Neal Freyman (2:31)

I don't know, but I know who is the sponsor of this episode. It's On Investing, an original podcast from Charles Schwab. Each week, host Liz Ann Saunders, Schwab's chief investment strategist, and Colin Martin, head of fixed income research and strategy for the Schwab center for Financial Research, bring you fresh insights into what's happening in the markets and why and what the implications might be for your portfolio.

Toby Howell (2:50)

Join Colin and Liz Ann as they explore questions like how do you evaluate corporate bonds that look interesting? And what sectors are on the move right now? You can download the latest episode of On Investing and subscribe so you never miss an episode@schwab.com on investing or wherever you get your podcasts. There's one less cook in the Kitchen in Cupertino Tim Cook is stepping down as CEO of Apple, handing over the reins to longtime hardware boss John Ternus on September 1st. The company announced yesterday it ends a 15 year tenure at Apple that took the company from a market cap of under $400 billion to over 4 trillion. During that decade and a half, Cook brought the Mac and iPhone to new heights, oversaw the launch of AirPods and Apple Watch, turned Apple's supply chain into the envy of the world, and juiced the heck out of its services businesses like music and TV to make it one of the biggest units in the company. It has been the greatest privilege of my life to be CEO of Apple, cook said in a statement. I love Apple with all my being who is in the on deck circle. Ternus is Apple's head of hardware engineering and has spent the last 25 years in product development. His appointment is no surprise. He's long been rumored to be the golden boy to take over after Cook after becoming the youngest member of Apple's executive team back in 2021. He looks like the man for the moment too, with Bloomberg reporting he's a strong believer in AI, a necessary bent after multiple stumbles from Tim Cook to integrate the tech. But turn this comes with a few question marks and challenges to Apple hasn't launched a truly new product category in years under his direction. And though Apple is in a good place, it still hasn't put forth a coherent AI strategy either. Neil Steve Jobs left big shoes for Cook to fill. Now you can argue Cook's leaving even bigger ones for John Ternus.

Neal Freyman (4:38)

Yeah, let's take a look at his resume. So I went to his LinkedIn education, University of Pennsylvania Bachelor of Science in Engineering, Mechanical Engineering, 1993-1997. And then he went to work as an engineer for virtual research, July 1997 to June 2001. There's only one other thing on his LinkedIn. It's Vice President Hardware Engineering at Apple. July 2001 to present, 24 years and 10 months. We'll have to update that with the CEO. So he has been at Apple nearly half of his life. The general reaction to this, it's like a screen pass on third and 10, going to Florida on vacation. It's not going to blow your socks off, but you know it'll be effective and won't rock the boat. If you look at the Apple's past three CEOs, Steve Jobs was the product innovator, Tip Cook was the guy who knew the nuts and bolts of the supply chain and Turnus is the engineer. He likes to get in the nitty gritty of these products themselves and bring them to market.

Toby Howell (5:32)

Yeah, the biggest thing that people credit Turnus with doing is reversing a decline in product quality at Apple. He basically stepped in and as you mentioned, just was a detail guy brought it. I mean when Tim Cook took over, the iPhone 4 was out. Now we are at the iPhone 17. And all of those have been launched under the watchful eye of John Attorneys. Just small things like battery life, performance, the fact that Apple moved into their own chips, these are all things that have happened under his tenure. There is some case against him though, and some stumbles that have happened under his watchful eye. I mentioned the new product category thing. Turnus is not actually a big fan of launching new products. He was not a fan of dallying with the Apple car that never came to be. He wasn't a fan of the Vision Pro bad either. He wasn't even a big fan of the smart home speaker kind of category when that first launched back with Amazon a few years ago. He also was a big fan of things like the touch bar and the butterfly keyboard, which have been two of the more annoying product innovations under Apple. So he, he's not just some savant when it comes to creating new product categories. He still has his stumbles here and there, but by all, by all accounts he is a details guy and a good engineer.

Neal Freyman (6:53)

Yeah. So let's look at what is on the to do list for him. He's managing a $4 trillion company. So number one is manage the AI transition. AI has the potential to blow everything that Apple has been doing for the past couple of decades up and is going to potentially revolutionize the tech sector. It's already doing it. You know, the tech companies that Apple was contending with a few decades ago when Tim Cook started is not the same cohort that their rivals are today. OpenAI anthropic Google has a big AI program as well. Apple seems to be lagging behind those competitors when it comes to AI. And if AI is the next big thing, it needs to figure its stuff out. Number two, develop bolder products. What is the next big thing? That is something that may have perhaps languished that bold innovation under Tim Cook, whereas it flourished under Steve Jobs. We'll see if Turners can bring that back. And then the third one is manage the Trump relationship. I know it doesn't sound as sexy, but this is very important for a company like Apple that has production in places like China and India and all over the world, sells also to places all across the world, has retail stores across five continents. China is its second biggest market. So. So something that Tim Cook did that Steve Jobs never had to do was go to the White House, go to Xi Jinping in Beijing and, you know, massage those relationships with world leaders.

