this. Pfizer, of course, is one of the companies that sell the vaccine. But I mean, you know, Pfizer has a lot more going on. Right. The ones that are much more leveraged to the vaccines are Moderna and Biontech. What I find interesting is that Moderna, who is much more leveraged with. Because they're selling it themselves, they have a less of a cash cushion than Biontech has. Let's say they end the year this year with $7 billion in the bank. BioNTech said $18 billion in the bank. And yet it's the Biontech share price that gets hit most. And I don't understand why Moderna is more exposed because that cash cushion is lower. So if your revenue drops, then you're going to have an issue. Of course, they've been very good at cost management. So that's where I think this could end up. If it goes really the wire and they go, right, we're not going to suggest this anymore, which would be, I think, a tragedy for the U.S. so, Sam, we've been 10 months into this administration. We've got a U.S. health and Human Services Secretary, Robert F. Kennedy. We've been X number of months into his leadership. How is, how are pharma companies and biotech companies trying to work with this new administration? Because there's a lot of. One could argue there's a lot of headbutting there potentially. It doesn't look like people are that worried about it, but I promise you, if I went on our anonymous drug chat with clients, about 2,000 people on it, and I asked, how worried are you? I tell you, no one's going to say zero. There's always this background of worry. Right. The thing is, the sector is doing well. Only this week, so far, we've had close to $2 billion of money raised from companies with good data that's driven the share prices up. This is between five and six companies. So the sector's thriving. We need to make sure the FDA is in a place that will have very clear guidelines so that people know what they're dealing with and not get advice today that in six months time they go, well whatever we said then we don't. We have a different view now. Right. So that is a problem and there is something to worry about there. Let's hope that 2026 becomes a lot more stable for the FDA with logical scientific based decisions. Yeah. Well Sam, you know speaking of the sector is doing well overall but what do you think is going to be the key differentiator amongst the companies between the successes and I guess the less successful in 2026 it's always been the same clinical data. Get me a drug that's showing me clean data. Don't give me press releases with some cut of the data and the next press release is a different cut of the data. Publish the data, take it to medical conferences. The reason these companies are up most of them and have been able to raise money is that they've been very transparent with their data. They present it, you can analyze it some more transparent are there. Some of them are presenting at medical conferences like the ones we just had. Ash the American Society for Hematology. That is what drives this sector. Give me good clinical data. Of course M and A is great because they come and you get a price and you decide the share price goes there. But it's clinical data that is that data that gets them to being taken out. Our thanks to San Frazelli, Bloomberg Intelligence Director of Research for Global Industries and senior Pharmaceuticals Analyst. Coming up we'll look at why the restaurant and gift shop chain Cracker Barrel cut its sales outlook for the year. You're listening to Bloomberg Intelligence on Bloomberg Radio providing in depth research and data on 2000 companies and 130 industries. You can access Bloomberg Intelligence via bigo on the terminal. I'm Paul Sweeney and this is Bloomberg. What is actual investing? We believe that it's our real world task to deliver thoughtful capital deployment. It's not about speculating over the short term. It's about understanding the long term opportunities for companies through technological progress or new business models. So we seek out those exploring big new ideas that will change the world. Then we back them to give those ideas time to flourish. Baillie Gifford Actual investors Find out more@baileygifford.com support for the show comes from public on public you can build a multi asset portfolio of stocks, bonds, options, crypto and now generated assets which allow you to turn any idea into an investable index with AI. It all starts with your prompt. From renewable energy companies with high free cash flow to semiconductor suppliers growing revenue over 20% year over year, you can literally type any prompt and put the AI to work. It screens thousands of stocks, builds a one of a kind index and lets you back test it against the S&P 500. Then you can invest in a few clicks. Generated assets are completely customizable and based on your thesis, not someone else's. Go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market paid for by Public Investing Brokerage Services by Open to the Public Investing Inc. Member FINRA and SIPC Advisory Services by Public Advisors llc. SEC Registered Advisor. Generated Assets is an interactive analysis tool. Output is for informational purposes only and is not an investment recommendation or advice. Complete disclosures available at public.com disclosures if a Lenovo gaming computer is on your holiday list, don't shop around. Just go directly to the source Lenovo.com it's your last chance to score exclusive deals on the gaming PCs you want, like the Lenovo Legion Tower 5 Gen 10 gaming desktop and Lenovo Lock Gaming Laptop. So avoid all that shopping chaos and price comparing and just go directly to the source Lenovo.com, where PCs are up to 35% off. That's Lenovo.com. Running a business is hard enough, so why make it harder? With a dozen different apps that don't talk to each other, one for sales, another for inventory, a separate one for accounting. Before you know it, you are drowning in software. Instead of growing your business, this is where Odoo comes in. Odoo is the only business software you'll ever need. 