Musk Paid $23B to Focus on Tesla & Is ‘Athleisure’ Wear Dead?

Summary

Morning Brew Daily - Episode Summary Title: Musk Paid $23B to Focus on Tesla & Is ‘Athleisure’ Wear Dead? Release Date: August 5, 2025 Host: Neal Fryman & Toby Howell

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1. Elon Musk's Monumental Compensation Package for Tesla

[03:06] Toby Howell: "But this bonus package doesn't really fit that pattern. It's more like throwing stuff at a wall and just hoping it will stick."

Elon Musk continues to be the linchpin of Tesla's future, as the company's board approved an unprecedented compensation package worth approximately $24 billion in Tesla shares. This move aims to ensure Musk remains dedicated to steering Tesla through its ambitious ventures, including advancements in robotics and autonomous driving.

[04:46] Neal Fryman: "To retain Elon is more important than ever before."

The compensation package comes in the wake of legal uncertainties surrounding Musk's previous $56 billion award, which was invalidated by a Delaware judge due to concerns over Musk's influence on the board. In response, Tesla has relocated its incorporation from Delaware to Texas, providing greater legal insulation for future executive agreements. This strategic shift underscores Tesla's dependency on Musk's leadership, especially as the company grapples with a significant stock decline and aims to rebound from its recent earnings slump.

2. The Revival of Outdoor Voices and the Future of Athleisure

[07:25] Toby Howell: "As we've moved way past the leggings pants debate, athleisure isn't just a category, it's just clothes."

Outdoor Voices is staging a comeback under the leadership of its founder, Ty Haney, who returns to helm the company after its acquisition by Consortium Brand Partners. Originally celebrated as the queen of athleisure, Haney's return marks a shift from mere functional wear to a more fashion-forward and sexy approach. Despite the initial backlash that led to the brand's downfall in 2020, the new collection aims to reclaim its cultural relevance in a saturated market dominated by competitors like Vuori, Athleta, and Alo Yoga.

[09:42] Neal Fryman: "It will be very interesting to see if she can capture some of the magic that she had back from 2013 to 2020."

With the athleisure market projected to soar to $716 billion by 2032, the relaunch of Outdoor Voices positions the brand to capitalize on the enduring appeal of versatile, stylish athletic wear. The strategy hinges on leveraging Haney's previous success and adapting to the evolved fashion landscape where athleisure has become mainstream.

3. American Eagle's Stock Surge Following Trump's Endorsement

[10:30] Neal Fryman: "We don't really care that much about the noise. A lot of that is bringing new investors into the company."

American Eagle experienced a significant stock increase of nearly 24% after former President Donald Trump endorsed its controversial ad campaign featuring Sydney Sweeney. Trump's praise on Truth Social highlighted the campaign as "the hottest ad out there," prompting investor optimism despite mixed public reactions.

[12:05] Toby Howell: "So the real question is is whether this ad campaign is actually going to convince shoppers to buy the company's apparel."

The ad, which plays on the word "genes" with the tagline "Sydney Sweeney has great jeans," sparked debates over its messaging, with criticisms ranging from perceived eugenics implications to over-sexualization. While the immediate financial impact was positive, the long-term effect on consumer behavior remains to be seen as the company prepares for the back-to-school season.

4. Restaurant Industry Embraces Spicy Food Trend

[15:01] Neal Fryman: "Imagine if Gen Z consumers were like, we love lamb and goat...to make a spicy food all you need is some peppers and maybe some creativity in the kitchen."

Restaurants across the United States are heavily investing in spicy menu items to attract younger demographics, particularly Gen Z, who favor bold and adventurous flavors. From Chipotle's Spicy Adobo Ranch to Taco Bell's Mike's Hot Honey Diablo Sauce, the trend has seen 76 new spicy offerings between March and June alone, with 95% of restaurant chains now featuring at least one spicy option.

[16:01] Toby Howell: "There's something about watching people suffer...and just have that really red mouth while they're eating a ghost pepper chip."