Toby Howell (8:10)

Let's give Tim Cook his flowers a little bit too, because he is stepping out after 15 years. Remember Tim Cook, not the visionary. We've said this multiple times at this point. He came after 12 years at IBM, so not necessarily known for its innovative culture, at least at this point in its lifespan. But he turned the supply chain around. It really is one of those things that Apple is when it went from a weakness to an absolute strength under Tim Cook. The fact that the services business is $100 billion a year business was not something that many people had on their bingo cards going forward because Apple was primarily a hardware company. He debuted the wearables category too. I mean, we say that he's not an innovator, but Apple Watch is now a de facto product category. It owns 25% of the smartwatch market. So that is absolutely thing that happened under Cook. AirPods is brings in more revenue per year than most physical Fortune 500 companies. So he certainly ushered in some product categories. Even if he's maybe not the charismatic Steve Jobs s type figure.

Neal Freyman (9:13)

I think the overarching legacy of Tim Cook will just be a very good financial steward. He made people a lot of money as CEO of Apple. He didn't maybe invent the iPhone or some of these, you know, these whiz bang products that Steve Jobs did, but he squeezed as much money as he possibly could out of them. And so that will maybe be what Tim Cooks is remembered for as just being a consistent leader. I mean, it's not it's hard to be a tech CEO for 15 years and change with the times. John Ternus will step into the hot seat on September 1st. Moving on. Don't you just hate it when you put a satellite into the wrong orbit? Happens to me all the time. And it happened to Blue Origin on Sunday. The rocket company founded by Jeff Bezos, who knows a thing or two about delivering things, delivered an AST Space mobile satellite into the wrong orbit. The direct to cell satellite was supposed to be plopped into orbit about 285 miles above the Earth at of 49 degrees to the equator. However, Blue Origin's New Glenn dropped it off at just 95 miles at its closest point, a much lower orbit than scheduled. AST said that this orbit was, quote, too low to sustain operations and it will deorbit the spacecraft and recover it under an insurance policy. The Blue Origin mishap is a reminder that for all the warm fuzzies Artemis II gave us, space remains very hard. It is not unusual for things like this to go wrong, especially for the new rocket the company was using, but it will have a number of ripple effects. One, the mistake won't help Blue Origin catch up to SpaceX, reliable and dominant force in the space launch industry. Plus it could have an impact on future Artemis missions. Remember, NASA is relying on SpaceX and Blue Origin to produce lunar landers that will take astronauts to the moon's surface in just two years. So any delay in Blue Origin's timeline will delay NASA's timeline to Toby. Certainly not a disaster, but a little embarrassing.

Toby Howell (10:58)

I mean, who among us hasn't prematurely released our payload into an inaccurate orbit at some point or another? I saw two different reactions on social media. One from the more zealous pro space crowd was that we should celebrate a successful reflight and landing of an orbital booster for Blue Origin. After all, there's only one company that is Space X that can do this. There's no companies outside the US that can reliably do this. So that's a check in the box of the space crowd for the more anti space crowd. Obviously they were dunking on it because the upper states did fail. Now I would point out that this is not just a Blue Origin problem. Space X also booed this this at one point and their livestand they deployed a satellite into the wrong orbit too. But that was back in 2012, which just shows how much of a head start it has when it comes to iterating on space.

Neal Freyman (11:47)