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For more on all of this, guest host Isabel Lee and I, we're joined by Anuragrana, Bloomberg Intelligence technology analyst. We first asked him to give us his take on Oracle's results. So there are a few things to keep in mind. The number one thing is cloud infrastructure growth. Consensus was 69%. They came at 66. I know it's a very big number. However, in the cloud world missing by even 1 percentage point is not good. So that's first thing. But there's a very logical reason about it. Everybody can see the backlog. So it's not as if they don't have a business there. But converting that backlog into sales is an issue. Everybody knows that there is a capacity constraints out there, whether it's data center, whether it's networking, etc. Power is a very big issue, for example. So that's one area of it. But although I would say the management did not harp on it as much as we would wanted them to be that to explain why the, why the growth can improve going forward. So that's one factor. But I think the biggest question is something that we had discussed earlier also is everybody is questioning that out of their big backlog which is over 500 billion right now, 300 plus billion of that comes from OpenAI now OpenAI currently, or the order book is from OpenAI by the end of this year, OpenAI will have a revenue run rate of about 20 billion. So everybody is saying that, okay, well tell me if you have revenue of 20 billion, how, how are you going to spend 300 billion just with Oracle? So there's a big question mark, but then your question is, well, why didn't this happen when they first announced it? Well, their model was at the top at that point and right now Google's Gemini has caught up. So people don't know what will OpenAI's future look like two years from now, three years from now and so forth. So there are multiple factors that are going into this equation and not to mention that capex is going to go up by 15 billion. So 35 billion going to 50 billion. So it's a big, big change across four or five different vectors that are having an impact. So the cloud strategy of Oracle continues to evolve. What is the next major inflection point for you when you see these cloud companies really move towards more AI driven efforts. So the big thing is that 500 billion of backlog needs to bleed into revenue. For that they need to open new data center, but to open new data center they need more cash. So the big catalyst for them is they need to go out. Most likely they need to create a special purpose vehicle where they can raise funds with the help of private equity investors, private credit, and basically keep that off Oracle's balance sheet. And that will help pacify these fears that they actually have a way to finance this big order book that they have. All right, you mentioned OpenAI. Can you refresh my memory? Because I have no idea where do they get their money? Where are they getting the money to, I don't know, to do all this stuff. So the single biggest is the consumer app. Right now that's where most of the money is coming in. Because if you want the best model, you're going to pay $20 a month. I mean, you can get the free version of it, but that's one area. They have over 900 million users right now, but only a small portion of them are paying customers. So that's. One second is if you as a company, let's say you're, you know, let's call a hypothetical bank and you're creating a chatbot which needs intelligence or a large language model, you're going to use APIs from OpenAI and that gets embedded intelligence into whatever system that you're creating, your chatbot that becomes smarter, they get paid from that. So those are the two, I think, big elements or the big sources of revenue for them. And there is a huge, you could say looking ahead, all the enterprises around the world will have some intelligence into their core applications and they're going to use model from somebody, whether it's Google, whether it's anthropic, whether it's OpenAI. Our thanks to Anuragran, a Bloomberg Intelligence technology analyst. We move next to some news at Berkshire Hathaway. This week the firm announced a handful of leadership changes, including the retirement of its longtime chief financial officer, Mark Hamburg. This comes as the $1 trillion conglomerate prepares for the retirement of CEO and billionaire investor Warren Buffett. For more on this, co host Scarlet Fu and I were joined by Matthew Palazzol, a