Raphael Stevens

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    in Finance

    The SEC ruling on Ethereum ETFs could mark a historic shift in crypto investing

    VanEck CEO Jan van Eck sees a major sentiment shift underway in the cryptocurrency market linked to the U.S. Securities and Exchange Commission’s approval of a rule change allowing for Ethereum exchange-traded funds.
    “This is really one of the most amazing things that I’ve seen in my career with respect to securities regulation,” van Eck told CNBC’s “ETF Edge” this week. 

    VanEck was the first to apply to the SEC for permission to list its proposed Ethereum ETF. With that first hurdle cleared, VanEck can begin the process of bringing the product to market, though the exact timeline is unclear.
    “There was a real risk that the SEC was going to lose any kind of jurisdiction over digital assets. So the first reaction was to get the ETF, Ethereum ETF approval green lighted,” he said. “But I think there’s a bigger narrative going on as well.”
    To van Eck, the buzz around Ethereum this May means clearer regulation on the horizon and an increased investor interest in crypto. In a statement on its website, his company said that “the evidence clearly shows that ETH is a decentralized commodity, not a security.”
    Van Eck said the Financial Innovation and Technology for the 21st Century Act, or FIT21, passing in the House on May 8 was another major step toward regulatory clarity for cryptocurrencies, even though he is doubtful it will make it to the Senate before the election.
    Ether spiked on the SEC’s approval of applications to list Ethereum ETFs on May 23, but is virtually flat since then.
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    Italy is bracing for a record wave of tourists, but is having trouble handling them

    Tourists line a street in Venice, Italy, on Saturday, March 16, 2024. Venice collected €37 million in overnight tourist taxes in 2023, with hotels charging guests anywhere between €1 and €5. 
    Nathan Laine | Bloomberg | Getty Images

    Bellagio, Lake Como, Italy — When boat drivers start complaining about the tourists overrunning this famous lakeside resort, where Taylor Swift and Travis Kelce stayed at the Villa Sola Cabiati in Tremezzo two weeks ago after her series of Paris concerts, you know you have a problem. 
    “There are days when traffic comes to a stop, you cannot move,” our driver told us. He makes his living driving tourists up and down the lake for the famous views of the mountains and the 19th-century villas like Villa del Balbianello, where parts of “Casino Royale” and “Star Wars: Episode II” were filmed. 

    He considers himself fortunate he’s a boat driver: he pities the poor tourists who rent cars or try to find an elusive taxi. 
    “Some days it can take an hour to go 10 kilometers [about 6 miles],” he said, noting that the tiny two-lane roads not only can’t handle the traffic, they can’t handle the larger cars that are being built. “Many towns can only have traffic go in one direction, so everyone has to wait,” he said. 
    Can’t live with them, can’t live without them
    Italy is caught in an envious trap: it can’t live without tourists, but it’s having trouble handling the influx, particularly after Covid. Sixty million tourists flooded the country last year, pumping an enormous amount of money into the economy. Travel and tourism accounted for 10.2% of Italy’s GDP in 2022, according to Statista.  The sector employs approximately 4.4 million people, about 16% of total employment. 

    A general picture shows the main facade of the Pantheon in Piazza della Rotonda on March 30, 2024 in Rome, Italy.
    Emanuele Cremaschi | Getty Images

    The problem of “too many tourists” may seem like a problem a country wants to have, but in recent years the crush of visitors has gotten so bad that Italian authorities have had to take measures to avoid damage to centuries old structures that cannot handle the crush of so many visitors. Venice has been charging 5 euros to enter the city for day travelers not staying overnight, for example. 
    Want to see Da Vinci’s “Last Supper” in Milan? Good luck: tickets are sold out weeks in advance, and to avoid irreparable damage to the painting visitors are restricted to roughly 30 at a time for a maximum of 15 minutes. 

