00:01 Jared
Time now for some trending stories, starting with Netflix as it makes a move to acquire Ben Affleck’s AI film company Interpositive. Yahoo Finance’s Brooke De Palma joins me here to discuss. So, Brooke, this is kind of a nuanced story, but this is about AI post-production. So, they’re not looking to get rid of the filmmaking workflow like actors, writers, or directors, but tell us about this.
00:32 Brooke De Palma
Yeah, so Ben Affleck essentially created this company just a few years ago. And in the statement that the company provided, they said that they he wanted to create this business to really preserve what makes storytelling human, which is judgment. He felt that he had responsibility to their peers in industry to protect the power of human creativity. But I think this is what makes this really interesting is that this is coming on the heels of Netflix’s major announcement that they’re backing out of that uh Warner Brothers’ bid. And also, when you think about it, this comes at a time when we are talking about the impact of AI on jobs almost every single day now.
01:04 Jared
Yeah. I mean, so, AI slop gets, I’m not even going to call it a bad rap because it’s kind of well-deserved. Uh some a lot of people are pushing back, including me, against some of the content on social. It just doesn’t feel genuine. Right.
01:17 Brooke De Palma
But it also sometimes is is hard to decipher what exactly is AI. And so he’s trying to maintain that human creativity within this business. you sort of the AI tools to help amplify and to help innovate. Yeah.
01:29 Jared
Yeah. Well, I think that’s the kind of the direction they want to go. So, I don’t know, there’s a certain amount of cost cutting that goes in here. And so if you’re Hollywood and you don’t want already AI is laying off a lot of people from writers to production people. And so you got to think that they’re trying to control the narrative as well with this. Yeah.
01:52 Brooke De Palma
Yeah, and I was reading a note from CFRA who did uh put out a buy rating this morning an upgrade from CFRA on Netflix stock. and they did say that the company’s position enables leveraging AI for creator tools and personalization. many notes that I’ve read on the street really see Netflix as a key streaming giant. And so it’ll be interesting to see what the other streamers do to really make sure they’re staying ahead of the AI curve. Yeah.
02:18 Jared
Yeah, and staying ahead of the pushback against AI slop. And we’ll get to some more slop in a second. But first, let’s shift gears here to the US Secretary of Health and Human Services Robert F. Kennedy Jr. In the latest push in his make America healthy again initiative, and he’s pushing back against Duncan Donuts, uh Starbucks, and these are the high sugar drinks that some of them
02:49 Brooke De Palma
o- over 100 grams of sugar in one drink. That is a lot.
02:52 Jared
And here’s what I love. There’s a kind of a pushback here in New England. Donut tread on me. You know, kind of a throwback to the US revolution. There you go. So, uh what do you make of this here?
02:59 Brooke De Palma
I mean, if this is the thing is that one, let’s just say I did reach out to Starbucks and Duncan for comment. I did not hear back. I think it’s worth noting here that this this company is in the business Duncan and Starbucks and every other coffee company out there is in the business of giving options. You’re educated, everything has nutritional facts on it right now if you just look it up on the website.
03:19 Jared
Yeah, Donut used to be in the name.
03:21 Brooke De Palma
I exactly. I I even found out that a Boston cream donut only only has 270 calories today prepping for the story. So everything is out on the internet uh, you know, looking into it. I I think that there’s there’s optionality. There’s now more sugar free options. Dutch Bros had a major push behind that because they have so many sugar free options that really sort of drove Starbucks and Dunkin to now need to get ahead. Now Dunkin and Starbucks both have protein options. It’s really about giving consumers an ample variety here and then you kind of choose what you want with with this in mind.
03:57 Jared
Do you you remember a couple decades back? You might be too young for this, but Mayor Bloomberg, Bloombito, he caught huge, huge uh flack for uh imposing a sugar tax.
04:03 Brooke De Palma
Oh, the sugary drinks.
04:05 Jared
Was it like 20 oz? Yeah, it was, you know, on those big uh giant gulp drinks. So he got a lot of flack for that. I don’t know where it went, but uh I was I wasn’t even living in New York at the time, but You heard about it.
04:13 Jared
Yeah, cuz I watched Saturday night live.
04:14 Brooke De Palma
Yes. But definitely it’ll be interesting to see. I mean, people can choose what they want. There’s more options out there. Optionality is everything right now. And I understand this is all part of a push for more protein, push for more healthier options. So, I get it both ways.
04:31 Jared
Yeah. All right, let’s talk some slop here because elsewhere in the food industry, fast casual struggling to capture consumer wallets. And uh so we have a number of companies uh that uh that surround most of the offices in Manhattan here and I’ve seen lines out the doors over the years, but truthfully, I haven’t seen those lines lately at a lot of these establishments. I’m not going to call anything out here, but uh give us some names that were reported with some hard facts. Right.
04:58 Brooke De Palma
Yeah, so Cava, Sweet Green, Chipotle, those are the kind of names when you think about quote unquote slop bowls here. And what we saw as of late, as you can see on your screen is that same store sales haven’t been performing as well as what they used to be at one time. And if you take a look at foot traffic, that has a lot to do with it. Cava saw foot traffic down about 1.4%, Sweet Green down about 13% when it comes to foot traffic. And then we also had Chipotle, which actually did post a bit of an increase in foot traffic as of late, but their average check size didn’t grow too much. So it’s really sort of a combination of factors. You have less people going to the stores. You have more discerning customers. That’s what many of these executives said on the earnings call that really picking and choosing.
05:32 Jared
Pushing back against $20 lunches.
05:34 Brooke De Palma
Exactly. They’re being more discerning about where they’re spending their money. And then on top of that too, this is a this caters to a pretty younger customer here who has been struggling. We heard today from the BLS support that the unemployment rate for young people, 2024 is still around 7%.
05:51 Jared
Nice way to tie in the jobs report.
05:52 Brooke De Palma
Right, we got to link it all together, Jared. So, Yeah.
05:54 Jared
Yeah, and for the record here, I I find the what I’m calling slop, I find very tasty, and I I had a bowl for lunch, you know, meat over rice can’t be topped. It just has to be done a a few different ways. So, Brooke, thank you so much for stopping by.
06:06 Brooke De Palma
I would agree. Of course.