Bloomberg Intelligence senior analyst covering the P and C insurance industry. We first asked Matthew to talk to us about some of the turnaround we're seeing at Berkshire. So the big News. I think the bigger news of the announcements was Todd Combs, the, the, one of the investment deputies and CEO of Geico is moving to JP Morgan. So I don't know if that was a planned thing or what, but that seems like an unwelcome shake up in light of Buffett leaving at the end of the year. I would say his investment track record at Berkshire not very transparent. They don't really tell you what the investment managers are doing aside from Buffett. So I think many of the big moves are made by Buffett anyway. I actually do think that GEICO had some issues with loss costs going up. So the cost of car accidents was going up a lot. Combs reaction was to like cut a lot of costs and shed a lot of policies, which is actually the opposite of what I thought Berkshire would do. I thought they'd kind of ride it out and maybe gain some market share. And I do think Progressive handled that environment a little bit better. So I think it will be a manageable loss. But probably the biggest news. Yeah, Todd Combs we should mention, was already a J.P. morgan board member. So he had a relationship with the bank and he's going to be advising Jamie Dimon and other senior JP Morgan leaders on strategic issues. Let's talk a little bit about the changes that involve a new general counsel position over at Berkshire as well. So this is a brand new position that they're creating versus I guess in the past they just relied on paid outside help, outsourced it, I believe to a firm that was associated with Charlie Munger, you know, not, not a huge deal, I don't think. I mean, I think it makes sense for them to have their own gc. Why not? I mean, Berkshire Hathaway, I think really the, the outsourcing was in part due to it being, you know, related to the company anyway. So I think it's important. Obviously they're going to face tons of legal issues across all of their companies and I think, you know, probably each one has their own individual, but it would be, probably makes a lot of sense to have this all roll up to someone at the top. What's the call? What's the sentiment out there on the street? It's tough because you can look at it and say out of their core competencies, are they going to do any of that any better now? Right, You've got Buffett going away, you've got a Jeet Jane who is in charge of the insurance operations. He's getting old, he's been selling a lot of stock. So maybe he leaves. And he was kind of the magic sauce behind a lot of the insurance business. So you've kind of got these two titans of the company perhaps being gone and saying, well, how could they be as good in investing or as good at the insurance business? And it would be tough to say that they would be. But when you have Abel coming in, it was a positive sign of some shakeup. And maybe his strength is he's not Buffett, while his weaknesses he's not Buffett also, but his strength is he doesn't have to do things the same way. And perhaps he takes a different look at capital allocation. I think think the Street's hopeful that we see some more capital allocation come out of Berkshire. Our thanks to Matthew Palazzola, Bloomberg Intelligence Senior insurance Analyst. We move next to some news at the American restaurant and gift shop chain Cracker Barrel. This week the chain said it expects sales for the current fiscal year to fall faster than it previously forecast. This suggests Cracker Barrel brand is hurting from the firestorm that erupted following its attempt to use a new streamlined logo. The company also planned to update its dining rooms and to give them a more modern feel. For more on all of this, guest host Christine Aquino and I, we're joined by Michael Halen, Bloomberg Intelligence senior restaurant and food service analyst. We first asked Michael to break down Cracker Barrel's most recent earnings report. Guidance was cut and this was their fiscal first quarter. So it's always tough to have a guidance revenue and EBITDA cut after your first report. But they hadn't seen a bounce yet in their traffic post logo change controversy and everything that that went along with it. You know, on the positive side, they said, you know, traffic has now steadied at this down 10 to 11% level, which is translating into a, you know, a down a mid single digit same store sales. You know, so if you're, if you're a glass half full investor, you're saying that, you know, after the stabilization comes an improvement. You know, their new guidance has a pretty wide range. So the low end of the range is assuming no improvement through year end, which we think could be sounds pretty conservative to us. You know, and then on the higher end they would see a gradual slow improvement in traffic going forward. So what are they going to do? You know, it's, it's going to continue to be about improving the operations. Right? That's been, you know, a key tenant under CEO Julie Macino. It's also going to be food innovation. It's going to be Southern favorites. It's going to be twists on old classics. It's going to be bringing back items that people love, they want to see return to the menu. But I think