    Not only are there too many tourists, there’s not enough people to serve them. 
    The Italian Association of Employment Agencies (Assolavoro) noted there is a shortage of staff to work in the hotel and beach sectors this summer, which is expected to see a new record for tourists. There’s shortages of chefs and waiters in Marche. In Sardinia, about 25,000 seasonal workers are needed. 
    Italy a bargain? Not quite, but there is a lot of value 
    Food is still surprisingly affordable, at least compared to New York prices. An espresso in Milan, an hour away, can be had for 1 euro (about $1.10). Croissants for two or three euros. 
    At the famous Trattoria Milanese in the center of Milan, a generous serving of the city’s two most famous dishes — veal Milanese, and osso bucco with risotto Milanese, will only set you back about $30-$35 apiece, and can be had much cheaper in less famous spots. Outstanding local wines can be bought for $20-$30 in restaurants and $10 in the supermarket. 
    Even Milan’s famous bars are not stratospheric. At Camparino in the Galleria, one of the temples of cocktail culture in Italy, you can have a negroni or Aperol spritz for $20, prepared by ridiculously good-looking 25 year old waiters in formal wear preening for the uber-dressed-up crowd strolling past, heading for a night of opera at La Scala. 
    The crush of visitors means reservations are tough to get. Here on Lake Como, it’s still nearly impossible to get a reservation at the Veranda restaurant at one of George Clooney’s favorite spots, Villa D’Este (if you’re lucky to snag one, be sure to show up: no-shows are charged 100 euros per person). 
    Clooney himself lives up the street, at Villa Oleandra, which was featured in his film, “Ocean’s Twelve.” 
    Of course, if you really want to hang out with A-list, there are no bargains. The famous Villa La Cassinella on the lake can be yours, for 100,000 euros a week. A wedding at Villa Balbiano can cost 320,000 euros, but we’re talking 110 people for 3 days. The same 110 wedding guests will set you back 250,00-500,000 euros at the Grand Hotel Tremezzo. 
    Thinking of calling Uber? Forget it
    It’s not only hard to get a reservation: it’s hard to get a taxi to get there. Or anywhere. 
    Sharing the phone numbers of reliable private taxi drivers is a bit of an obsession in Lake Como, where the roads are so narrow and crowded, and taxis few and far between, that even short trips must be booked in advance. 
    It was so hard to get around, even in Milan, that I just hired the cab driver who picked us up at the airport for two days. I was puzzled that the only Uber options were high-priced black cars.
    My driver flew into a rage when I mentioned Uber. 
    “These people are trying to steal the jobs of the taxi drivers,” he screamed. “They are taking my job. The politicians have been paid to allow them into the country.” He was planning to go on strike next week, along with the other taxi drivers. 
    He doesn’t have much to worry about. 
    “The Uber service you are familiar with in North America where private individuals drive their own cars is illegal in Italy since 2015,” travel writer Rick Steves said in a note to his readers last year. 
    “Only licensed taxi and limo drivers can provide that service. As a result Uber does provide a service in Italy (called Uber Black, Uber Van) but when you summon a car with Uber, a licensed official black limo driver with a luxury car will show up and as a result the price will be higher than a regular taxi,” Steves advised. 
    A lot higher. Uber wanted 100 euros to take me less than a mile, a 10-minute ride, in central Milan. I paid the cab driver 170 euros for five hours. 
    Still, standing in front of the “Last Supper,” even for 15 minutes, provides one of those sublime experiences that makes the hassle worthwhile. 
    I was glad it only lasted 15 minutes. I had to get out to call the restaurant we were going to that night for a reservation, and make sure I had a cab to get there. Being a tourist in Italy is turning into a full-time job. More

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    Savings app CEO says 85,000 accounts locked in fintech meltdown: ‘We never imagined a scenario like this’

    For three weeks, 85,000 Yotta customers with a combined $112 million in savings have been locked out of their accounts, CEO and co-founder Adam Moelis told CNBC.
    The disruption, caused by a dispute between fintech middleman Synapse and Tennessee-based Evolve Bank & Trust, has upended lives, Moelis said.
    “We never imagined a scenario like this could play out and that no regulator would step in and help,” he said.

    Oscar Wong | Moment | Getty Images

    When Adam Moelis co-founded a fintech startup named Yotta in 2019, he wanted to give Americans a new way to save money to help them cushion the ups and downs of life.
    Instead, his company has inadvertently been a source of deep pain for thousands of customers who relied on Yotta accounts to receive paychecks, pay bills and save for emergencies.

    The crisis began May 11, when a dispute between two of Yotta’s banking partners — fintech middleman Synapse and Tennessee-based Evolve Bank & Trust — led to the lockup of accounts at Yotta and at least two dozen other startups. Synapse declared bankruptcy earlier this year after several key clients abandoned the firm amid disagreements over the tracking of customer funds.
    For the past three weeks, 85,000 Yotta customers with a combined $112 million in savings have been locked out of their accounts, Moelis told CNBC. The disruption had upended lives, forced users to borrow money for food and thrown upcoming events like surgeries or weddings into doubt, he said.
    “The stories are heartbreaking,” Moelis said. “We never imagined something like this could happen. We worked with banks that are members of the FDIC. We never imagined a scenario like this could play out and that no regulator would step in and help.”

