Business

We’re turning the calendar from July to August which means the blockbuster season for movies is coming to a close. But on TV, things are just heating up.
From the “Game of Thrones” prequel to the newest Marvel installment, there’s a lot of highly-anticipated content coming to streaming services this month.

So to help you cut through the noise, we’re highlighting a few of the most notable new releases across top streamers like Hulu, HBO Max, Disney+ and more.

‘Industry’ Season 2 (Aug. 1, HBO)

HBO’s surprise 2020 hit is back for its long-awaited second season which promises even more drama in the cutthroat world of investment banking.

The Sandman (Aug. 5, Netflix)

Author Neil Gaiman’s acclaimed comic is getting a new adaptation this month. The dark fantasy series is reported to have cost as much as $15 million per episode and has a cast that includes “Game of Thrones” stars Gwendoline Christie and Charles Dance.

‘A League of Their Own’ (Aug. 12, Prime Video)

Thirty years after the release of the original classic film, Amazon has adapted “A League of Their Own” into an eight-episode series. Set in in the 1940s, the series follows a group of women setting out to form an all-female baseball team while male players were serving in World War 2.

‘Never Have I Ever’ Season 3 (Aug. 12, Netflix)

Mindy Kaling’s popular high school comedy returns for its third season and will follow protagonist Devi Vishwakumar as she navigates her first relationship.

‘She-Hulk: Attorney at Law’ (Aug. 17, Disney+)

The latest show in Marvel’s growing TV library stars Tatiana Maslany as Jennifer Walters, cousin of Bruce Banner, AKA The Hulk. The nine-episode series will be a courtroom comedy following Walters’ juggling her work as a lawyer with her newly-acquired superpowers.

‘House of the Dragon’ (Aug. 21, HBO)

A little over three years after “Game of Thrones” aired its final episode, HBO is back with a prequel series that it hopes will tap into the popularity that made the original the biggest show on TV. “House of the Dragon” is set 300 years before the events of the original show, and chronicles the downfall of House Targaryen. If the recently-released trailer is any indication, there will be no shortage of dragons.

‘The Patient’ (Aug. 30, FX, Hulu)

From the creators of the critically acclaimed series “The Americans”, “The Patient” stars Steve Carrell as a therapist who is being held prisoner by a serial killer (played by “Star Wars” star Domhnall Gleeson) who wants to curb his murderous urges.