The surge in spicy foods is not only a culinary trend but also a social media phenomenon, with spicy challenges and mukbangs driving online engagement. This synergy between food trends and digital platforms ensures that the popularity of spicy items is likely to endure, providing restaurants with a cost-effective means to generate buzz and increase sales.

5. Boeing Faces Labor Strikes Amidst Financial Challenges

[19:16] Neal Fryman: "Boeing's impressive turnaround has hit a roadblock."

Boeing is navigating through renewed labor unrest as 3,200 machinists in the St. Louis area strike over a rejected four-year contract. This is the second such strike within a year, following a previous walkout by 33,000 workers. Despite these disruptions, Boeing's CEO Kelly Ortberg remains optimistic, asserting that the company can manage the impact of the strike.

[20:28] Toby Howell: "It's still a part of their business has actually lost a lot of money of late. It's lost nearly $11 billion dating back to 2021."

While the current strike is relatively smaller compared to past labor actions, it poses a significant hurdle for Boeing's efforts to return to profitability, which the company was on track to achieve before the strike commenced.

6. Palantir's Stellar Performance and Strategic Growth

[22:24] Neal Fryman: "A broader trend here is, he said, we're planning to grow revenue while decreasing our number of people."

Palantir Technologies has emerged as the best-performing stock in the S&P 500 for consecutive years, with its latest earnings report surpassing Wall Street expectations. The company's revenue exceeded $1 billion quarterly for the first time, driven largely by a 53% increase in US government contracts. CEO Alex Karp expressed immense pride and optimism in leveraging government partnerships to sustain growth.

[23:13] Toby Howell: "Companies like Palantir are just openly bragging about that."

Palantir's strategy focuses on expanding revenue while reducing headcount, a trend among tech companies enabled by advancements in AI and automation. Karp's vision includes achieving tenfold revenue growth with a leaner workforce, positioning Palantir as a formidable player in both the AI and defense sectors.

7. Joby Aviation and Blade's Air Taxi Expansion

[24:19] Neal Fryman: "It's very odd to see both companies stocks surge so much like that."

Joby Aviation announced plans to acquire a portion of Blade's helicopter taxi service for $125 million, signaling a significant push into the electric air taxi market. Blade, known for its short-distance helicopter rides, will benefit from Joby's innovative electric fleet, potentially reducing operational costs and making air taxi services more accessible.

[25:14] Toby Howell: "Blade... reported $250 million in revenue last year, but nearly 60% came from its Oregon transportation business."

The acquisition strategy aims to merge Blade's existing customer base and operational expertise with Joby's sustainable technology, enhancing the viability and scalability of urban air mobility solutions. Both companies saw their stocks rise by approximately 18% following the announcement, reflecting investor confidence in the future of electric air taxis.

8. Launch of the 'California Post' by New York Post Media Group

[26:09] Neal Fryman: "It's easy to see why Rupert Murdoch's News Corp. Which owns the Post, thinks going Hollywood is low hanging organic fruit."

The New York Post Media Group is set to launch a new Los Angeles-based publication, the "California Post," slated for early next year. This expansion aims to bring the Post's distinctive, sensationalist coverage and celebrity gossip to the entertainment hub, capitalizing on the growing digital readership in the region.

[26:25] Toby Howell: "I'm curious to see how it actually plays out in practice."

Despite skepticism about the Post's conservative lean in a predominantly progressive city, the move responds to a void left by widespread layoffs in the local journalism sector. The "California Post" seeks to blend AI and technology coverage with Hollywood-centric news, potentially reshaping the LA media landscape with its bold editorial style.

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Conclusion

In this episode of Morning Brew Daily, Neal Fryman and Toby Howell delve into significant developments in the business and economy sectors. From Elon Musk's hefty compensation package and Outdoor Voices' strategic revival to American Eagle's stock boost from political endorsement and the booming trend of spicy foods in restaurants, the hosts provide insightful analysis into each topic. Additionally, the episode explores labor challenges at Boeing, Palantir's impressive growth, the evolution of electric air taxis, and the New York Post Media Group's latest venture into Los Angeles. The discussions are enriched with notable quotes and timestamps, offering listeners a comprehensive understanding of the day's most pressing business news.