    Boom & bust

    The ongoing mess has exposed the risks in a corner of fintech that grew in prominence during a boom in venture investment — and it will likely reverberate for years as regulators increase scrutiny of the space.
    The so-called “banking as a service” model allowed consumer fintech companies to quickly launch savings accounts and debit services, with firms like Synapse acting as a bridge between the startups and FDIC-backed banks that ultimately held deposits.

    The heart of the dispute between Synapse and Evolve Bank involves a foundational function of finance: keeping accurate ledgers of transactions and balances. Synapse and Evolve disagree on how much of Yotta’s funds are held at Evolve, and how much are held at other banks that Synapse worked with.
    Synapse hasn’t responded to requests for comment, and Evolve has blamed Synapse for the breakdown.
    The Synapse bankruptcy has mostly ensnared lesser-known consumer fintech firms, especially after larger fintech players including Mercury and Dave fled the Synapse platform in the past year.
    That has left Yotta, which encouraged users to save money with free weekly lottery-style sweepstakes, as one of the largest companies to be affected. Accounts at crypto firm Juno and at Copper, which offered savings accounts for families and teens, also have been frozen.

    Non-systemic meltdown

    Moelis, who has been in contact with other fintech principals impacted by the Synapse failure, estimates that at least 200,000 total customer accounts with balances are locked. While Synapse has said in court filings it has 10 million end users, it’s likely that active accounts are far smaller, Moelis said.

    Adam Moelis, Co-Founder at Yotta Savings.
    Courtesy: Yotta

    The fintech co-founder said he believes the relatively limited scope of the issue, and the fact that most of those affected aren’t wealthy, has given regulators clearance to let the situation play out. Last year, regulators swiftly intervened in the regional banking crisis that threatened uninsured deposits of startups and rich families, he noted.
    “To me, if this was happening at a larger scale, I think regulators would have done something by now,” he said. “We’ve got real, everyday Americans that aren’t necessarily wealthy and don’t have the ability to lobby that are being impacted.”
    The Federal Reserve and the Federal Deposit Insurance Corp. have declined to comment on the issue. Representatives of the agencies have pointed to efforts they’ve made to encourage banks to manage the risks of using fintech partners.

    ‘Money doesn’t just disappear’

    But developments in the California bankruptcy court overseeing the Synapse failure give Moelis hope that at least some relief — a partial release of funds, perhaps — may be coming.
    Last week, former FDIC Chair Jelena McWilliams was named trustee over Synapse. Her job is to develop a plan to maintain Synapse systems and craft a solution “that allows funds to be returned to end users, to the rightful owners of those funds, as soon as humanly possible,” said Judge Martin Barash.
    For his part, Moelis said he doesn’t side with either Evolve or Synapse in their dispute — he just wants the situation resolved.
    “I don’t know who’s right or who’s wrong,” he said. “We know how much money came into the system, and we are certain that that’s the correct number. The money doesn’t just disappear; it has to be somewhere.”

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    Retailers like Gap and Foot Locker had a strong week. That doesn’t spell a consumer comeback

    First-quarter retail earnings are coming to a close, and shoppers are still spending, but being more selective than ever.
    Winners like Foot Locker, Gap and Abercrombie & Fitch offered shoppers the right combination of value, fun and product, leading to strong results that largely beat expectations.
    Meanwhile, losers like Kohl’s fell short because of their inability to properly chase trends.

    The Gap logo is displayed at a Gap store in Los Angeles, April 25, 2023.
    Mario Tama | Getty Images

    Retail’s biggest winners during first-quarter earnings aren’t thriving because consumers are suddenly spending more on discretionary goods — it’s because they’re executing well and cash-strapped shoppers are choosing them over competitors. 
    If there’s one takeaway from results posted by the largest U.S. retailers over the last few weeks, it’s that shoppers are still spending — but being far more selective about where.

    Feeling the brunt of sticky inflation, high interest rates and an economy that feels tougher than it may actually be, consumers are prioritizing purchases that have the right combination of value, convenience and fun.
    Companies like Abercrombie & Fitch, TJX Companies and Gap impressed Wall Street with their results, while others like Kohl’s, American Eagle and Target disappointed.
    Take Gap and Foot Locker — two unlikely winners that posted results on Thursday. Both retailers are in the midst of ambitious turnaround plans and are performing better than expected because of new strategies they’ve implemented. 
    Gap posted positive comparable sales for all four of its brands — Athleta, Old Navy, Banana Republic and its namesake banner — for the first time in “many years,” beating Wall Street’s expectations across the board, the company said. 
    For years, Gap had been losing market share to buzzy competitors. But under new CEO Richard Dickson, the marketing guru credited with reviving the Barbie franchise, the apparel chain has focused on financial rigor, brand storytelling and product development. In under a year, Gap’s sales and profits have meaningfully improved, and its brands are beginning to be part of the cultural conversation again.