‘Andor’ (Aug. 31, Disney+) More

Fifteen years after its launch, the iPhone “continues to change the world”, said Tim Cook, Apple’s chief executive, as the company reported quarterly earnings on July 28th. It has certainly changed Apple. In an otherwise bumpy week for technology stocks, the world’s most valuable company beat forecasts to report a modest year-on-year increase in revenue. That was in large part thanks to the iPhone, which generated sales of more than $40bn in the latest quarter.Yet as the worldwide smartphone market matures, the iPhone’s dominant role in Apple’s fortunes is diminishing. Whereas at its peak the device made up two-thirds of the firm’s revenue, in the latest quarter its contribution was just under half (see chart). In Apple’s flying-saucer-like headquarters in Cupertino, California, engineers are working on all manner of gadgets that might one day succeed the smartphone. But a big part of Apple’s future is already clear: a growing chunk of revenue and an even larger slice of profits will come not from any product, but from services.For its first three decades Apple Computer made just what its name suggested. In 2006 its Macintosh desktops and laptops were outsold for the first time by something else: the iPod music player earned Apple more revenue. The next year the company launched the iPhone, and dropped Computer from its name. Over the following decade there were times when it could reasonably have been called Apple Telephone: in 2015 iPhone sales amounted to $155bn, twice as much as Apple made from all its other activities combined.Now, after a decade and a half of expansion, the global smartphone market has plateaued, according to idc, a data firm, which also forecasts no growth over the next four years. Apple still has room to increase its market share. Although in America the iPhone accounts for nearly half of smartphone sales, in Europe it makes up more like a quarter, according to Kantar, a research firm. Nonetheless, the years of rocket-powered annual growth are over.Apple has brought in new revenue with other devices. Its AirPods have become the market leader in smart earphones and the Apple Watch is the most successful of its kind. Last year these “wearables” and home accessories contributed a tenth of Apple’s revenue. In 2023 the company is expected to launch its first augmented-reality headset, a technology Mr Cook has described as “profound”. Apple is making interfaces for cars and may one day build the rest of the vehicle, too. Some in the company predict that its forays into health care will eventually rank among Apple’s greatest contributions.As it dreams up more gadgets to sell to more people, however, Apple is employing another strategy in parallel. The company has so far put 1.8bn devices in the pockets and on the desks of some of the world’s most affluent consumers. Now it is selling access to those customers to other companies, and persuading those who own its devices to sign up to its own subscription services. As Luca Maestri, Apple’s chief financial officer, said on a recent earnings call, the Apple devices in circulation represent “a big engine for our services business”. The strategy is picking up speed. Last year services brought in $68bn in revenue, or 19% of Apple’s total. That is double the share in 2015. In the latest quarter services’ share was even higher, at 24%. Apple doesn’t break down where the money comes from, but the biggest chunk is reckoned to be fees from its app store, which amounted to perhaps $25bn last year, according to Sensor Tower, a data provider. The next-biggest part is probably the payment from Google for the right to be Apple devices’ default search engine. This was $10bn in 2020; analysts believe the going rate now is nearer $20bn. Apple’s fast-growing advertising business—mainly selling search ads in its app store—will bring in nearly $7bn this year, reckons eMarketer, another research firm.Most of the rest comes from a range of subscription services: iCloud storage, Apple Music and Apple Care insurance are probably the biggest, estimates Morgan Stanley, an investment bank. More recent ventures like Apple tv+, Apple Fitness, Apple Arcade and Apple Pay make up the rest. New services keep popping up. Last November Apple launched a subscription product for small companies called Apple Business Essentials, offering tech support, device management and so on. In June it announced a “buy now, pay later” service. The company claims a total of 860m active paid subscriptions, nearly a quarter more than it had a year ago.Services are a juicy business. Some, notably tv, are costly for Apple and seem to be partly about burnishing the company’s image (successfully so, if its “best picture” Oscar for “Coda” in March is any indication). Others, though, particularly the app-store business and “Google tax”, contribute handsomely to the bottom line. In the latest quarter Apple’s gross margin on its products was 35%, whereas on services it was 72%. In 2021 services accounted for 19% of Apple’s revenue but 31% of its gross profit.Apple’s business model “is evolving from maximising unit growth to maximising installed-base monetisation”, believes Erik Woodring of Morgan Stanley. He argues that pushing further into services could add another $1trn to the company’s $2.6trn market capitalisation. The average Apple user spends about $10 a month on Apple services (including app-store purchases), much less than they might spend on subscriptions to services like LinkedIn or Peloton, points out Mr Woodring, suggesting plenty of “runway” for growth.For now the market treats Apple as a hardware business. Its shares trade at an 18% discount to tech platforms such as Google’s parent company, Alphabet, and a 49% discount relative to streaming services like Netflix, calculates Morgan Stanley. Apple seems to be nudging investors towards thinking of it as a services firm. It has, for instance, increased disclosures in recent years about its estimated number of “active” devices. Mr Cook declared recently that integrating Apple’s services with its hardware and software was “at the centre of our work and philosophy”. Soon it may even sell its hardware on a subscription basis. In March Bloomberg reported that Apple was working on an iPhone subscription plan, offering regular hardware updates for a monthly fee.Pushing into services carries risks. Consumers are not used to subscribing to devices (though many already pay for their phone in instalments, which isn’t so different). Apple would need to find a way to offer subscriptions without alienating the retailers and mobile-phone operators through which it currently sells 85% of its iPhones, points out Mr Woodring. Services face particularly acute regulatory risks, as European trustbusters circle the app store. And although subscriptions offer steady income, not all services are recession-proof. Apple warned on July 28th that growth in services revenue would decelerate in the next quarter, partly owing to what Mr Cook called the “cloud” hanging over digital advertising.Hardware will probably always be Apple’s main business. It may even be that one of the secret projects in the Cupertino flying-saucer turns into another iPhone-like smash-hit. But with nearly 2bn Apple devices in circulation, there is a big and only partially tapped opportunity to sell people things to do with them. Consumers will doubtless keep buying Apple’s shiny gadgets. From now on, when they do so, they will be acquiring not just swanky new devices for themselves but tiny digital storefronts for Apple. ■For more analysis of the biggest stories in business and technology, sign up to The Bottom Line, our weekly newsletter. More

Analysts have questioned whether Ford’s plan to profitably build 2 million electric vehicles annually by 2026 is realistic, given tight supplies of batteries and skyrocketing mineral prices.
CEO Jim Farley dropped some hints about Ford’s plan to meet its goals during Ford’s earnings call this past week.