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Notable Quotes:

• "To retain Elon is more important than ever before." – Neal Fryman [04:46]
• "But this bonus package doesn't really fit that pattern. It's more like throwing stuff at a wall and just hoping it will stick." – Toby Howell [05:45]
• "Imagine if Gen Z consumers were like, we love lamb and goat...to make a spicy food all you need is some peppers and maybe some creativity in the kitchen." – Neal Fryman [15:01]
• "Companies like Palantir are just openly bragging about that." – Toby Howell [23:13]

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Stay Updated: For more insights and daily updates, tune in to Morning Brew Daily available on all podcast platforms and YouTube. Share your thoughts or feedback by reaching out to Morning Brew Daily at MorningBrew.com.

Transcript

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[Neal Fryman]

Good morning, Brew Daily Show. I'm Neal Fryman.

[Toby Howell]

And I'm Toby Howell.

[Neal Fryman]

Today, Tesla found a new way to keep Elon Musk focused on work. A whole lot of money.

[Toby Howell]

Then American Eagle shares soared after Trump endorsed Sydney Sweeney's controversial ad. It's Tuesday, August 5th. Let's ride.

[Neal Fryman]

Good morning and happy Tuesday. I want to quickly take us out west, where the government has been deploying some creative methods to combat a spike in gray wolf attacks against livestock. The problem they're facing is that the wolf population has surged since being reintroduced to Yellowstone in 1995, leaving ranchers defenseless to protect their cattle and sheep. The latest solution, according to the Wall Street Journal, is to use drones to scare off the wolves by blasting the predators with haunting audio clips from the drone speakers and by haunting audio clips. The recordings include AC DC's Thunderstruck. And this is true, a clip of the fight between Scarlett Johansson and Adam Driver in the movie A Marriage Story. Tell me nothing more terrifying than ScarJo and Driver hurling barbs at each other. I'd absolutely run the other way.

[Toby Howell]

Well, now I'm sitting here thinking about other things a drone could play that would have an animal sprinting the other direction. And the first thing that came to mind, unfortunately, was good daily shit. Just kidding. That would have the wolves sitting at rapt attention. No, I feel like maybe playing Benson Boone would have them scurrying away or doing flips off of a piano.

[Neal Fryman]

Don't do my boy like one of the two.

[Toby Howell]

My favorite part of this story, though, is the nominative determinism that's at play here. The USDA district supervisor who is piloting this drone program is named Paul Wolf.

[Neal Fryman]

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[Toby Howell]

Yeah, I wasted an invite to my birthday party on an ungrateful co worker who apparently didn't even want to be there.

[Neal Fryman]

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[Neal Fryman]

Join the community on LinkedIn ads. LinkedIn will even give you a $100 credit on your next campaign so you can try it for yourself. Just go to LinkedIn.com b d that's LinkedIn.com/mbd terms and conditions apply only on LinkedIn ads. What would it to keep you engaged at work? Maybe it's a 10% raise, but for Elon Musk, it's the GDP of Albania. Yesterday, Tesla's board approved a new pay deal for their CEO, awarding him 96 million shares worth about $24 billion. And it's all about making sure he doesn't lose focus on Tesla for the next couple of years. In a note to shareholders, the board wrote that retaining Elon is more important than ever before. While we recognize Elon's business ventures, interests and other potential demands on his time and attention, all are extensive and wide ranging, we are confident that this award will incentivize Elon to remain at Tesla. The reason the board needs to incentivize Elon to remain at Tesla is because his previous pay package remains in legal limbo. Remember this drama Back in 2018, Musk was handed the biggest award in US corporate history, worth $56 billion. But last year, a Delaware judge struck it down, saying that the process was compromised by Musk's influence over the board and the directors weren't acting independently when they approved it. While Tesla is currently appealing that ruling, the lack of certainty led the board to create an interim pay structure it described as a first step good faith payment aimed at keeping the world's richest person engaged at his job. So Toby, instead of booting Musk for being too distracted, the board is doubling down on their guy. And investors like the move, sending Tesla stock up 2% on the day.

