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There’s so much happening around the world of business and hopefully this headline companion helps keeps you more informed.
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Bryce: [00:00:04] Here's what's making business headlines today. I'm Bryce joined by Ren. It's Wednesday, the 19th of October siren. Where are we heading?
Alec: [00:00:11] Today's surprise for starting in America, heading to France and then finishing in Britain.
Bryce: [00:00:16] Well, let's start in America where it's reporting season and Netflix have delivered investors a positive surprise.
Alec: [00:00:21] It may just feel like we got through a reporting season where companies share their results with the public. And we have. But it's back again. It never stops. Tax rates back now. Companies are reporting on their results for the three months from July to September, also known as Q3.
Bryce: [00:00:39] And coming into this reporting season, Netflix has been a massive disappointment. They reported declining subscriber numbers in Q1 and in Q2, and the share price is down 60% this year.
Alec: [00:00:49] But buying Netflix is back. Netflix have turned it around. They added 2.4 million subscribers in the three months, grew revenue 6% from this time last year and reported $7.9 billion in revenue and $1.5 billion in profit for the quarter $8 billion in revenue in three months. I'd take it.
Bryce: [00:01:13] Nothing like surprising the market on the positive trend. Now keep in mind, Netflix has about 220 million subscribers, so 2.4 million is an additional 1%. But investors were excited that Netflix had stopped. The decline in the share price was up 14% after hours.
Alec: [00:01:29] Reporting season is really just kicking off in the US, so we'll be learning a lot more and sharing a lot more here in the coming episodes. But Bryce, let's move on. Let's go to France where? Lafarge I don't know if I'm pronouncing that right. A French cement company has pled guilty to supporting Isis.
Bryce: [00:01:49] Lafarge is one of France's largest companies and its Syrian subsidiary, Lafarge Cement. Syria admitted to paying Isis and al-Nusra Front nearly 6 million in exchange for permission to operate a cement plant in Syria from 2013 to 2014.
Alec: [00:02:05] American prosecutors allege that Lafarge bought more than $70 million in revenue from that Syrian facility while under ISIS control.
Bryce: [00:02:13] Now the company has admitted wrongdoing and agreed to pay a $778 million fine, which, according to prosecutors, is the first time a multinational corporation has actually been charged and admitted to providing material support to foreign terrorist organisations. But let's move to our final story. Heading over to Britain, where we continue to see firsts. The first here it is, the first time regulators have forced the matter to sell a part of its business.
Alec: [00:02:41] Yes, this is something that regulators have been trying to do across the world for years. And it's the Brits that have finally got it done in 2020, Meta bought Giphy for $315 million. Giphy is a repository for video clips and gifs. Think when you send a video reaction to your WhatsApp or Messenger group chat.
Bryce: [00:03:03] And British regulators ruled that Meta's acquisition reduced competition in the social media and the display advertising market. So they ordered Meta to sell Giphy.
Alec: [00:03:13] Now, Meta obviously challenged that ruling, but after losing an appeal, has agreed to abide by the regulator's decision. And the important thing here is that this sale is global. It's not just British regulators forcing Meta to sell Giphy. British arm Meta are being forced to sell this company globally.
Bryce: [00:03:32] I wonder what they're going to sell it for.
Alec: [00:03:34] It hope more than well, they would hope more than $315 million. But look, as we said, after years of regulators trying to break up, Facebook now Meta, the British have had some success. So I guess the question is, is this an isolated incident? Or will regulators have more success in the future?
Bryce: [00:03:50] And let's move to our fact of the day, because that is the end of our three stories for today. And what have you got?
Alec: [00:03:56] 40 years? Well, 40 years ago, that is when three economists published work on the importance of banks in our financial system. And honestly, I didn't need a university degree to tell me that.
Bryce: [00:04:09] But 40 years later, and they have been awarded the Nobel prize for economics.
Alec: [00:04:14] So on today's episode of the dive accompanying this episode, we unpack what they found. 40 years ago, the work that they did to win this Nobel prize. And we also ask what was wrong with the work for the last 39 years? If it was so groundbreaking, why didn't they win it in the eighties or the nineties? But why did they win it today? So you can find that episode in your podcast accompanying this episode. But Bryce, that'll do us for today.
Bryce: [00:04:42] Have a great afternoon.