Jim Farley, Ford CEO

Electric vehicle batteries are in short supply, and costs for materials such as nickel and cobalt are surging. Yet legacy automaker Ford Motor says it plans to be profitably building millions of EVs a year in just four years.
This week, the Detroit automaker gave investors a little more clarity about how it plans to reach that goal and transform its business built on gas-guzzling cars.

As electric vehicles account for a growing share of the global car market, Ford in March announced it would reorganize its business and separate its internal-combustion engine and electric vehicle efforts. By 2026, it said it expects to build more than 2 million electric vehicles annually — about a third of its total global production — while expanding its operating profit margin.
Wall Street analysts were generally positive about the plan, but some expressed skepticism about the lack of specifics around how the company plans to overcome the supply challenges in the market. Morgan Stanley’s Adam Jonas called it a “stretch” goal and said he lacked confidence in Ford’s ability to secure enough raw materials and tooling to manufacture batteries to even come close to its projection.
Ford addressed some of those concerns in another presentation on July 21, when it told investors that it has secured enough batteries to get to its near-term target: 600,000 EVs per year by the end of 2023. As of now, it said, it has secured about 70% of what it needs to hit its 2026 goal.
Ford promised to share more about how it plans to hit its goals during its annual capital markets day next year. But during its second-quarter earnings call last week, CEO Jim Farley gave some more hints about the automaker’s strategy.

A chance to simplify

Instead of just swapping out internal-combustion engines for batteries and electric motors, Farley has said the company is completely rethinking how it develops its vehicles — and how it keeps them fresh over time.

The company sees a new era where it will be able to freshen its electric vehicles with upgrades to software, batteries and electric motors, much as Tesla does. That means the most costly parts of a vehicle — ‌‍‎‏the sheet metal body panels and the underpinnings that form its overall proportions — won’t have to be changed as frequently.
“We have an opportunity as we go digital with these EVs, to simplify our body engineering and put the engineering where customers really care,” Farley said last week. “And it’s not a different fender. It’s software. It’s a digital display technology. It’s a self-driving system and the [autonomous vehicle] tech. And of course it’s going to be, in some cases, more powerful motors.”
Ford typically redesigns its traditional vehicle models every five to seven years. If it can extend that time by relying on software updates to keep its vehicles fresh, rather than body redesigns, it could save fortunes.
It’s part of how Ford expects to improve its operating margin to 10% by 2026. For its second quarter, the company posted a 9.3% adjusted operating margin. Those results were helped by tight new-vehicle inventories that have allowed Ford to boost its prices.

Fitting dealers into the future

Ford is at a disadvantage to companies like Tesla and EV startups that sell directly to consumers, without dealers acting as middlemen.
The company isn’t planning to eliminate its franchised dealers, which enjoy strong legal protections in many U.S. states that effectively forbid Ford from selling directly to its customers as Tesla does. But Farley said that Ford sees a path to reducing that cost disadvantage — which he estimates at around $2,000 per vehicle — by keeping dealers’ inventories very low and by shifting the way Ford markets its products.
One key to that effort: Ford plans to let customers order its EVs online rather than buying a vehicle from a dealer’s inventory.
As Farley sees it, dealers will have only a few new vehicles on their lots, just enough to offer test drives to customers before they order. Customers will be able to order from the dealership or online “in their bunny slippers,” Farley said, with the dealer making the delivery and providing service after the sale.
Farley estimates that the low dealer inventories and online ordering will make up roughly $1,200 to $1,300 of that $2,000 per-vehicle cost disadvantage, while ensuring that Ford’s dealers remain profitable. The plan will free dealers from having to carry costly inventories, allowing them — in theory, at least — to focus more on service and customer education. That could give Ford an edge that EV makers selling direct won’t be able to easily match.
“I think that’s a different play than the pure EV companies,” Farley said.

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President Joe Biden tested positive for Covid-19 once again after consecutive days of testing negative for the virus, his physician said.
Biden is experiencing no new symptoms and “continues to feel quite well,” Dr. Kevin O’Connor said in a memo shared by the White House.
But he will nevertheless “reinitiate strict isolation procedures,” the presidential physician wrote.

