Walmart Warns of Slow Sales in 2025 & Amazon Takes Over James Bond

Summary

Morning Brew Daily Podcast Summary Episode: Walmart Warns of Slow Sales in 2025 & Amazon Takes Over James Bond
Release Date: February 21, 2025
Hosts: Toby Howell and Kyle Hagee

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1. Walmart’s Q4 Performance and Future Outlook

Walmart, a leading giant in the retail industry, released its fourth-quarter earnings, which initially appeared strong with a 4.6% year-over-year sales increase, surpassing expectations. Notably, e-commerce sales surged by 20%, and higher-income shoppers contributed significantly to the uptick. Despite these positive numbers, Walmart cautioned about potential challenges ahead, projecting 3-4% full-year sales growth for 2025, which is below Wall Street’s forecasts and a decline from the 5.1% growth seen the previous year.

“Sales were up 4.6% year over year, topping expectations,” said Toby Howell at [04:03].

The company cited tariffs and persistent inflation as key factors that could hinder sales and profit growth. CFO John David Rainey highlighted that while approximately two-thirds of Walmart’s products are domestically sourced, complexities with products imported from Mexico and Canada introduce tariff-related uncertainties.

“Are things going to get even harder if tariffs come to play?” Kyle Hagee pondered at [04:40].

Walmart’s diversified revenue streams—ranging from Walmart Plus and Sam's Club memberships to its advertising division, Walmart Connect, and expanding e-commerce—mirror Amazon’s business model, signaling a strategic shift towards a more integrated retail ecosystem.

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2. Amazon’s Acquisition of James Bond Franchise

In a significant development, Amazon has secured a joint venture with the Broccoli family (long-time stewards of the James Bond franchise) to gain creative control over the iconic James Bond IP. This move follows Amazon's acquisition of MGM Studios, which brought the Bond franchise under its umbrella. Historically, the Broccoli family maintained stringent control over Bond, overseeing every aspect from casting to stunt sequences.

“Amazon and the Broccoli family have formed a new joint venture to house Bond IP with Amazon MGM Studios gaining creative control,” Toby Howell announced at [05:54].

The agreement is a game-changer, enabling Amazon to leverage Bond as a flagship asset within its expanding media empire. Despite past tensions—where the Broccoli family criticized Amazon for referring to Bond as “content”—the new deal signifies a shift in power dynamics.

“Barbara Broccoli... said, 'Don't have temporary people make permanent,'” Kyle Hagee recounted at [10:38].

Amazon envisions utilizing the Bond franchise across various platforms, potentially introducing new films and television spin-offs that align with its Prime Video offerings. The acquisition not only enhances Amazon's content library but also positions it as a formidable competitor in the entertainment industry.

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3. Introduction of Protector: The Armed Ride-Sharing App

A novel entrant in the ride-sharing market, Protector, launched this week offering on-demand armed security guards alongside transportation services. Currently available in New York and Los Angeles, the app facilitates rides in upscale vehicles such as Escalades, with security provided by active or retired law enforcement officers.

“Protector lets you hire on-demand personal armed security guards to give you both a lift and watch your six,” Toby Howell explained at [11:51].

With pricing starting at $200 per hour (minimum five-hour booking) and an additional annual membership fee of $129, Protector targets individuals seeking enhanced personal safety. While Kyle Hagee expressed skepticism about the app's long-term viability, labeling it as potentially appealing to those interested in cosplaying as billionaires, the company cites growing safety concerns as a driving factor behind its launch.

“They struck a chord... They've done their job on the marketing front,” Kyle noted at [13:31].

Interestingly, Protector’s founder, Nick Sarath, also developed Patrol, an app enabling neighborhoods to crowdfund for increased security measures, including the deployment of drones. This expansion indicates a trend towards augmented personal and communal security solutions in response to rising safety apprehensions.

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4. Stock and Dog of the Week

Stock of the Week: Hims and Hers Health (HIMS)

Hims and Hers Health emerged as the Stock of the Week, experiencing a remarkable 141% surge in 2025. The company gained substantial traction following a Super Bowl advertisement, resulting in a 650% spike in website visits and significant growth in user registrations and app rankings.