[Toby Howell]

You know what Neal? I'm feeling a little distracted as well. Maybe I could use a little something to focus my attention again. But yes, this bonus does not necessarily follow the structure of other bonus packages you would expect to see out of corporate America, because executive bonuses are meant to reward good behavior, incentivize more of that behavior. But this bonus package doesn't really fit that pattern. It's more like throwing stuff at a wall and just hoping it will stick. Hoping maybe Musk will change his ways and divert more of his attention back to their company. But it does seem like it. They are coming from a position of weak leverage, saying, like, please take this money. Take all these billions and billions of dollars. Just focus us on us again, please. But they're kind of have their back against the wall, because without Elon, Tesla does not have a true path forward. Their move into robotics or move into autonomous driving, that takes a massive hit. So they need Elon. And it's clear by the fact that they're throwing all this money at him.

[Neal Fryman]

Yeah, I thought some of their reasoning was really interesting. They obviously think that Elon is their North Star, he is the company. But they also said that, to be clear, losing Elon would not only mean the loss of his talents, so his talents, but also the loss of a leader who is a magnet for hiring and retaining talent at Tesla. They said this was key against the backdrop of the ever intensifying AI talent war and Tesla's position at a critical inflection point. We've talked so much about Mark Zuckerberg's very personal and intense push to recruit these AI researchers who are dime a dozen. They think that Elon Musk plays that similar role for Tesla at a time when the competition is heating up to retain all of this talent that pushes this automaker into the AI realm.

[Toby Howell]

Also, Texas plays a big role in this as well, because this new pay package. After the debacle that happened with Delaware, Elon moved the company's headquarters from being incorporated in Delaware to being incorporated in Texas. And Texas is basically immune from suits similar to the one that Delaware brought because in to sue in the state, shareholders must own at least 3% of a company. Tesla is a massive, massive company that is a very high threshold to meet. So basically, this next pay package is much more insulated from the type of suit that torpedoed his last gigantic pay package.

[Neal Fryman]

So bottom line here, Elon Musk will probably be the CEO of Tesla for the next couple of years, and he's got a big turnaround job ahead of him. Tesla Stock is down 18% year to date. They just had their worst earnings report for a quarter in recent memory. He's got a lot of work ahead and he will be paid handsomely for it.

[Toby Howell]

Remember Outdoor Voices, the millennial coded brand that had everyone don a doing things hat and rocking yoga pants on their coffee runs? Well, it's Ousted founder Ty Haney, once dubbed the Queen of Athleisure, is back at the helm once more, ushering Outdoor Voices into a new generation with a new collection dropping today. Founded in 2013amidst the rise of Lululemon, OV rode mono colored leggings, the idea that people should wear workout clothes not just to the gym but everywhere, to a $110 million valuation in 2018. But after reaching the highest of highs, it all came tumbling down in 2020amidst backlash against Haney. With the company kneecapped, Outdoor Voices closed all its doors and was snapped up by a P E firm, Consortium Brand Partners. To avoid bankruptcy, the big turnaround plan quietly asked Haney to come back home and try and right the ship, setting up today's triumphant return. So what does Outdoor Voices 2.0 look like? In a recent interview with Texas Monthly, Haney admitted that despite helping mainstream it, she actually always hated the word athleisure and instead used terms like fashion forward and sexy to describe Outdoor Voices new drop. It's a much different fashion landscape now too. We've moved way past the our leggings pants debate. Clearly the world has already decided yes, and at this point, athleisure isn't just a category, it's just clothes. And it's into that landscape that Outdoor Voices hopes to regain the its cultural cachet.