what really stood out is that their willingness to listen more closely to their customers. I think that's a big key point of focus for them moving forward after the controversy that they suffered. Well, Michael, so in terms of what are they going to do? Right. It seems that cutting capex is a part of the plan. Is that something that you think would signal discipline or does it actually risk slowing the turnaround even more? Well, they're going to still refresh the stores. What they're cutting back on is a more extensive remodel which was in tandem with the logo change, which was something that was angering customers. Right. So I think the capex change is probably, you know, the lowered capex is probably smart. But they're going to continue to refresh their stores. They're going to continue to give them a fresh coat of paint, improve floors where they need to clean up the bathrooms, things of that nature that nobody's going to get up in arms over. I'm actually surprised in hindsight that maybe this management team kept their jobs there. I mean this was a real self inflicted wound there. What's the shareholders been saying? Has there been any pushback? Yeah. So listen, Julie Messino, you make a great point. Point, Paul. And Julie Macino, the reason why I believe she's still there is that she was doing a great job until this controversy hit. You know, this is a chain that had been bleeding traffic for years. Right. They've been really struggling for a long time to bring in younger consumers. Right. And she had shown pretty good success over the 12 months leading into the the logo changed. Same store sales at the restaurants were up 5% in the August quarter. So I think that's why, you know, the proxy fight kind of failed, the attempt to remove her from the board failed and why she still has her job right now is that this chain was a mess prior to her arrival and she was showing some pretty good progress up until August. Our thanks to Michael Halen, Bloomberg intelligence senior restaurant and food service analyst. Coming up, we'll look at how earnings at the food and beverage company Campbell's were impacted by the holiday season. You're listening to Bloomberg Intelligence on Bloomberg Radio providing in depth research and data on 2,000 companies and 130 industries. You can access Bloomberg Intelligence via big on the terminal. I'm Paul Sweeney and this is Bloomberg. 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This is Bloomberg Intelligence with Scarlet Fu and Paul Sweeney on Bloomberg Bloomberg Radio. We move next to the quarterly earnings for the food and beverage company Campbell's known for its iconic soups and snacks. This week, the company reported first quarter earnings that beat analysts expectations. This was positive, largely thanks to some holiday inventory build by retailers. For more on this and her outlook on packaged foods, Scarlett and I were joined by Diana Rosero Pena, Bloomberg Intelligence consumer staples analyst. We first asked Diana about Campbell's two businesses, the snacks business and the meals and beverages portfolio. You know, for meals and beverages, there's some headwinds on ready to serve soup, whereas broth and condensed soup, which is usually used in cooking, is improving. You know, you have V8, which is not really. It's a brand that is not really doing that well. So I love V8. You do? Well, to me, to me, that's like my healthy eating for the day when I drink a little one in the morning. So when you're on a plane, you'll get a V8 and you're like, I'm good, I'm good, I'm good. No need to work out, no need to go to the gym. Exactly. So. But it's still facing some headwinds for snacks. It's. It's kind of. I found it odd because there seems to be a bifurcation of the consumer trends here. You have salty snacks being, you know, challenged by people trying to eat healthier, reducing their sodium. But then you have cookies outperforming. So I guess is the salad with the fries all right? Which I love, by the way. Yes. Yeah, absolutely. Campbell Waltz agreed to take a 49% stake in LA Regina. What is La Regina? What's Campbell's trying to do here? Yeah, so that is the supplier for Rao's, which they bought it a year or so ago. And that makes it kind of like have a little bit more control on the supply side. There has been some headwinds on this brand because tomatoes are being exported or imported to the United States. So they have to face some tariffs. So, you know, with this, they are trying to not only offset tariffs, but have a little bit more on the, on the supply chain, have a little bit more control on that. Here's my rail story. I mean it's for people aren't in New York City. It's a very famous restaurant in New York. It's very difficult to get a table there to get a reservation. On my 30 years of wall Street, I've asked people to take me who I know go there to take me. I haven't gone once. Really? Yeah. I mean it is impossible. Like I never asked people to take me out on their great golf course. I just wait for the invite to come. But for Rao's, I've actively tried to get and haven't gotten any. Struck out. So anyone who has an invite into Rao's, let Paul Sweeney know. Exactly. Exactly. You know, I did actually get to eat there. We ordered takeout during the pandemic when