“HIMS stock has had a massive gain on the news that the company has now acquired Tribi Labs,” Kyle Hagee highlighted at [17:00].

The acquisition of Tribi Labs enables Hims and Hers to offer at-home blood draws and comprehensive pre-treatment testing, enhancing its telehealth services. Dr. Carroll, Chief Medical Officer, stated, “At home lab testing is one of the most exciting steps towards elevating the personal comprehensive care customers in this country should expect,” at [17:10].

This strategic expansion into personalized medicine and AI-driven health management positions Hims and Hers as a formidable player in the health and wellness sector, garnering enthusiastic support from Wall Street.

Dog of the Week: Palantir Technologies (PLTR)

Transitioning to the Dog of the Week, Palantir Technologies faced a challenging week, with its stock dropping over 10% amid announcements of an 8% annual cut in the Pentagon’s defense budget. As a company heavily reliant on government contracts, these budgetary cuts pose significant concerns.

“Palantir is a company that relies so much on government contracts for over half of its revenue,” Toby Howell commented at [20:00].

Additionally, CEO Alex Karp’s new stock compensation plan, allowing the sale of nearly 10 million shares within six months, further unsettled investors. Despite these setbacks, some analysts, including Kyle Hagee, believe Palantir is well-positioned to navigate budget cuts due to its innovative approach and strategic connections within the tech and defense sectors.

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5. Additional Headlines

IRS Workforce Reduction

The IRS initiated significant layoffs, reducing its workforce by approximately 6,700 employees—over 6% of its total staff—as of February 21, 2025. These cuts primarily affected newer employees with less than two years of service. Despite tax season ramping up, essential roles remain unaffected. However, with 63% of current IRS employees eligible for retirement within six years, the agency faces ongoing challenges in maintaining its operational capacity.

“These layoffs come right as tax filing season is picking up in earnest,” Kyle Hagee noted at [24:37].

Four Nations Hockey Tournament Heats Up

The Four Nations Hockey Tournament featuring Sweden, Finland, Canada, and the U.S. ignited intense rivalries both on and off the ice. The U.S. team suffered a narrow defeat against Canada with a 3-2 score, leading to heightened tensions and social media buzz. Ticket prices soared, with the cheapest available at $1,200, reflecting the event's immense popularity and the burgeoning trend of in-season NHL tournaments.

“Canadian Prime Minister Justin Trudeau fired back, saying, 'You can’t take our country and you can’t take our game,'” Toby Howell reported at [26:15].

Discovery of Pharaoh Thutmose II’s Tomb

In a groundbreaking archaeological achievement, Egyptologists unveiled the tomb of King Thutmose II, marking the first royal tomb discovery since King Tut’s over a century-old find. Initially mistaken for the tomb of a queen due to its location beneath two waterfalls and subsequent water damage, the tomb’s opulent decorations clearly identified it as the resting place of a pharaoh. This discovery underscores the enduring mysteries yet to be unearthed in Egypt’s rich historical landscape.

“It's cool that we still are finding these things,” Kyle Hagee expressed at [28:00].

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Conclusion

The episode of Morning Brew Daily navigated through significant developments in retail, entertainment, technology, and more. From Walmart’s cautious outlook and Amazon’s strategic acquisition of James Bond, to the emergence of Protector’s armed ride-sharing service and dynamic stock movements with Hims and Hers and Palantir, the hosts provided insightful analysis on current market trends and emerging technologies. Additionally, headlines covering IRS layoffs, the Four Nations Hockey Tournament, and the discovery of an ancient tomb added diverse perspectives to the day's discussions.

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Notable Quotes:

• “Sales were up 4.6% year over year, topping expectations,” — Toby Howell [04:03]
• “Are things going to get even harder if tariffs come to play?” — Kyle Hagee [04:40]
• “Amazon and the Broccoli family have formed a new joint venture to house Bond IP with Amazon MGM Studios gaining creative control,” — Toby Howell [05:54]
• “We have accelerated,” — Kyle Hagee [07:15]
• “Protector lets you hire on-demand personal armed security guards to give you both a lift and watch your six,” — Toby Howell [11:51]
• “HIMS stock has had a massive gain on the news that the company has now acquired Tribi Labs,” — Kyle Hagee [17:00]
• “At home lab testing is one of the most exciting steps towards elevating the personal comprehensive care customers in this country should expect,” — Dr. Carroll, Hims and Hers [17:10]
• “Don’t have temporary people make permanent,” — Barbara Broccoli [10:38]
• “They struck a chord... They've done their job on the marketing front,” — Kyle Hagee [13:31]
• “It's cool that we still are finding these things,” — Kyle Hagee [28:00]

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This summary encapsulates the key discussions, insights, and conclusions from the Morning Brew Daily episode, providing a comprehensive overview for those who haven’t listened to the podcast.