    A few weeks ago, actor Anne Hathaway went to a Bulgari party wearing a white Gap shirt dress that had been designed by the company’s new creative director, Zac Posen. Critically, Gap dropped the $158 dress to consumers, and it sold out within hours. This combination of marketing and exclusive product drops is what Gap had long been lacking, and what competitors had already been doing. 
    Foot Locker had declined over the last couple of years, but with the right combination of new strategies and a little bit of luck, its turnaround is showing signs of life. 
    Under CEO Mary Dillon, Foot Locker has worked to change its stores, where it does more than 80% of its sales. It has tried to create not only a better shopping experience for consumers but also a better place for its critical brand partners.
    Instead of two walls of shoes with competing brands mixed together, Foot Locker is changing its fleet so the brands have their own unique displays. Its new “store of the future” concept at a New Jersey mall that brings that strategy to life has become its best performing store in North America in just a few weeks, Dillon told CNBC, adding that brands are thrilled with the new design. 
    The shift couldn’t have come at a better time. Years into Nike’s strategy to cut out wholesalers and sell directly to consumers, the retailer is realizing it went too far and is now changing course.
    With refreshed stores and better product displays, consumers are converting more, too, and paying full price — even Foot Locker’s lower-income shopper. 
    “Our consumer … this is a category that is very important to them. So when people have discretionary income, it may be limited, but you’re gonna prioritize where you spend it, right?” said Dillon. “We’re proving that people are willing to spend full price, but you have to have the right products and serve it up in a way that makes it enticing, right? So that’s where the whole customer experience really matters.” 
    Elsewhere, Dick’s Sporting Goods posted a solid first-quarter report Wednesday, as executives said average selling prices and transactions rose and that they saw no signs of consumers trading down for cheaper options. That may not mean shoppers are spending more broadly, though: Dick’s has long been considered a best-in-class operator that offers a solid shopping experience, meaning it can win even when consumers are picky with their spending.

    Denim wars

    Two retailers that didn’t have great quarters — American Eagle and Kohl’s — tell a story of executing poorly or missing out on trends. 
    American Eagle handily beat earnings estimates thanks to a new strategy designed to boost profitable growth, but it fell short on revenue and issued cautious guidance that was slightly below Wall Street’s expectations. 
    American Eagle president and executive creative director Jennifer Foyle told CNBC that the brand is working to cut out items that aren’t landing with shoppers and dig down into the ones that are. She said the retailer was overly focused on jeggings in the past but now, low-rise, baggy fits are in. 
    During a store visit at the American Dream mall in New Jersey on Thursday, an associate told CNBC that the location didn’t have the low-rise, baggy fit in-stores, and they were only available online. Meanwhile, there was a wall of jeggings. Still, denim was a strong performer for the company during the quarter, and it had a variety of other styles that resonated with customers at the location, the company said.

    Denim is having a moment with shoppers. Search levels for denim are hitting peaks in a 20-year data set, particularly for categories like tops and dresses, according to a Morgan Stanley research note. 
    Kohl’s is missing the mark in a far more meaningful way. The retailer posted dismal numbers on Thursday, as both earnings and revenue fell well short of expectations. It cut its full-year forecast and its shares plunged more than 20%, the stock’s biggest single-day percentage decline ever.
    The weak results illustrated a challenge the retailer is still contending with: Keeping up with trends and staying relevant. 
    CEO Tom Kingsbury told CNBC he expects the “head-to-toe” denim trend to play a role in the back half of the year, but it could already be out of style by the time Kohl’s gets around to adding the clothing items to its shelves.
    “Denim is OK business for us. I mean it’s really not the most important time for denim,” said Kingsbury. “We’re selling shorts and tees. And more, you know, warm weather product.” 
    Gap, one of the longtime denim leaders, didn’t seem to be concerned about denim going out of favor because the weather is warmer. CEO Dickson said the company is getting ready to launch its “exclusive lightweight denim fabric” dubbed “Ultra Soft” in time for the summer.
    Failing to chase trends has been an ongoing issue for the aging department store Kohl’s. Kingsbury told CNBC in March that Kohl’s used to buy product for the juniors department catering to teen girls — one of the most trend-driven areas of its stores — 12 to 14 months in advance. When the apparel hit the sales floor, it was “dead on arrival.”
    In an age where viral TikTok videos dictate the life and death of trends, it’s more important than ever for retailers to stay on top of what’s working with customers and what isn’t. They’re not just competing with legacy players, they’re also vying for customers with innovative yet controversial upstarts like Chinese-linked Shein, which can go from an idea to an online product in a matter of weeks.
    That’s a far cry from the lead times at Under Armour, where it currently takes about 18 months to get a product from an idea to a showroom floor. During an earnings call with analysts on May 16, CEO Kevin Plank called the system “just plain uncompetitive in the 2024 landscape” as he laid out a plan to streamline the process. 
    Meanwhile, Abercrombie & Fitch posted another stellar set of results, even as it begins to lap tougher comparisons. It has posted torrid growth in part because the company is responsive to its customers and a has nimble supply chain that has allowed it to chase trends quickly and efficiently. 
    It posted its strongest first quarter in history, and now expects sales to grow 10% in fiscal 2024, up from previous guidance of between 4% and 6%. 
    CEO Fran Horowitz told CNBC that low-rise, baggy jeans are also uber-popular with its customers. During a recent visit by CNBC to its Hollister store just a short walk from American Eagle’s outpost, plenty of those style of jeans were on display for shoppers as soon as they walked into the store.