[Neal Fryman]

Neil I'm getting flashbacks to 2018 so bad. Hope I could do that this early. But back then this brand was everywhere. Ty Haney was one of those so called GirlBoss CEOs who was on magazine covers, on panels. She was everywhere and so was this brand. But then like so many other D2C companies, I'm thinking Casper and Allbirds that became huge via cheap Instagram and Facebook ads. It all came tumbling down. And since Tahaney left, this company has been essentially a zombie company, not really updating any of its products on its website. Closing all of its stores. Will be very interesting to see if she can capture some of the magic that she had back from 2013 to 2020 when this brand was truly everywhere, all around New York City and they had a big community of engaged customers willing to go out and be brand brand ambassadors for it.

[Toby Howell]

I see the logic behind trying again, because if I'm Consortium Partners, I'm looking at the athleisure market. It's absolutely exploded. It's projected to reach 716 billion billion by 2032, according to Fortune. But then I also look at rival brands that have emerged in the post Outdoor Voices landscape. Brands like Vuori, who basically is like Lulu. Outdoor Voices for Guys was valued at five and a half billion dollars last year. And then of course, you still have Athleta Lulu Alo Yoga is another big one that's been making waves. So why it's worth a shot at least to try to cash in on whatever cachet that this brand has left, whatever Rand name recognition that has left, and try to run it back with Haney at the helm. So I definitely see the boardroom conversation here that led to this relaunching.

[Neal Fryman]

Moving on in news that would make absolutely zero sense to someone in 2015, American Eagle stock soared after President Trump weighed in on the brand's controversial Sydney Sweeney ad campaign. In a long post on Truth Social, Trump called the Sweeney spot the hottest ad out there and added that American Eagle jeans are flying off the shelves. Whether or not that's true, investors tried to manifest it, sending shares of the shopping mall legend up nearly 24% on the day to their highest close since May. And now, with Trump's post, it is official every single person in the United States has offered their take on the Sydney Sweeney American Eagle brand deal. To catch you up, last month, American Eagle launched its most expensive partnership ever, a jeans promotion featuring the actress of the moment, Sydney Sweeney. But it's generated loads of controversy because of the messaging. The campaign's tagline is Sydney Sweeney has great jeans, which is meant to be a play on words with the denim pants and the basic units of heredity. In some of the ads, the blonde, white, very attractive Sweeney leans into the DNA angle of it all, saying genes are passed down from parents to offspring, often determining traits like hair color, personality, and even eye color. My genes are blue. Some on the left blasted the ads as tacitly embracing eugenics, being overly sexualized and targeting men. When American Eagle is ostensibly trying to get women to buy these jeans, the backlash prompted a backlash of its own, with others calling the ads critics too woke and humorless. In the middle of the crossfire is American Eagle. While the stock has soared since the campaign was launched, its reputation is in a more precarious place.

[Toby Howell]

Yeah, this certainly worked in the financial markets. American Eagle has been kind of stuck in neutral over the first half of the year. Its stock is actually down 20%. Still, even after this multiple rises that have come from these Sydney Sweeney ad, you know outrage cycles. But Trump's comments doesn't introduce any new information about the company, doesn't change anything about the fundamentals of its business. It is just drawing investors in it to the hype cycle. So the real question is is whether this ad campaign is actually going to convince shoppers to buy the company's apparel. And that is still to be determined. A lot of analysts who cover the stock say we don't really care that much about the noise. A lot of that is bringing new investors into the company. We're actually looking at the back to school season right now and seeing if people are actually going to start buying these jeans. So I'm very curious to see in a couple of months when you know, the financials come out if this did have any meaningful impact on the business.