Transcript

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[Kyle Hagee]

Will that be cash or credit?

[Toby Howell]

Credit.

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[Toby Howell]

Good morning, Brew Daily Show. I'm Toby Howell.

[Kyle Hagee]

And I'm Kyle Hagee.

[Toby Howell]

Today, Walmart, the bellwether of retail, warns there could be tough times ahead and.

[Kyle Hagee]

How Amazon has finally got James Bond over to their side. It's Friday, February 21st. Let's ride.

[Toby Howell]

So as you can hear, Neil is out for the day and actually will be out for the entire next week as well as he is finally taking a long deserved break. Which means we have Kyle here today.

[Kyle Hagee]

Thank God. Neil deserves a break.

[Toby Howell]

He absolutely does. So Kyle, you are from Minnesota, which along with the whole Midwest has been in the midst of a little bit of a cold snap. In fact, it was so cold this week that cloud detecting satellites pointed at the region thought that all of Minnesota, the Dakotas and part of Wisconsin were a cloud. The National Weather Service shared this gif of satellite imagery showing dark and light blue covering the upper Midwest. The hallmarks of clouds as seen by satellites, while actual clouds floated by over Illinois. In Iowa, Kyle, there is cold and then there is satellites mistaking your state for a cloud cold. What is going on?

[Kyle Hagee]

Well, first I just want to say I'm honored to be the MBD Minnesota correspondent first. That is an honor. No, that's just another day in Minnesota. Parents still have shorts on the walk outside they go, oh, it's a bit chilly. That, let's get on our way and you go on with your day.

[Toby Howell]

You go on with your day. Now let's go on with our show. A word from our sponsor, LinkedIn Ads. Kyle, thank you again for filling in today.

[Kyle Hagee]

My pleasure, Toby. It was fun getting back into MBD prep last night. Felt like I was back in school again.

[Toby Howell]

Preparation is a huge part of what makes me tick. But now imagine that you are in that chair in front of the bright lights with no idea with what we were talking about today. Just fully in the dark.

[Kyle Hagee]

As much as I trust my improv skills, that sounds awful. I would much rather know what the heck is going on.

[Toby Howell]

I agree, but so many people run their B2B ad campaigns that way. No prep firing willy nilly hoping they reach the right people.

[Kyle Hagee]

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[Toby Howell]

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[Kyle Hagee]

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[Toby Howell]

Wal Mart released its fourth quarter earnings yesterday and spooked the markets a little bit after it warned inflation fatigue and general uneasiness among shoppers could slow its roll over the next year. And since it's Walmart and it's huge, its tepid outlook stoked fears of a broader slump in consumer spending that affected the entire market. Q4 earnings actually weren't the issue. Sales were up 4.6% year over year, topping expectations. E Commerce sales especially were a bright spot, jumping 20% and higher income shoppers kept piling items into its shopping carts. So why was the stock down 6% yesterday? A cleanup on aisle 2025 it projects 3 to 4% full year sales growth below Wall Street's expectations and well under the 5.1% growth it logged last year. Called out tariffs, which could weigh on the low prices as well as lingering inflation as two reasons why sales and profit growth could slow. Kyle, Combine Wal Mart's tepid outlook with the fact that US Retail sales fell more than expected in January and you have a rocky start to the year for consumer spending.

[Kyle Hagee]

Yeah Toby, you mentioned this at the beginning of the show. This is like a bellwether for retailers. I mean Walmart is just so massive that how Walmart goes kind of the whole industry goes. I thought the tariffs were very interesting. They're CFO John David Rainey said look, we're not immune from tariffs. I think it's about 2/3 of what Walmart sells is made, is grown or assembled in the U.S. but they still have products coming in from Mexico, from Canada. The tariff situation seems pretty unclear. So they didn't actually talk about that in their guidance. But that is kind of the big cloud over all of this is are things going to get even harder if tariffs come to play?