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    Why job skills could make or break your next interview

    More companies are adopting “skills-based hiring.”
    They place more importance on candidates’ competencies than traditional filters, such as educational attainment and years of experience.
    Developing and demonstrating the skills laid out in job ads are key for job seekers.

    Azmanjaka | E+ | Getty Images

    Many companies are pivoting to a new form of hiring that emphasizes applicants’ skills over more traditional metrics, such as education or years of experience, according to recent reports and data.
    The share of U.S. online job postings that list a specific requirement for employment tenure has fallen by 10 percentage points, to 30%, in the two years through April 2024, according to data from job site Indeed.

    Additionally, most job ads, or 52%, don’t have a formal education requirement, up from 48% in 2019, Indeed found. The data from Indeed says that mentions of college degrees have fallen in 87% of occupational groups over that time.

    A recent ZipRecruiter survey of 2,000 employers also shows a shift toward so-called skills-based hiring, which prioritizes “competencies” over traditional credentials. Nearly half, or 45%, of employers scrapped degree requirements for some roles in the past year, and 72% now prioritize skills over certificates in job candidates, according to the ZipRecruiter survey.
    The trend, which prioritizes a candidate’s practical skills and real-world experience over formal education, appears to be “gaining momentum,” according to ZipRecruiter.
    Meanwhile, hiring managers are being more explicit in job ads about the specific skills they seek in applicants, said Cory Stahle, an economist at the job site Indeed.
    “We definitely see a change in the way the interview and hiring process works,” Stahle said.

    Skills-based hiring is a ‘win-win’

    The demand for workers surged to a record high when the U.S. economy reopened in 2021 after early pandemic-era lockdowns. Businesses struggled to fill jobs amid scarce talent and high competition for workers.
    That hiring “pressure” led employers to drop college degree requirements, a filter that “disqualifies” about 62% of Americans who lack a degree, according to a recent joint study from the Harvard Business School and the Burning Glass Institute.
    Additionally, companies have put more focus on workplace equity, the report said.
    More than 70% of Black, Hispanic and rural workers don’t have four-year degrees — and may have valuable skills overlooked due to the “paper ceiling,” according to Randstad USA, a staffing agency.
    More from Personal Finance:Why the minimum wage hasn’t budged despite inflationHiring stays strong for low earnersDoes college still pay?
    While traditional measures of job fit, such as schooling, will likely remain important for surgeons and other professions, many employers realize such qualifications aren’t always a good proxy for job fit, Indeed’s Stahle said.
    Job seekers benefit via new career opportunities that may not have been previously available, he added.
    There are also tangible, measurable “win-win” outcomes of skills-based hiring for businesses and workers, such as higher retention rates among workers without college degrees and large average salary increases for such candidates, according to the Harvard-Burning Glass study.

    That said, there are some limitations, like entrenched behavior among hiring managers.
    For example, about 45% of firms “seem to make a change in name only, with no meaningful difference in actual hiring behavior following their removal of stated requirements from their postings,” the Harvard-Burning Glass report said.
    “Change is hard” for employers, it added.

    What this means for job seekers

    “If the [job ad’s] focus is on skills, the focus of your resume should be on skills as well,” Stahle said.
    While skills should be “prominent” in such cases, that doesn’t mean applicants should forgo traditional information, Stahle added.

    They’d still want to give an accurate representation of their work history and education, since an applicant’s resume may still be reviewed by a hiring manager who values such qualifications, he said.
    It’s not just the resume, though: Job candidates should be prepared for prospective employers to administer some sort of skills test during the hiring process, though the practice varies from company to company, he added.
    Developing and demonstrating the identified skills are the two primary keys for job seekers, he said.