[Neal Fryman]

So we'll see. Sydney Sweeney is a brand ambassador for at least a half a dozen brands. She is everywhere and we could look at some other brand deals that she's worked with to see if she does move the needle. It looks like in some cases perhaps she is a spokesperson for hey dude. Which is a loafer company owned by Crocs. In the latest earnings report, Cox CEO came out and said that the working with Sydney Sweeney to reach Gen Z consumers has been quote, performing really well. She also has worked with Dr. Squatch, which makes soap that was recently acquired by Unilever for $1.5 billion in June. Well, so it looks like she does push sales upwards in brands that she works with. We don't know yet whether that's happening with American Eagle. We do know that people are interested in American Eagle for perhaps the first time in a few decades. Google trend data shows that interest for American Eagle is at its highest level in more than 20 years. So people are searching for it. At least.

[Toby Howell]

A lot of fashion talk on this show. We're going back to 2018 with outdoor voices. Even further with American Eagle. We'll see how you know, our fashion takes age as we progress in the year. Up next, it's Tuesday, which means we have Toby's trends.

[Neal Fryman]

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[Toby Howell]

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[Neal Fryman]

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[Toby Howell]

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[Toby Howell]

Welcome back to another edition of Toby's Trends, the segment where I splunk deep into the Internet to emerge with a trend you should keep your eye on. And today's trend is restaurants going all in on spicy foods. Restaurant trains have been tripling down on hot foods that younger customers love. Chipotle rolled out its spicy Adobo Ranch last quarter and made Taco Bell debuted its Mike's Hot Honey Diablo Sauce on the heels of launching its Caliente Catena chicken menu the month before. Not to be left behind, Wendy's release a Takis Fuego meal, while the usually mild Mediterranean chain Cava launched a hot harissa pita chips in April. In total, US restaurant chains launched 76 new spicy menu items from March to June, bringing the total number of restaurants that offer at least one spicy item on their menu to 95%, according to an analysis by Data Central. Of course, spicy foods aren't new, but they are particularly popular with eaters under the age of 30 who prefer bolder flavors. A study from Sprite, who itself has been trying to emphasize its own tangy mouthfeel found that nearly 50% of Gen Z consumers eat at least one spicy meal a week. In general, Datacentral found that mentions the word spicy online tend to spike too when new spicy items are introduced to menus. So Neil, if you want to create buzz both online and in customers mouths, the best way to make that new hot food item is to make that food item hot.

[Neal Fryman]

We're all just trying to feel something, Toby. One reason why restaurants are leaning into this trend so much and one reason why they are so happy that consumers want spicy food is that it's pretty easy to make and it offers a low cost, high return option. Imagine if Gen Z consumers were like, we love lamb and goat. And they're like, well, we don't really have the supply chain to get all these new proteins in our menus. But to make a spicy food all you need is some peppers and maybe some creativity in the kitchen. So they are loving this and they are going all in on spicy, at least for the time being. We know that Gen Z consumers are pretty mercurial and they change their taste very quickly. Sweet and spicy was big, Spicy was big last year. Nashville hot was big a few years ago. Now you don't see any of those on menus. So Gen Z is, you know, quick to change their tastes. So we'll see how long this spicy trend lasts. But at least for now, restaurants are trying to cash in.

[Toby Howell]

I do think that this does have a compelling case for enduring because of social media. Spicy foods and social media go together extremely well because there's something about watching people suffer or you know, just have that really red mouth while they're eating a ghost pepper chip or something like that. There is something inherently compelling about watching that sort of entertainment. And the other aspect too is mukbangs have have produced a lot of viral spicy items. These are these live stream broadcasts of people just eating very large amounts of food. And large amounts of spicy foods are often more compelling than and more stark and red than watching someone eat, you know, pudding or something like that. So I do think the fact that companies want to make a buzz on social media, people who are scrolling social media want to watch people eating spicy things. That's a match made in heaven. And it's going to continue to, you know, power this hype in spice cycle.

[Neal Fryman]

I want to get your take on this one final spicy release. So Doritos thinks it has a new cool ranch level flavor, one of its mega flavors that it's coming out with that will have the popularity it's calling it Golden Srira Sriracha, which plays on this trend.

[Toby Howell]

Golden Sriracha. I do like, I don't understand the golden aspect. Maybe it's just because you can see it better. But I do love the idea of golden sriracha. Oh, you got to separate it from the normal cheesy color of Doritos. So golden Sriracha. I'm all in on that.