[Toby Howell]

Right. And Walmart is typically pretty insulated from tariffs, not only because a lot of what they, you know, source is from the United States. But also they are so big that they have really great leverage when negotiating with partners. And so usually they can skate by without having to raise prices too much. But you're right, there is just this cloud of uncertainty hanging over it right now. That being said to Walmart did have a pretty dang good quarter outside of, you know, kind of this uncertainty that they're seeing ahead. Like they have diversified their business a little bit. Their ad business brought in over 4, 4 billion dollars last year. You don't think of Wal Mart even having an ad business, but E commerce is growing as well. So Q4 was great. But looking ahead is where it gets a little murky.

[Kyle Hagee]

Yeah, I think this point about the diversification of Walmart's revenue stream is actually really interesting. Global membership from Walmart, their income grew 16% year over year. That's programs like Walmart plus Sam's Club. Their advertising business as you mentioned was near about 30%, 24% increase in Walmart Connect. They have these third party marketplaces now. They're doing pharmacy, they're doing same day delivery. So they've really diversified and they're kind of becoming a little bit like Amazon and that's never a bad thing.

[Toby Howell]

Right. And which actually we should talk about Amazon a little bit. Amazon did officially leapfrog Walmart in quarterly sales for the first time. Neil and I spoke about this on the show. It wasn't official back then because you know, Walmart hadn't reported, But Walmart reported $180.5 billion in sales during the most recent quarter. Amazon came in at 187 billion. So Walmart still technically leads the way in annual sales, but obviously Amazon is gaining ground there. But I do just want to zoom out a little bit because Walmart is an $800 billion business. It's a microcosm of the entire economy. So you saw that filter through the market yesterday. The Dow was down 1% yesterday. S&P 500 dipped as well. The Nasdaq dipped as well. So even though Walmart is just, you know, one company in the retail sector, it does give you a kind of a lens into what they think consumers will be feeling like over the next year. And they think consumers will be feeling a little bit apprehensive.

[Kyle Hagee]

Yeah, you mentioned the Walmart Amazon distinction. Walmart since 2012 has made the most annual revenue of any company in the US I looked at when the this first started tracking this in the S&P 500. Do you know the, the in 1955 what the top company was for revenue.

[Toby Howell]

I assume it's some oil company.

[Kyle Hagee]

It's actually General Motors. And they made $9.8 billion in revenue.

[Toby Howell]

We have accelerated.

[Kyle Hagee]

We have accelerated. So let's move on to the big screen. James Bond has dodged over 4,000 bullets, gone up against 20 plus super villains, and even once had to skydive into an airplane. However, he might have pulled off his greatest feat yet, wriggling out of the stalemate between the Broccoli family, who has had creative control of the franchise for decades, and and Amazon, who after their purchase of mgm, control the distribution rights of the Bond franchise. That's right. In a new deal announced yesterday, Amazon and the Broccoli family have formed a new joint venture to house Bond ip with Amazon MGM Studios gaining creative control. Now. Why is this news? Well, the relationship between Amazon and the Broccoli family has been contentious since 2022, with the broccoli family viewing Bond as a family heirloom to be handled delicately and skeptical that the algorithm focused Amazon do Bond justice. Amazon definitely didn't help themselves. They kept referring to Bond as quote content, which according to a friend of Barbara Broccoli, felt like a curse word. So what does the new deal open up for Amazon? Well, the Bond franchise. It's one of the highest grossing IPS series in history with over 7.6 billion in box office sales. With the latest Bond film, no Time to die, raking in 775 million. Now Bond can be the crown jewel in the fast growing media empire Amazon is rapidly building. Toby, the real question is, are you throwing your hat into the ring to be the new Bond?