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    FDA approves Moderna’s RSV vaccine for seniors, the company’s second-ever product

    The Food and Drug Administration approved Moderna’s vaccine for respiratory syncytial virus.
    The decision is a win for Moderna, which desperately needs another revenue source amid plunging demand for its Covid jab, its only commercially available product. 
    An advisory panel to the Centers for Disease Control and Prevention will vote in June on recommendations for the use and intended population of Moderna’s shot, which follows similar jabs by Pfizer and GSK.

    The FDA has approved Moderna’s RSV vaccine for older adults.
    Courtesy: Moderna

    The Food and Drug Administration on Friday approved Moderna’s vaccine for respiratory syncytial virus for adults ages 60 and above, the company’s second-ever product to enter the U.S. market. 
    The decision is a win for Moderna, which desperately needs another revenue source amid plunging demand for its Covid jab, its only commercially available product. 

    The approval of Moderna’s shot is based on a late-stage trial on older adults, who are more vulnerable to severe cases of RSV. The virus kills between 6,000 and 10,000 seniors every year and results in 60,000 to 160,000 hospitalizations, according to data from the Centers for Disease Control and Prevention.
    Moderna’s shot will be marketed under the brand name mRESVIA. It is the first messenger RNA vaccine to get approved for a disease other than Covid. The company’s shot is also the only RSV vaccine to be available in a pre-filled syringe, which is designed to make it easier to administer to patients.
    An advisory panel to the CDC will vote in June on recommendations for the use and intended population of Moderna’s shot. The company expects an equal recommendation to existing RSV shots from GSK and Pfizer, Moderna executives said during an earnings call on May 1. 
    A positive recommendation from the CDC would allow Moderna’s vaccine to compete against GSK and Pfizer, which launched their respective shots in the U.S. last fall. Pfizer’s vaccine has so far lagged behind GSK’s, but both shots have so far recorded hundreds of millions in sales. 
    Moderna’s full-year 2024 sales guidance of roughly $4 billion includes revenue from its RSV vaccine. 

    The approval demonstrates the versatility of Moderna’s messenger RNA platform beyond treating Covid. The biotech company is using that technology to tackle a range of different diseases, including RSV, cancer and a highly contagious stomach bug known as norovirus. 
    “The FDA approval of our second product, mRESVIA, builds on the strength and versatility of our mRNA platform,” Moderna CEO Stéphane Bancel said in a release. “With mRESVIA, we continue to deliver for patients by addressing global public health threats related to infectious diseases.”
    The biotech company currently has more than 40 products in development, several of which are in late-stage trials. They include its combination shot targeting Covid and the flu, which could win approval as early as 2025.

    More CNBC health coverage

    Moderna is also developing a stand-alone flu shot, a personalized cancer vaccine with Merck and shots for latent viruses, among other products.
    Moderna has said it expects to return to sales growth in 2025 and to break even by 2026, with the launch of new products. 
    Investors have high hopes for the long-term potential of Moderna’s mRNA product pipeline: Shares of the company are up more than 40% this year after falling nearly 45% in 2023. 

    Vaccine trial data

    The FDA was initially slated to make a decision on Moderna’s jab on May 12. The agency delayed the approval, citing internal “administrative constraints.” 
    A phase three trial on roughly 37,000 people showed that Moderna’s vaccine was 83.7% effective at preventing at least two symptoms of RSV at around three months. New data from that study in February showed the shot’s efficacy declined to 63% at 8.6 months. 
    At the time, those results raised concerns among investors that the shot’s efficacy declined faster than that of shots from GSK and Pfizer. Moderna in a statement said comparisons can’t be made without head-to-head trials on shots.
    The company added that its trial had different study populations, geographic locations and case definitions for RSV, among other differences. 
    No significant safety concerns were identified in patients who took the shot in the trial. Most side effects were mild to moderate and included injection site pain, fatigue, headache, muscle pain and joint pain. 

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    Aston Martin gets a boost from Formula 1 and new high-performance models

    Sports carmaker Aston Martin expects to become cash-flow positive this year, according to Executive Chairman Lawrence Stroll.
    Aston Martin has overhauled and improved manufacturing, shored up its financials and is now launching a fleet of new products defined by high-performance and luxury finishes.
    Stroll said the automaker got a boost from Formula 1, more high-end customizations and a younger customer.

    With a parade of new models and a marketing tailwind from Formula 1, sports carmaker Aston Martin expects to become cash-flow positive this year, according to Executive Chairman Lawrence Stroll.
    “We’re now at a really transitional moment, with an inflection point for this company,” Stroll told CNBC. “We’re introducing all our products, finally, after designing and building them for the last four years, after I took over. Going forward, we will now have a normal quarterly output, not these hockey sticks we’ve seen in the past, but the more traditional quarterly flow of new vehicles constantly coming to market.”