Yeah, let's talk about this Space X versus Blue Origin rivalry. I mean, it's kind of like Alabama playing Eastern Tennessee State. Like it is not close right now. Space X launched more than 160 times in 2025. Blue Origin launched twice. And then in terms of this satellite business, you know, SpaceX has 10,000 Star satellites up there floating around in orbit. And Amazon Leo has, you know, which is affiliated with Blue Origin a little bit, has just a couple hundred. So Space X is absolutely dominating this industry. And Blue Origin has this new rocket which this failed satellite went up on, which is new Glenn. And it's tempting to compete with the Falcon 9 booster. The Falcon 9 booster from SpaceX has just such a head start. It is the workhorse. It is so reliable, Space X can Recycle a Falcon 9 booster for reflight and in just nine days and it can launch this thing five or more times in one week. So this is just a science for SpaceX. And Blue Origin is still getting its space legs. Moving on. At a major cancer conference in San Diego yesterday, researchers presented what may end up being a watershed moment for pancreatic cancer treatment. Of the 16 patients who were given a personalized MRNA vaccine in 2020, eight showed a significant immune response and seven are alive today, six years after the trial began. If that doesn't sound like an incredible result, just remember that pancreatic cancer is one of the deadliest out there. Most patients live just a few months longer, While less than 13% of people live for more than five years after being diagnosed. And since there's no routine screening for pancreatic cancer, you can only really tell when symptoms show up, often at an advanced stage. The five year survival rate for stage four pancreatic cancer is 3%. The results are another very promising development for applying MRNA technology, which was harnessed by some drug makers to create effective Covid vaccines. In this case, Biontech and Genentech, the two companies behind the pancreatic cancer vaccine, use genetic material taken from individual tumors to create a unique vaccine personalized for each patient. Toby this is a very small trial, just 16 patients, so it's irresponsible to draw sweeping conclusions before more studies are done. Still, you got the sense from all the doctors chiming in on social media that there's loads of excitement about this treatment and MRNA vaccines in general.

Toby Howell (13:58)

Yeah, cancer vaccines are no doubt difficult to pull off because let's compare and contrast them to viral vaccines versus cancer vaccines. When you are Targeting a virus, your body recognize that it's a virus. They recognize it's a foreign pathogen. And it's much easier to teach your T cells and teach your immune system to attack that virus. Cancer, on the other hand, is derived from your own tissue. It is you. It's just a different type of. Of cell that is mutated. So it's a very much more difficult to crack the toughest cancers when it comes to MRNA vaccines. But the fact that we're using MRNA vaccines at all is a breakthrough in and of itself, because when looking at kind of super survivors when it comes to pancreatic cancer, they noticed that super survivors had about 12 times as many T cells. These are people that just survive beyond the normal timeline when it comes to cancer. The fact that they had all these T cells, though, were specific to them. They're not just T cells that you can put into anybody else's body. They were very much coded to their own DNA, which is why we are making these personalized vaccines, why they think that if you take the cancer out, kind of figure out a way to create a vaccine that targets directly the cancer within the body. That is a real breakthrough. So just a fascinating, you know, science experiment that had a lot of people, even on our timelines, kind of celebrating that this could be a big breakthrough.

Neal Freyman (15:21)

And we just talked about supply chain genius. The supply chain for this particular vaccine also is kind of blowing my mind. First when, when patients entered this trial, first they went into surgery, they had the tumor removed, and then the tumor was preserved and then sliced into pieces that are each thinner than a human hair. In less than 72 hours after the surgery, that was sent over to Germany, where Biontech is based. And they turned that those thin slices into a clear liquid, which is a personalized vaccine, and they ship it back to the United States to Moral Sloan Kettering, which turns it into. Which actually delivers the vaccine to the body. So this is a Cross Atlantic thing. And again, it's really small. Sixteen patients. Eight. Seven of them are still living. So exciting. But, you know, the doctor at Memorial Stone Kettering is going to do a much larger trial to see whether this is actually has legs.

Toby Howell (16:11)

All right, we're going to take a quick break and come back with Toby's trends right after this.

Neal Freyman (16:17)

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Toby Howell (16:19)

You know, I'm the real deal, Neil.

Neal Freyman (16:21)

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Toby Howell (16:34)

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Neal Freyman (16:42)

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Toby Howell (16:52)

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Neal Freyman (17:29)

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Toby Howell (17:31)

I think you mean phone a friend.

Neal Freyman (17:33)

Nope, I mean FL o w n

Toby Howell (17:35)

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Neal Freyman (17:42)

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Toby Howell (17:51)

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Neal Freyman (17:54)

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Toby Howell (18:06)

means it's time for Toby's Trends, where I take a deep dive into the Internet to emerge with a trend you should keep your eye on. And today's trend is a fashion trend because I know that's what you all come to Morning Brew daily to hear about. But this fashion trend has a business tie in Silicon Valley is in the middle of a CEO merch. Boom. A 28 year old software engineer the Wall Street Journal spoke to rolled up to Nvidia's annual conference in a $178 green sweater with a cartoon Jensen Huang on the front. Palantir sells a T shirt with the face of its CEO Alex Karp on the front. The defense tech firm Andrew also slings the flower print Hawaiian shirt its founder Palmer Lucky is synonymous with. So why is Silicon Valley, which is famous for shunning any sort of fashion sensibilities, embracing fashion statements? It's partly ironic. Putting CEO faces on clothes is kitschy but in such an overt way that it shows you're in on the joke. But there's also certainly an undertone of hero worship to Palantir is often compared to a cult. Given the mysterious and controversial nature of their business, slapping their CEO's face on a shirt just leans into that reputation. Neal. In general, CEOs are becoming important cogs in the content machine. From viral merch to viral burger taste testing videos, their faces and Personas are becoming more public than ever. So I'm getting you a shirt with my face on it asap.