[Toby Howell]

Listen, I am wearing a hat. I will take it off right now and put it in the ring. You are right. This was the vision for Amazon. When they bought MGM Studios, they shelled out a big chunk of change to, you know, bring that under their content umbrella. And the in the crown jewel of that is obviously James Bond. But they've been at this impasse with the Broccoli family because it's not just the Broccoli had control over Bond films. They had ironclad control. They decided when they got to make a new Bond film, who would play James Bond. Whether you get remakes, whether you get television spinoffs. But it goes beyond that. They also had final say over every single line of dialogue that came in the film, every casting decision, every stunt sequence. You mentioned him skydiving in a plane that has to go through Broccoli, every marketing tie in, every TV ad, every poster, every billboard that all filtered through the Broccoli family. Which is why Amazon was like, all right, we bought James Bond, but we. We don't have any control over what he does or, you know, how we use him now through this joint venture they do. Which could be a good thing because we'll probably get a new James Bond movie on the horizon, but also could be a bad thing because who knows if Amazon will treat this IP properly.

[Kyle Hagee]

And this is a massive win for Amazon, I think, because they spent about $8.5 billion buying MGM, but then they couldn't unlock the power of James Bond. And there was an article that came on the Wall Street Journal at the end of last year that was about the relationship between Amazon and the Broccoli family. I read that and literally was like, there's no way they're getting this. Two months later, they have it. But it was very, very contentious. Barbara Broccoli literally said, these people are effing idiots in reference to Amazon. And she said, quote, don't have temporary people make permanent. It seems like their idea was to keep ironclad control. I'm not sure how Amazon pulled it off, but now Amazon's in the driver's seat.

[Toby Howell]

Yeah, I think one of the big sticking points was the Broccoli family never wanted to spin it off as a TV series. Remember, Amazon clearly wants to. They have the Prime TV service. They want to, you know, make a James Bond TV series to just squeeze more juice out of it. But the Broccoli family is like, no, this should be a cinematic franchise. This should only live in theaters. So you are right. I don't know exactly what agreement they came to. Maybe it was just a lot of pinky promises that we won't, like, overuse the ip, but here we are. I also. So Jeff Bezos wasted no time like, posting the article saying, like, woohoo, it's under our control now. And he actually asked his Instagram following to say, like, who should be the next James Bond? It's, you know, it's the most popular question in media to ask. And I was just scrolling through the comments, and the number one name that popped up was Henry Cavill, who, you know, has played Superman, played Witcher, which would be great, but any James Bond ideas come to your mind, who do you think should play?

[Kyle Hagee]

I mean, Timmy to me, Chile.

[Toby Howell]

I don't know if he's got the muscle him in.

[Kyle Hagee]

I just, I think it's funny, like the Broccoli family being like, you have to take this serious. And Amazon's like, yeah, no, we will. And then Instantly Jeff Bezos on Instagram. Like, who's up? Who? Who wants to play Bond?

[Toby Howell]

It's the question everyone wants answered. Let's move on. You know that awkward moment where you call an Uber but there's four of you, so that means one has to sit shotgun? Well, thanks to a new app that debuted this week called Protector, the person sitting shotgun might actually be holding a gun. Protector lets you hire on demand personal armed security guards to give you both a lift and watch your six. According to the app, which is only available in New York and L. A right now, your personal security force will include active duty or retired law enforcement officers, while your ride will be up to three Escalades or or similarly sized vehicles. You can even customize your posse's outfit sim style on the app with business formal and tactical casual listed as options. The app charges at least $200 an hour for one driver and one guard, and you have to book for at least five hours. That's in addition to an annual $129 membership fee. What do we think of Protector though, Kyle? The company that many are calling Uber with guns.

[Kyle Hagee]

I mean the branding is, is something else. I will say personally, I'm a tactical casual type guy. That's how I, that's how I pull up to the function. Look, I think they're saying their market is for people that need high end security. The real market is people that want to cosplay as billionaires. I mean we've seen this go viral on Tik Tok actually. It's like a bunch of 20 somethings who just like want to roll up with bodyguards. And it's kind of a fun thing. There is one where the bodyguards were actually going to get them matcha and coming back. So I think the market, what they say the market is, is not actually the market is going to take advantage of this. It feels a little gimmicky to me. We'll see if it has staying power, I suppose.