    Stroll said the company, which has been losing money for years, expects to become cash flow positive starting in the third quarter and continue to be in the fourth quarter and beyond.
    That would mark a dramatic turnaround for the storied British carmaker, famed for both its role in the James Bond movies and its history of financial ups and downs. Stroll, a billionaire former fashion mogul who stepped in as Aston Martin executive chairman in 2020, imposed a sweeping plan to restore the brand’s shine and profits.
    Aston Martin has overhauled and improved manufacturing, shored up its financials to make investments in the future, and is now launching a fleet of new products defined by high-performance and luxury finishes.

    Owner of Aston Martin F1 Team Lawrence Stroll (R) shakes hands with Ferrari Team Principal Frederic Vasseur on the grid prior to the F1 Grand Prix of Miami at Miami International Autodrome on May 05, 2024 in Miami, Florida.
    Chris Graythen | Getty Images

    Still, production fell and pre-tax losses doubled in the first quarter compared with the previous year, sending the company’s shares to their lowest level since 2022. Stroll said the production drop and an expected drop in the second quarter are part of an intentional plan to phase out older models and make room for the slate of new models to ramp up in the coming months.
    “We made a conscious decision to stop all production” on certain models,” he said. “We reduced the manufacturing wholesale volume in order to not have a build-up of older cars at the dealer networks while we’re launching all our brand new vehicles.”

    The new vehicles include the new Vantage, a front-engine, rear-wheel-drive sports car with 656 horsepower and a starting price of $191,000.
    The automaker also unveiled the new DBX707, its high-powered SUV, which can do 0mph to 60mph in 3.1 seconds and top 200 mph. The company has also unveiled an open-topped version of its DB12, called the DB12 Volante.
    Aston Martin has teased a new super-powered V-12, expected to be called Vanquish, later this year.
    It’s also expected to begin deliveries of its $800,000 hybrid supercar, called the Valhalla, at the end of this year or early 2025.

    The $800,000 Aston Martin hybrid Valhalla.
    Courtesy: Aston Martin

    Along with new models, Aston Martin is betting on continued growth from its personalization program. A year after opening its “Q New York” showroom, which allows customers to customize their cars with their own paint colors, interior fabrics, stitching and other details, the company is planning Q locations in London, Miami and California.
    Stroll said some customers are paying an additional $100,000 to $200,000 beyond the sticker price of their cars for highly specialized personalization. One customer even requested fur in the interior, he said.
    The customization program has helped boost the average sale price of an Aston Martin by 35% over the past two years, to $294,0000.
    “It’s really, really been a home run,” Stroll said. “Not only from the financial point of view. People come in [to Q New York] and they understand what Aston Martin is all about. They say, ‘OK, I get it.’ You know, it’s the show, it’s the feeling.”
    Aston Martin is also attracting a younger buyer, thanks in large part to its Formula 1 team, which Stroll owns. Stroll said the average age of an Aston Martin customer is now 42, down from 55 four years ago.
    “The brand is really on fire, and a lot of it is to do with Formula 1,” he said. “Being in Formula 1 the last three years has really rejuvenated the brand significantly, and also all of our new product portfolio.”
    Stroll dismissed reports that he’s looking to sell a minority stake in the Aston Martin Formula 1 team to help fund the car company.
    “We absolutely do not need to raise capital,” he said. “When you start making 8,000, 9,000 vehicles [a year], we become extremely cash flow positive. … So no there’s no interest or requirement to raise” more.
    On the company’s electric vehicle future, Stroll said the company is delaying the launch of an all-electric Aston Martin from 2025 to 2026. The company has designed four EVs based on the same platform, but Aston Martin customers aren’t showing enough demand.
    “We don’t want to swim upstream,” he said. “Our consumer, at least the Aston Martin customer, the high-performance customer, is telling us we’re not ready for an electric vehicle, at least not from us. So we’re hearing that loud and clear.”

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    Pfizer’s drug for advanced lung cancer shows promising long-term trial results

    Pfizer on Friday said its drug for an advanced form of lung cancer showed promising long-term results in a late-stage trial, which could help establish it as the new standard treatment for the condition.
    Lorbrena is already approved in the U.S. for treating adults with advanced non-small cell lung cancer who have a mutation in a gene called ALK.
    Pfizer will present the results on Friday at the American Society of Clinical Oncology’s annual meeting in Chicago.

