Business and Finance News - 6.18.24

Adidas Probes China Bribery Claims, Shares Dip as Sales Rebound Looms

• Adidas (ADS-FF) is investigating possible compliance violations in China after receiving an anonymous letter on June 7.

• The letter accused several Adidas employees of receiving millions in kickbacks from external service providers.

• Adidas takes allegations of compliance violations seriously and is committed to ethical standards.

• Adidas shares were down nearly 4% on Monday afternoon following the news.

• Adidas sales in China slumped during the pandemic but grew 8% last year.

• Adidas Greater China's marketing budget totals 250 million euros ($268 million) a year.

• Adidas expects double-digit growth in sales and improved profitability in China in 2024.

*Adidas is a global company that designs and manufactures sportswear, including footwear, apparel, and accessories.

U.S. Sues Adobe Over 'Deceptive' Subscriptions, Citing Hidden Fees and Cancellation Obstacles

• The US government is suing Adobe (ADBE) for allegedly hiding fees and making subscriptions difficult to cancel.

• The DOJ claims Adobe enrolls customers in lucrative plans without clearly disclosing important terms.

• Adobe allegedly hides early termination fees that can amount to hundreds of dollars.

• Customers face an "onerous and complicated" cancellation process involving multiple webpages and pop-ups.

• Adobe executives Maninder Sawhney and David Wadhwani are targeted in the lawsuit.

• Adobe switched from lifetime software sales to monthly/yearly subscriptions in 2012.

• The lawsuit comes amid continued regulatory scrutiny of Adobe, including antitrust concerns over Figma acquisition.

*Adobe Inc. is a multinational software company known for its innovative software products and services, primarily focused on creative and digital media solutions.

Activist Starboard Amasses $500M Autodesk Stake, Mulls Suit Over Delayed Accounting Probe Disclosure

• Starboard Value has taken a $500 million stake in software maker Autodesk (ADSK).

• Starboard is considering legal action over Autodesk's delayed disclosure of an internal investigation.

• The investigation found executives manipulated reporting to improve free cash flow and operating margin metrics.

• Autodesk's CFO Deborah Clifford was ousted and moved to a different executive role.

• Autodesk disclosed the investigation in April, nearly a month after informing the SEC.

• The delayed disclosure came shortly after the deadline to nominate directors for Autodesk's board.

• Autodesk is facing probes from the Justice Department and SEC related to the investigation.

*Autodesk is a software company that creates applications for design, engineering, and entertainment, such as AutoCAD for drafting and 3D modeling.

Buffett's Berkshire Further Trims BYD Stake as EV Maker Tops Tesla in Sales

• Berkshire Hathaway (BRK.A) sold an additional 1.3 million Hong Kong-listed shares of BYD for $39.8 million.

• The sale reduced Berkshire's holding in BYD to 6.9%, from 7%.

• Berkshire first bought about 225 million shares of BYD in 2008 for about $230 million.

• Berkshire had offloaded half its BYD holding through sales in 2022 and 2023.

• BYD started making batteries for mobile phones in the 1990s and pivoted to autos by 2003.

• In Q4 2023, BYD dethroned Tesla as the world's top EV maker.

• The late Charlie Munger was credited for Berkshire's investment in BYD.

*Berkshire Hathaway Inc. is a multinational conglomerate holding company headquartered in Omaha, Nebraska, United States. The company is known for its control and leadership by Warren Buffett, one of the most famous investors in the world.

Bernie Sanders Hauls in Novo Nordisk CEO Over Soaring Ozempic, Wegovy Prices in U.S.

• Bernie Sanders will question Novo Nordisk (NVO) CEO Lars Fruergaard Jørgensen over Ozempic and Wegovy prices.

• Jørgensen agreed to voluntarily testify before the Senate's health committee in September.

• Sanders previously threatened to subpoena a Novo Nordisk executive over the drug prices.

• The HELP committee launched an investigation into Novo Nordisk's high drug prices in April.

• Ozempic costs about $600 per month in the U.S., compared to $59 in Germany.

• Wegovy costs $809 per month in the U.S., while it's $92 in the U.K.

• Two-thirds of GLP-1 users have full insurance coverage; others pay an average of $196 monthly.

*Novo Nordisk is a global healthcare company headquartered in Denmark, specializing in the development, manufacturing, and marketing of pharmaceutical products and services.

Here’s how the markets closed yesterday:

• Dow Jones: 38,778.10 +188.94 (+0.49%)

• S&P 500: 5,473.23 +41.63 (+0.77%)

• Nasdaq: 17,857.02 +168.14 (+0.95%)

• Bitcoin (BTC): $66,574.49 (3:45PM PST on 6/17/24)

• Ethereum (ETH): $3,523.12 (3:45PM PST on 6/17/24)

Here’s how the THE SUPER SIX STOCKS did yesterday:

• Microsoft (3.332T): 448.37 +5.80 (+1.31%)

• Apple (3.322T): 216.67 +4.18 (+1.97%)

• Nvidia (3.228): 131.01 -0.87 (-0.66%)

• Alphabet (2.209T): 178.78 +0.41 (+0.23%)

• Amazon (1.915T): 184.06 +0.40 (+0.22%)

• Meta Platforms (1.285T): 506.63 +2.47 (+0.49%)