[Toby Howell]

Right. One of the reasons that the app's founder said that they brought this service to market, they actually said they rushed it to market after they saw the murder of UnitedHealthcare CEO Brian Thompson. So they were clearly trying to, you know, play on some of those safety fears or safety anxieties that people might have when traveling. But if you do look at a lot of their marketing, it does. It feels like cosplaying a little bit because usually personal security is only afforded to the ultra rich, the billionaires who actually do probably need it now. You can get it enhanced Safety, as you might want to call it, at a decently affordable price. So, yeah, you can take a cynical look at it, or you could say maybe this is providing a service to people who want it. Whatever the case is, they have clearly, you know, struck a chord. We're talking about. A lot of people are talking about it. They've done their job in the. On the marketing front.

[Kyle Hagee]

Yeah, the, the, the CEO, like, having the app and saving us, that felt like in bad taste a little bit to me. Like, saying this app would have saved this person's life. Like, yeah, that was a little odd to me. But the CEO of this, Nick Sarath, he has another app called Patrol. And so there clearly seems to be this market demand for, like, additional security services. And Patrol lets neighborhoods basically crowdfund extra security, including, like, if you raise enough money, you can have drones protecting your neighborhood. So this idea that we need enhanced security seems to be going from individual to even neighborhood level, and they're trying to capitalize on that.

[Toby Howell]

Yeah. Hey, I mean, if it makes you feel important to have more security or if it makes you feel more secure to have people around you, you know, armed, then all the power to you, I guess. Up next, we got stock of the week, dog of the week.

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[Kyle Hagee]

It's Stock of the week dog of the week time where we have one stock who is like Neil sitting on a beautiful warm tropical island and one stock that's stuck in freezing cold Minnesota. Toby I won the James Bond skill Challenge backstage so I will go first. My stock of the week is Hims and Hers Health which is on an absolute heater lately, starting with their super bowl ad which led to a 650% surge in website visits, new customer registrations hitting all time highs and shooting their app up to the number two slot in the health and wellness category on the App Store. And to follow that up, HIM stock has had a massive gain on the news that the company has now acquired Tribi Labs. The deal will allow the telehealth company to offer at home blood draws and more comprehensive pre treatment testing to its users. Its Chief Medical Officer Dr. Carroll said, quote, at home lab testing is one of the most exciting steps towards elevating the personal comprehensive care customers in this country should expect. So what does this mean for the stock? Well, so far Wall street loves the stock. Shares have soared 141% in 2025 entering trading trading as of Tuesday's closed this week and the stock spiked more than 20% in news after this deal was announced. Toby the health and wellness space is so hot right now.

[Toby Howell]

Yeah, Hims and Hers is riding high. It used to kind of be a one trick pony. It had, you know, these hair loss treatments, these ed pills but now it's very much a multi trick pony. Less than a year ago it started offering those compounded GLP1 weight loss drugs. That was a big boon for the company. Now it has blood testing as well. At home blood testing does seem to be kind of the next evolution or the next popular thing in at home health right now because it does give you a good insight into a wide variety of, you know, health indicators that could help you with preventative measures or just get a snapshot of your health. So I do think that we have seen Hims and hers just evolve as a company and Wall street is clearly loving it right now.

[Kyle Hagee]

Yeah, personalized medicine Telehealth is all kind of emerging, and some of these companies are going to be big winners in the space.

[Toby Howell]

I do think the other bet that Hims and hers is making right now is one, it's setting it up itself as against the traditional pharma industry. We saw that, as in the super bowl ad. It literally was saying it took shots at the traditional pharma industry, saying the industry is priced for profits, not for patients. So it is trying to, you know, set itself up as this new age alternative to, you know, that traditional monolithic health insurance, health establishment that a lot of people have negative feeling towards. And then the other thing I think that this blood work acquisition does for them is it gives them a lot of data. So they obviously want to accelerate their development of artificial intelligence, just like every single other company in the world out there. So they're saying that they're going to use part of the data they glean from this blood work. Patient identities will be removed to, you know, build this database of, like, if I get a result where I shows my LDL cholesterol is this level, what does it actually mean? What does it mean across a broad swath of other, you know, patient data? So I do think that the end goal here is to get some more fodder to feed an AI algorithm that could help you manage your health. Which is another reason why I think we saw that, you know, 20% bump yesterday is like, there's a little bit of AI story mixed in.

[Kyle Hagee]

You got to have a little bit of AI in the mix.