    CFOTO | Future Publishing | Getty Images

    CHICAGO — Pfizer on Friday said its drug for an advanced form of lung cancer showed promising long-term results in a late-stage trial, which may help establish it as the new standard treatment for the condition.
    The company’s medicine helped patients live longer without seeing their cancer progress, and most people experienced that benefit for over five years. The drug, called Lorbrena, also cut the risk of the cancer progressing in patients’ brains.

    Lorbrena is already approved in the U.S. for treating adults with advanced non-small cell lung cancer who have a mutation in a gene called ALK. Only about 5% of all non-small cell lung cancer patients have the mutation, which causes cancer cells to grow and spread abnormally. 
    But that translates to 72,000 people who are diagnosed with that specific form of lung cancer each year worldwide, according to a release from Pfizer. That cancer is typically aggressive and often affects younger people, the company added.
    More broadly, non-small-cell lung cancer is a common form of the disease.
    Lorbrena is specifically approved as a first-line treatment for that form of lung cancer, meaning patients who take it have not received any other therapy. But Pfizer’s drug isn’t currently considered the standard – or the most appropriate and widely used – treatment for the condition. 
    The company thinks the new five-year data on the drug will change that. 

    “In cancer medicine in general, you always want to give the best medicine upfront first. So that’s why we believe this data … will lead to [Lorbrena] becoming a standard” first-line treatment in this specific form of lung cancer, Chris Boshoff, Pfizer’s chief oncology officer, told CNBC in an interview. 
    The new five-year data is from the same phase three trial that led to Lorbrena’s U.S. approval. Pfizer will present the results on Friday at the American Society of Clinical Oncology annual meeting in Chicago, the largest cancer research conference in the world. The data was also published in the Journal of Clinical Oncology.
    Nearly 300 people in the trial either received Lorbrena or Pfizer’s older lung cancer drug Xalkori. At the five-year mark, 50% of patients in the trial were still receiving Lorbrena compared with 5% of people receiving Xalkori.
    In the trial, Lorbrena after five years cut the risk of cancer progression or death by 81% compared with Xalkori.
    Around 60% of patients treated with Lorbrena were alive without seeing their cancer progress after that same period. That compares with 8% among those who took Xalkori. 
    Dr. David Spigel, chief scientific officer at the Sarah Cannon Research Institute, called those results “the best we’ve ever seen” during a briefing with reporters ahead of the ASCO conference.
    “We have not seen anything close to this. Other great drugs that are available … have not reported the kind of durable, progression-free survival events of this magnitude,” Spigel said, referring to the rate of people who remained alive without seeing their cancer progress. 
    He noted that there are no head-to-head trials that compare Pfizer’s Lorbrena with competing lung cancer drugs, including one called alectinib and another called brigatinib.
    All three are called ALK inhibitors, which are designed to block the mutations in the ALK gene associated with abnormal cancer cell growth. Lorbrena is considered a newer, third-generation ALK inhibitor, while the two competitors are second-generation. 
    But Spigel added that “it’s hard to believe” that Lorbrena would perform worse head-to-head against those drugs.
    Pfizer’s other drug Xalkori is also an ALK-inhibitor, but it is no longer used in the U.S.
    Lung cancers with the “ALK-positive” mutation are also especially adept at spreading to the brain. Roughly a quarter or more of patients can develop brain metastases — when cancer cells spread from their original part of the body to the brain — within the first two years of being diagnosed. 
    Lorbrena slashed the risk of the cancer progressing in the brain by 94% compared with Pfizer’s old drug. Only four of the 114 patients taking Lorbrena developed brain metastases within about 16 months, compared with 39 out of the 109 taking Xalkori.
    Lorbrena is effective at preventing and treating brain metastasis because it can cross a membrane called the blood-brain barrier and enter the brain, something not all drugs can do.
    Spigel called that another “impressive finding” since progression in the brain is “quite awful for patients and something we try desperately to prevent or treat.” 
    No new safety issues were reported for Lorbrena. The most common side effects included swelling, weight gain, cognition and mood changes and high cholesterol in the blood, among others.
    But Spigel called the cognitive issues associated with Lorbrena “unusual” since it is not seen with its competitors.
    In a note on Thursday ahead of the data release, Leerink Partners analyst Dr. Andrew Berens said he believes Lorbrena’s central nervous system side effects are partly why it is often used as a second rather than first-line treatment for this advanced form of lung cancer. Those changes to cognition and mood result “in a lower patient quality of life,” he said.
    But Pfizer’s Boshoff said once physicians use Lorbrena for the first time, they become comfortable managing any specific side effects associated with the drug.
    He noted that educating physicians about how to manage adverse effects will be an important part of Lorbrena’s “relaunch” following the release of the new data.

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