they were doing takeout. Yeah. So that was my one time I got to eat Rao's. Very good. But Diana, I want to ask you about, of course, the controversy that surrounded Campbell's just last month. There was an executive, he was the vice president of the IT department who talked about how the company's products are being made for poor people and you know, had some disparaging remarks about some of the employees, the Indian employees. Is that something that's going to cast a pall over Campbell's? I mean, do you see any long term effects from that? Well, usually they did not address that during the call, but I think it's, it might be a short term headwind if there's any boycott happening. I don't, I'm not necessarily, I don't necessarily think that there is going to be one. It's just one executive and the company went ahead and, and kind of tried to put on record that they're not necessarily agreeing with what, what he said. So it's, you know, it. I don't necessarily see that as a significant headwind for the company. Packaged goods companies, I kind of think of them kind of a GDP top line growth story at best. What's the 2026 outlook for your companies? What are investors looking for? So for 2026, they're hoping that there's some light at the end of the tunnel in terms of volume growth. Again, it might be a second half of the year story because comps get a lot easier going forward. But profitability seems be to be a little bit more difficult because they have tariffs, they have to contend costs still are a little bit higher. Specific specifically on the employee side. And there's also marketing that they have to do because they want to spur growth. And pricing is not necessarily the, you know, the only lever that they have to. But, you know, I think about Campbell's and other packaged foods companies and how much competition they must face from private label products. I go to the supermarket, I'm going to get the chicken broth that's cheapest and it's usually the one sold by the supermarket and not Campbell's or anyone else's. So that's, I mean, and for private label you don't need to do any marketing. Exactly. So what is there? How do they counter that? Well, more marketing. They're trying to work with the, with the retailers to position themselves in the best part of the shelf to be able to move the product. Yeah, well, obviously retailers have to content with increasing their private label penetration and at the same time have a good relationship with this national brand. So they're not necessarily want them to go against, you know, this product. So they're trying to. There's some negotiations happening and usually, you know, when I speak to retailers, because I do cover Canadian retailers, they mentioned that they tried to expand their private label into white spaces, not necessarily serve but national brands. So while you might see some, you know, condensed soup, private label, it's not as intricate or as better quality than probably Campbell's. Our thanks to Diana Rossero Pena, Bloomberg Intelligence Consumer staples analyst on Bloomberg Intelligence. We often look at research from Bloomberg nef, previously known as New Energy Finance. They're the team at Bloomberg that tracks and analyzes the energy transition from commodities to power, transport, industries, buildings and agricultural sectors. This week we took a look at the renewable fuels business. According to BNEF, last year the US imported over 800 million gallons of biodiesels. But this year we're on track to import just 10% of that. The US is now the largest producer of biofuels in the world. For more, I was joined by Anna Davies, Bloomberg BNEF head of renewable fuels. I first asked Anna to break down what biofuels are and how that business has changed under the new Trump administration. When we say renewable fuels, we're mostly meaning biofuels at the moment. And these are things you might be familiar with, like ethanol and biodiesel that are mixed into your gas or diesel streams. There's some new ones coming as well. There's one called renewable diesel, which unlike biodiesel, it's basically identical to fossil diesel, but just made from crops or waste feedstocks. So that means you can basically substitute it one for one into your diesel stream and you don't have to worry about engine Performance and things. And then also there's a bio version of jet fuel called sustainable aviation fuel. All right, all right, so I've heard of those. Now my understanding is we do produce some of that stuff here in the US but we also import a lot. So how's that whole world changing? Yes, so we produce a lot of it at home and we're growing our production. Ethanol is the biggest, but there's a growing segment of these drop in fuels that I mentioned, like jet fuel and renewable diesel. We produce a decent amount of that here in the US and we're increasing the capacity to do so. There's a lot of old oil refineries actually in California and the Gulf coast that they're converting to take in biofeed stocks rather than fossil fuel feedstocks. But we also import a lot of these fuels. Neste is a big producer in Singapore and Rotterdam and a lot of that gets imported here for use in our markets. So do we need imports though? Because I'm just looking here, you know, I guess