[Toby Howell]

Exactly. No, I think that is what hers is thinking, like, what is our AI in the mix? And I think this is, you know, continuing their journey towards, you know, building an actual AI that can help manage your health. Palantir is making its dog of the week debut today after weeks of being a candidate for the opposite side of this segment. The AI company best known for its work with defense agencies had a no good, lousy week, dropping at least 10% both Wednesday and Thursday before paring back some of those losses. The major drops came after the Pentagon announced it's prepared to cut the US defense budget by 8% each year for the next five years. That is not music to the ears of a company that relies on government contracts for over half of its revenue. If that wasn't enough, investors also got a little antsy over a new stock compensation plan that CEO Alex Karp was granted. His new plan allows him to sell nearly 10 million shares of company stock in the next six months if he wanted to which with the stock trading at a price to earnings ratio of 600 to 1, might be an attractive proposition. Carl, not a name you typically expect to see in the Dog of the Week column.

[Kyle Hagee]

I know, and Palantir is a really interesting company because it's like half real company, half meme stock. And they rely so much on retail investors. In fact, Nvidia, Tesla and spy, the Spider S&P 500 ETF, they're the only stocks that have more net inflows from retail investors than Palantir. So people like on the street really love this company. Although it's more of a real company than maybe the amc, you know, meme stock craze. The other thing is every meme stock company has to have like an iconic cult like figure. And Karp is no exception to that. This is someone who loves reveling in kind of the spotlight. He loves retail investors and he says I actually revere everyone that reveres me. And so he has this kind of like cult like personality that people really rally around.

[Toby Howell]

I was going to make the same point. It shows the danger of having retail traders as your main investor base. Obviously they can boost you to these insane highs that we've seen. Palantir, it was the best performing stock in 2024 until this week. It was the best performing stock in 2025 as well in the S&P 500. But if the narrative starts to swift, those same traders can start to abandon you as well. Let's talk about the Pentagon side of things. To Pentagon's 2025 budget is $850 billion. There are plans to make cuts to that budget. You know, the doja vacation of the federal government isn't. Isn't ignoring the Pentagon and its gigantic budget. That being said, though Palantir does still have great connections in the defense industry. It could be, you know, one of those line items where when you're looking at that entire budget you go, maybe do we need to be paying Palantir X amount of money for, you know, this service? So who knows if the fears are overblown, who knows if it will actually be affected by those cuts. But just looking broadly, it's not good to see cuts to the defense industry's budget if you are a Palantir shareholder.

[Kyle Hagee]

It's interesting though, I actually think Palantir is much more well positioned to withstand those cuts and maybe some of the old legacy companies and you know, for you mentioned the doge vacation of the government, proximity to Elon Musk is maybe important. Peter Thiel has been was a co founder and is on the board of Palantir, who is great friends with Elon Musk. And so it feels like this is actually a company that would benefit from reduction from the Department of Defense because they are a little more forward leaning, they're a little more focused on efficiency, they're a little more innovative than some of these old players. So this could actually be good news for Palantir going forward.

[Toby Howell]

Now let's sprint to the finish with some headlines you may have missed. Up first, the IRS is getting slimmer. Today the agency began laying off roughly 6,700 employees, over 6% of the agency's workforce as of yesterday. If you still don't know where the good bathrooms are in the IRS office, you are probably amongst the layoffs. The cuts primarily affected those who have worked for less than one or two years. These layoffs come right as tax filing season is picking up in earnest and the IRS is getting inundated with paperwork and questions from taxpayers. But cuts, cuts aren't expected to include workers essential to the filing season.

[Kyle Hagee]

Yeah, I mean the IRS is in a tough spot also just with general attrition. And 63% of the current IRS is eligible to retire within six years. Some more cuts, morale is low, people might start retiring. It's, it might not be good news for our refunds getting here on time.

[Toby Howell]

I know. So as of February 7th, the IRS had received and processed about 23 and a half million individual returns. That was down about 8% from the same time last tax season, which might show that there is some buildup happening over at the irs with some of these cuts, some of these uncertainty, it might be a headache season that is is brewing upon us right now, especially with these cuts, you know, coming down the line.