Neal Freyman (19:27)

All right, well, I'll keep it in my closet until you become a CEO. Then I promise I will wear it. Why does this happen only in the tech industry? I mean, hardly any people can identify the CEOs of any other company outside of tech and let alone wear their faces. Is it just because they're so derpy? Is that why the tech. The tech CEOs as becomes a quote unquote fashion statement for their employees?

Toby Howell (19:48)

Yeah, it definitely is. Leaning into this, like, rebellious bro vibe. There's a lot of the rise of like, the tech bro CEO has become something that we've talked about a lot of late. I mean, Zuck has totally rebranded himself. He wears a different chain now. He has a little bit more fashion sense himself. And there is, there's actually like two vectors I want to talk about here. There is the ironic one where you put the face of the tech SEO on your shirt. But there's also like Jensen huang wears a $9,000 leather jacket and is sort of making a iconic fashion statement when he wears that. So there's two sides of it here. Zuck has also like, become a lot more fastball. Like many people have talked about that. So definitely there's the ironic side, but there's also the non ironic side of maybe they are taking more care when they're presenting themselves to the public.

Neal Freyman (20:35)

And there's no question that. I know, I know I said a lot of the other CEOs in other industries were more anonymous, but there's no, no doubt that they're becoming more visible. And one example is the Burger King president, Tom Curtis. Now, he's been everywhere when they revamped their whopper, revamped their fries, redid their menu, redid things about their store. I mean, he was the star on a 90 second commercial. He gave out his cell phone number and received 41,000 voicemail messages, which they extended into a social media campaign. So he became the face of Burger King. People could put a face to the actual company. And you know, literally the mascot got kicked aside for the CEO. So I think a lot of PR teams and communications professionals are really debating how much to put the CEO out there now. I mean, if you're a tech company, it seems like it's a no brainer too because you really develop a cult of personality there. But just for more regular consumer companies, I think they're seeing more success with having the CEO be the face of the company.

Toby Howell (21:33)

I mean, you can't talk about CEOs on social media without talking about Chris Kopensky, McDonald CEO and that viral video where he took a very small bite of the Big Arch Burger. I will say though, that McDonald's spokesperson has said early sales of the Big Archburger were beating expectations. So maybe all the hoopla around how awkward he looked on camera actually did translate into some sort of sales booth for that product.

Neal Freyman (21:56)

Yeah, I guess the going convention for trotting your CEO out is maybe don't do it until there's a crisis and then you show you have like a steady hand on the wheel. That seems to be don't put him out there for just anything willy nilly. Because like the McDonald's CEO showed these people are not great at social media, so maybe don't have them be out there all the time. But if when there's a crisis, like maybe what happened with Burger King, then that's the time to strategy, strategically deploy them to the masses. Okay, let's sprint to the finish with some final headlines. FBI Director Cash Patel sued the Atlantic and reporter Sarah Fitzpatrick for $250 million, alleging defamation for her recent article that described Patel as having a drinking problem that could imperil national security. In the complaint, Patel claimed the Atlantic crossed the legal line by publishing a piece, quote, replete with false and obviously fabricated allegations designed to destroy Director Patel's reputation and drive him from office. In the article, Fitzpatrick cited more than two dozen anonymous sources who mentioned Patel's, quote, conspicuous inebriation and unexplained absences, including that the FBI had to reschedule early meetings because of his alcohol fueled nights when the piece was published. The government denied the allegations and seemingly previewing this lawsuit. Patel said in a statement, print it all false. I'll see you in court. Bring your checkbook. The Atlantic says it stands by its reporting.

Toby Howell (23:14)

Yeah, this is not a first by any stress. The Trump administration has sued a lot of media outlets. Most recently a judge actually dismissed a lawsuit from Trump. $10 billion defamation suit against Wall Street Journal over an article about his ties to Jeffrey Epstein. It does feel a little Streisand effect. We were remarking before the show that we probably or the masses wouldn't have known about this Atlantic piece. Unless you sue it for 200.