[Neal Fryman]

Yeah. They say that younger consumers like use sriracha as much as ketchup. All right, let's sprint to the finish with some final headlines. Boeing's impressive turnaround has hit a roadblock. 3,200 machinists building fighter jets in the St. Louis area went on strike yesterday after rejecting a four year contract with the company. The strike is the second walkout in less than a year for Boeing after 33,000 workers in the Northwest hit the picket line for seven weeks. CEO Kelly Ortberg, the mastermind behind Boeing's improving finances, downplayed the impact, telling investors last week, I wouldn't worry too much about the implications of the strike. We'll manage our way through that. But the striking workers are hoping to make him sweat.

[Toby Howell]

Yeah, Boeing does have a little leverage in this situation though, because it operates non union plants in the area as well. So again, the general manager of the St. Louis site said we are prepared for a strike and we have fully implemented our contingency plan to ensure our non striking workforce can continue supporting our customers. So this is much different than the much larger machinist strike earlier in the year or last year. Excuse me. This is a smaller part of their business. It's still a meaningful part of their business. It's still a part of their business has actually lost a lot of money of late. It's lost nearly $11 billion dating back to 2021. But it has made some strides. It was on pace to be profitable again this year, but now you throw a strike into the mix. Not as bad again as the big one from a few months ago, but still kind of annoying if you are bowling. Palantir was the best performing stock in the S&P 500 last year, gaining over 500%. And this year it's also the best performing stock in the S&P 500 and just had an earnings report where it topped Wall Street's already sky high expectations. The AI and defense software provider passed $1 billion in quarterly revenue for the first time ever and boosted its full year guidance. Its CEO Alex Karp was nearly giddy with the results. In a letter to shareholders, he wrote the Skeptics are admittedly fewer now, having been defanged and bent into a kind of submission. He also kicked off the earnings call yesterday by saying, as usual, I've been cautioned to be a little modest about our bombastic numbers, but there's no authentic way to have anything other than enormous pride and gratefulness for these extraordinary figures. A big reason for his optimism is Uncle Sam's checkbook. Palantir's US government revenues were up to 53% from a year ago. Neil Palantir is on an insane run right now and is now One of the 20 most valuable public companies in the U.S. after another 4% gain yesterday.

[Neal Fryman]

This guy is going full Mohammed Ali. I mean, he is riding high. And another thing that he said in Alex Karp said in the earnings call that I thought was interesting points to a grower. A broader trend here is, he said, we're planning to grow revenue while decreasing our number of people. So he said the goal is to get 10x revenue and have 3,600 people working for Palantir. We now have 4,100. There's been certainly a growing movement of CEOs being unabashedly telling investors that we want to reduce our headcount. Years ago, for entire corporate history, more people meant bigger company. And now with AI and other software coming into play, coming into the workforce and streaming, streamlining operations, you can do more with less. And companies like Palantir are just openly bragging about that. Now.

[Toby Howell]

Moving on. My name is Toby, but switch a letter and you get Joby, an electric air taxi company that is making big moves. Yesterday, Joby announced plans to buy out a portion of Blade's business, the helicopter taxi service, for $125 million. Blade made a name for itself by allowing people to LARP as big shots taking short distance helicopter rides to and from mainly airports in New York and Southern Europe. It's those short distance routes that Joby has its eyes on. Its flying taxis are designed to hold up to four people plus a pilot and fly around 100 miles before stopping for a recharge. For a long time, its air taxis have felt more like a pipe dream than a real mobility solution. But when you share three letters of a name with me, anything is possible. And thanks to an executive order signed in June aimed at accelerating the use of air taxis, it looks like it might have its regulatory certification ducks in a row, sooner rather than later. Neil. Both Blade and Joby are publicly listed companies and both sell their stocks jump about 18% yesterday. Maybe next time you fly out of JFK, you'll be riding in a Toby. I mean a Joby.