last year we imported over 800 million gallons of biodiesels. This year we're on track to import just 10% of that. Yes. Wow. Is that just tariffs? This is policy. Policy. Policy changes the U.S. the main reason biofuels get off the ground anywhere is due to policy, because otherwise they wouldn't. The economics on their own don't work. Biofuels are more expensive than their fossil counterparts. You usually need some policy to incentivize them. The US has a main policy called the renewable Fuel standard which obligates refiners to blend in certain amounts of biofuels into their refining streams. We also have tax incentives and we've kind of both of those have now been changed in the last year or so, which is really causing the market to whiplash. In the tax incentive side of things, there used to be a tax incentive called the blender's tax credit, which was basically $1 per gallon for all biofuels in the US and that's a pretty attractive offer. It ended in 2024 and it's been replaced by the Clean Fuel Producers tax credit or the 45Z. Now that tax credit is a sliding scale based on your emissions. And most biofuels aren't zero emissions, so they still have some. So they don't get the full dollar value anymore. And now only domestically produced fuels are eligible for that tax credit, so imports no longer get it. And then on top of that, the volume obligation is currently being set by the Environmental Protection Agency. That's the agency that oversees this program and they have proposed a volume for 20, 26 and 27 that's quite aggressive, that's quite strong. It would basically require all of the US capacity to be operational in producing fuels and likely also either imported fuels or feedstocks because we need to actually meet that, be able to produce that somehow. Well, this administration is definitely pro farmer, like all that kind of stuff. Some of the feedstocks you would put put into renewable energy. So that's a good thing, right? It is a good thing. That is, I think one of the reasons for a lot of these changes is to promote domestic soybean oils use in biofuels. The challenge is that only works if you have access to U.S. soybeans. So for instance, a lot of the biodiesel production, those conventional biodiesel facilities, they're located in the Midwest, right near soybean farms, right near crushing capacity. So it's relatively easy for them to use soybean oil. But a lot of these newer facilities producing renewable diesel or jet fuel are located in California or the Gulf Coast. And there it's much harder. You'd have to bring it in by rail and there's not much capacity there. And it's a lot easier to bring a shipment full of waste oil from China, say, than to bring, to even get access to the soybeans. So it's unclear if those facilities will be able to switch. So I was at a Bloomberg Philanthropies sponsored conference at the Plaza Hotel a couple of months ago talking about this transformation, evolution into cleaner energy. And the guests we had on, non US guests, international guests, their basic message was, hey, we being the rest of the world, we're moving forward with this stuff. We're not slowing down or stopping us. If you want to come along, that's great. If you don't, that's great too. Is that kind of how the world's thinking about it? At least in the short term? It is. I think everybody is taken a bit aback by it because the US has generally had the most attractive incentives. You can stack all these credits and you get an attractive number that can kind of bridge that cost gap. But there is a lot of policy momentum in the rest of the world moving forward rather than back. And so you can see a lot of the shift happening. For instance, Europe, the EU and the UK both instituted a sustainable aviation field mandate this year. So we anticipate a lot of those volumes from Singapore might flow that way. Singapore itself has a new staff mandate, so they might even keep the volumes at home and then China is an interesting one to watch because they're, they're building a lot of new capacity to produce these fuels. So it's unclear whether their feedstocks will go elsewhere or if they'll keep a lot of it domestically for increasing their own production. Our thanks to Anna Davies, Bloomberg BNEF Head of Renewable Fuels. That's this week's edition of Bloomberg Intelligence on Bloomberg Radio providing in depth research and data on 2,000 companies, companies in 130 industries. And remember, you can access Bloomberg Intelligence via Bigo on the terminal. I'm Paul Sweeney. Stay with us. Today's top stories and global business headlines are coming up. Right now, if a Lenovo gaming computer is on your holiday list, don't shop around. Just go directly to the source Lenovo.com it's your last chance to score exclusive deals on the gaming PCs you want, like the Lenovo Legion Tower 5 Gen 10 gaming desktop and Lenovo Lock Gaming Laptop. So avoid all that shopping chaos and price comparing and just go directly to the source Lenovo.com where PCs are up to 35% off. That's Lenovo.com Lenovo get ahead with one dose. Xofluza, biloxavir, Marboxyl, Zofluza is available for delivery by mail or at your local pharmacy. Don't wait until it's too late. Be ready with Sofluza. 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