Neal Freyman (23:38)

We certainly wouldn't have talked about it on this show.

Toby Howell (23:40)

It is the MVD slash strikes in effect, the fact that we're even discussing it at all Jersey Mike's Is Going Public the sandwich chain filed for a confidential IPO yesterday, just months after Blackstone scooped it up for $8 billion early last year. The asset manager is shooting to bring the sandwich chain public at a valuation of around $12 billion for a tidy $4 billion markup in about a year. Founder Peter Cancro bought the original Jersey Mike sub shop in Point Pleasant, New Jersey in five at just 17 years old, he spent the next 50 years turning it into a mega chain with 3,300 locations and by far the fastest growing sandwich business in the country. In terms of unit count, Jersey Mike's is the third largest sandwich chain in America. Even more impressive, same store sales have been positive for 20 straight years and they're still expanding. A January deal will bring 400 Jersey Mike's to the UK and Ireland, which means somewhere in Liverpool right now a Scouser is about to discover what a Club supreme ad banana peppers make It Mike's way tastes like.

Neal Freyman (24:41)

I just hope Danny DeVito gets some of the proceeds from this IPO. I think he's responsible for most of the growth of Jersey Mike's, but it is growing like a weed opening, you know, 300 stores on average every year. They're going to be on every street corner before you know it. Finally, imagine a world where you don't have to make a pit stop every time you need to pee on a road trip. A Chinese carmaker series has been granted a patent for an in vehicle toilet, the BBC reported. The contraption is hidden under the passenger seat until you need to go when it slides out with a push or a voice activated command to not make a huge stink. The toilet comes with a fan and exhaust pipe to filter out the smells, but it doesn't get rid of the waste itself. You have to empty the tank manually. Toby I prefer an empty water bottle when things get desperate, but this works too.

Toby Howell (25:24)

I mean I follow this account Ramp Capital on X and he said bring this to every sports stadium in the country immediately. You'd never miss another moment. I say bring it to the podcast studio as well. I feel like the big key here though is ventilation they say they have the ventilation system, but what if that backs up? Remember it happened on the recent, you know, mission to the moon. That is just a miserable choice. Whatever time you save from not just pulling over and go to the bathroom. I don't know if it's worth it for having, you know, a dookie sitting in your chair while you're doing a long haul drive. It's absolutely ridiculous.

Neal Freyman (25:58)

All right, that is all the time we have. Thanks for starting your morning with us and have a wonderful Tuesday. Okay, Toby, I mean, think about this. All show. Repeat the question. The Jeopardy Question or the Jeopardy. Answer, and we have to figure out the question. Can you repeat it?

Toby Howell (26:10)

Okay, the clue was Mark Twain wrote the quip that on this day of the year, we are reminded of what we are on the other 364.

Neal Freyman (26:19)

Okay, can you give me the month?

Toby Howell (26:21)

Say if I give you the months? It definitely gives you a hint, but I'll do it. April.

Neal Freyman (26:25)

April. What is an April?

Toby Howell (26:28)

Blank Fools. April Fool's Day. So he's basically saying that we're reminded that we're fools on the other 364 days of the year. Well, don't be mad that you didn't get it wrong. Ding Got it wrong too. So you guys are at the same level of Jeopardy Goat status.

Neal Freyman (26:42)

Well, yeah, we are about the same. I just didn't know April Fool's extended back into the 19th century.

Toby Howell (26:47)

Mark Twain might have just invented it. Don't quote me on that either. I have no idea if that is true.

Neal Freyman (26:52)

All right, if you'd like to reach us, send an email to Morning Brew daily at Morning Broadcom or DM us on Instagram at the Daily Show. Let's roll the credits. Emily Milliron is our supervising producer. Raymond Liu is our senior producer. Our producer is Olivia Graham, and our associate producer is Olivia Lake. Hair and makeup is always floating in the wrong orbit. Devin Emery is our president and our show is a production of Morning Brew.

Toby Howell (27:12)

Great show, Danielle. Let's run it back tomorrow. Footing off, replacing your window treatments because you think it's complicated. At blinds.com, we've spent 30 years proving it doesn't have to be. And today is your last chance to save big on spring Black Friday deals. Whether you want to DIY it or have a pro to handle everything from measure to install, we've got you free samples, real design experts, and zero pressure. Just help when you need it. Shop up to 45% off with minimum purchase. Plus get a free professional measure during the blinds.com spring Black Friday Last chance Sale rules and restrictions apply.