[Neal Fryman]

You tried to make it happen. I appreciate that. Yeah, it's very odd to see both companies stocks surge so much like that. After an M and a deal, usually the acquiree is the stock shoots up and the company that's doing the buying goes down. But clearly investors think this is a great move for both companies as we perhaps get electric air taxis coming. I know we've been, we've been promised this for years. One potential benefit for consumers for this particular deal is that Blade CEO said that pricing could go down as they use Joby's electric air taxis. Right now he says they cost as much as an Uber black service, which I'm going to have to take his word on because I've never actually tried to book one of these Blades. And he said now with, with these air taxis they're cheaper to maintain and you know, repair. So he's going to, he says it's not just for the few, it will be for the many.

[Toby Howell]

And I do need to call out something about Blade's business that is just a very unique part of, you know, business law. It reported $250 million in revenue last year, but nearly 60% came from its Oregon transportation business. This is a business that it kind of stumbled into when you are talking about short term flights and short term routes. A great use case of that is transporting a live organ on ice from one hospital to another. So it didn't necessarily set out to be an organ transport business, but it's only spinning off its passenger transportation business. It's keeping this Oregon transport business as a separate thing altogether because it's just been so lucrative and so successful. So next time you're in a Blade or something like that or you're doing a short term flight, maybe a heart or maybe a liver or something has been in that before you. So just a fascinating wrinkle and a fascinating part of Blade's business lore.

[Neal Fryman]

The Los Angeles newspaper landscape is about to get a lot more rude and a lot more punny. The New York Post Media Group said it will launch an L A based paper called the California Post early next year, bringing its loudmouth headlines and celebrity gossip to the entertainment capital of the world.

[Toby Howell]

World.

[Neal Fryman]

It's easy to see why Rupert Murdoch's News Corp. Which owns the Post, thinks going Hollywood is low hanging organic fruit. Already 90% of the new York Post digital readership lives outside of the Big Apple. With Los Angeles home to the second largest concentration of readers. Meanwhile, the L A newspaper scene has been gutted by layoffs, leaving a void the Post is happy to fill with its brash tone. And I can't believe they went there. Covers California, Here they come.

[Toby Howell]

I weirdly don't hate this idea on a number of levels because you're right. A lot of viable news options in L A have been disappearing recently. The L A Times recently cut 115 staffers in January. That was just a few months after it laid off 74 more people. The L A weekly magazine in the area also just lost a lot of its senior staffers. So there is a news dearth in that area right now. And the New York Post, against all odds, has been a profitable business for the past three years, even though it's mainly a, you know, it's still a print business because it's just. It zagged while a lot of other people have zagged. Its approaches to covering certain issues is much different than other news organizations out there. And it doesn't seem to make sense in New York. I mean, it has more of a conservative lean and New York is a very progressive place, and yet somehow it's still remained profitable in the city. So L A is another kind of location where it would have to do that seemingly counterintuitive bedfellow for the audience it's serving, but excited to see it also cover AI and cover technology and cover entertainment in its New York Post style of headlines. So definitely, like, not something that seems to make sense on paper, but I'm curious to see how it actually plays out in practice.

[Neal Fryman]

All right, that is all the time we have. Thanks so much for starting your morning with us. Have a wonderful Tuesday. If you have any thoughts or feedback on today's show, send a note to Morning Brew daily at Morning Broadcom. And before I thank our team, Toby needs to get something off of his chest.

[Toby Howell]

Yes, it is my fiance's birthday today, as I'm so fond of saying. So everyone, please wish Celia a happy birthday.

[Neal Fryman]

Let's roll the credits. Emily Milian is our executive producer. Raymond Lu is our producer. Our associate producers are Olivia Graham and Olivia Lake. Hair Makeup is doing things. Devin Emery is our president and our show is a production of Morning Brew.

[Toby Howell]

Great show, Danielle. Let's run it back tomorrow.

[Neal Fryman]

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[Toby Howell]

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[Neal Fryman]

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[Toby Howell]

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