[Kyle Hagee]

Yeah. The termination memo read, quote, your continued employment at the agency is not in the public interest. End quote. Which that's a savage way to, to go out. Moving on to the great US Canada war of 2025, aka the Four Nations Hockey Tournament. Now, if you haven't heard of the Four Nations Hockey Tournament, an NHL best on best tournament featuring players from Sweden, Finland, Canada and the U.S. you probably saw some of the clips on social media, national anthems getting booed, fights breaking out on the ice before fans were even in their seats, and tweets about Canada becoming the 51st state or the U.S. becoming the 11th province. Well, Canada was declared victorious last night after a 3, 2 victory against the U.S. but the bigger story was just how electric this tournament was and the demand for tickets whose prices rivaled those of the Super Bowl. The cheapest ticket was at one point hovering around $1200. According to reseller tick pick. That's roughly 450% more expensive than the initial price for the ticket. When this in season NHL tournament was announced. Some of the games also drew 10 million plus viewers across North America. Toby, since the US lost, I think Morning Brew should have to tweet in English and French all of next week.

[Toby Howell]

I agree with you. I mean these games are important to talk about, not just because they'll pull in those Gotti viewership numbers, these Gotti ticket sales numbers. What it's also important to talk about is the geopolitical undertones to all this. Trump said on Truth Social before the game that he called Team USA and he repeated that phrase that he loves to say about making Canada our cherished and very important 51st state. But then after the game, once Canada won, Canadian Prime Minister Justin Trudeau fired back on ex saying you can't take our country and you can't take our game. So there is clearly, I mean I'll call it chippiness because it still is sports at the end of the day. But just with the tariffs, with these conversations, with the way Trump talks about Canada, there's clearly some undertones of bigger, you know, unrest and unease between these two countries. It just stinks that we lost. I really wish we won.

[Kyle Hagee]

The tension made the on ice game a little more electric. And also these like in season tournaments now are really catching on. The NBA did it now the NHL is. So maybe more sports will get into that tournament mode too.

[Toby Howell]

Finally. Just when you thought it was so over for discovering tombs of ancient pharaohs, suddenly we are so back. Egyptologists announced the discovery of the first tomb of a pharaoh since King Tut was uncovered over 100 years ago. The tomb belongs to King Thutmose the Second and was the last undiscovered royal tomb of the 18th Egyptian Dynasty. According to the BBC, an archeological team actually discovered the entrance to the tomb back in 2022, but thought it belonged to the wife of a king. But when they finally got inside, the tomb was decorated to the nines, which is a sign of a pharaoh. The fact that we're still discovering tombs a century later. Kyle Pretty cool.

[Kyle Hagee]

Yeah. And one I wish I knew that Egyptologists was when I was growing up because sign me up for that too. I think we got to start stop digging around. I've. I've seen the Mummy too many times. Great movie. I'm a little worried that Some spirits are going to get out here.

[Toby Howell]

That is a hot take. I just think it's cool that we still are finding these things. I mean, you saw that it was like a mistaken identity. They thought it was just. One of the reasons they thought it belonged to the wife of a king was the location they were saying. I don't know. This location was not very good. It was situated beneath two waterfalls. It was down at the bottom of a slope. So they're like, all this water was flowing through this tomb over the years especially. It was a little wetter back during the time of the 18th Dynasty. So when they got into the tomb, it was not in good shape. There's a ton of water damage. But they did find some fragments of alabaster jars that had inscriptions that showed the name. It talked about the deceased king. And, yeah, I guess your team don't go mucking around because of, you know, evil spirits. I'm team. It's pretty cool that we found a new tomb.

[Kyle Hagee]

It is cool that we think we've discovered everything on earth, but there's still so much more mystery out there, so I'll give you that. It's pretty fun.

[Toby Howell]

All right, that is all the time we have for today. Kyle, thank you so much for stepping in and being Neil. You crushed it, as always. Let's roll these credits. Emily Milian is our executive producer. Raymond Lu is our producer. Olivia Graham is our associate producer. Eugena Naogu is our technical director. Scoops Dard is on audio, hair and makeup is on vacation with Neil. Hope it's not a white lotus situation. Where tragedy sits strikes. Devin Emery is our chief content officer, and our show is production of Morning Brew.

[Kyle Hagee]

Have a great weekend, everyone, and we'll run it back next week.