U.S. President Joe Biden speaks to the media as he arrives at Joint Base Andrews, Maryland, U.S. July 20, 2022. 
Jonathan Ernst | Reuters

President Joe Biden on Saturday tested positive for Covid-19 once again after consecutive days of testing negative for the virus, his physician said.
Biden, 79, is experiencing no new symptoms and “continues to feel quite well,” Dr. Kevin O’Connor said in a memo shared by the White House.

But he will nevertheless “reinitiate strict isolation procedures,” the presidential physician wrote.
Biden, who is fully vaccinated and has received two booster shots of the Pfizer-BioNTech vaccine, tweeted Saturday afternoon that he was asymptomatic but would isolate “for the safety of everyone around me.”
“I’m still at work, and will be back on the road soon,” the president’s tweet said.
O’Connor had previously warned of the potential for a “rebound” in positive test results, a phenomenon among a small percentage of patients who, like Biden, used the antiviral medication Paxlovid as part of their treatment.
Biden had accordingly “increased his testing cadence, both to protect people around him and to assure early detection of any return of viral replication,” O’Connor wrote in the latest memo, which was made public Saturday afternoon.

The president tested negative for Covid on Tuesday, Wednesday, Thursday and Friday, but tested positive on Saturday morning from an antigen test. “This in fact represents ‘rebound’ positivity,” the doctor wrote.
Biden’s age puts him at higher risk of getting severely ill from Covid. People over age 65 account for more than 81% of deaths from the virus, which has killed more than 1 million people in the U.S. alone, according to the Centers for Disease Control and Prevention.
The president first tested positive for Covid on July 21. He felt “mild symptoms” including a dry cough, runny nose and fatigue, O’Connor said at the time. Biden began working in isolation but returned to the Oval Office five days later after testing negative for Covid twice over a 24-hour period.
“The President has experienced no reemergence of symptoms, and continues to feel quite well,” O’Connor wrote in Saturday’s memo after Biden’s rebound test. “This being the case, there is no reason to reinitiate treatment at this time, but we will obviously continue close observation.”
“However, given his positive antigen test, he will reinitiate strict isolation procedures. As I’ve stated previously, the President continues to be very specifically conscientious to protect any of the Executive Residence, White House, Secret Service and other staff whose duties require any (albeit socially distanced) proximity to him,” O’Connor wrote.

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JetBlue’s $3.8 billion takeover of Spirit could mean big changes for air travelers.
JetBlue wants to get bigger, and Spirit has the planes and pilots to help it do that.
Despite comedians’ digs, Spirit has improved its reliability in recent years — and is faring better than JetBlue by some measures.

Passengers wait in line at the Spirit Airlines check-in counter at Orlando International Airport.
Paul Hennessy | LightRocket | Getty Images

Spirit Airlines relented this week and agreed to sell itself to JetBlue Airways for $3.8 billion, hours after breaking off a merger agreement with Frontier Airlines that failed to win enough shareholder support.
The new deal would mean big changes for travelers if it passes regulatory hurdles.

JetBlue has earned a reputation for passenger comforts like relatively generous legroom, seatback screens, live television, free Wi-Fi, and complimentary snacks like Cheez-Its and Stellar vegan butter pretzel braids. It also offers business class, with lie-flat seats.
Spirit, by contrast, has become a punchline for its bare-bones service. The cabins in its bright yellow planes are more cramped, and passengers have to pay extra for “optional services” like carry-on luggage and getting to pick a seat.
“It’s historic. This is the first time anyone wanted Spirit Airlines,” quipped “The Late Show” host Stephen Colbert about the deal on Thursday.
Still, Spirit has expanded rapidly and profitably by offering cheap tickets to vacation hotspots that can sometimes run less than a trip to the movies or a few burgers. The airline’s “Big Front Seat,” however, does offer 36 inches of legroom for a surcharge of up to $250.
As the two distinct airlines push ahead with their plans to combine, here’s what passengers can expect:

What are JetBlue’s plans for Spirit?

JetBlue wants to get bigger, and Spirit has the planes and pilots to help it do that. The New York-based carrier plans to retrofit Spirit’s planes in JetBlue’s style, ripping out the packed-in seats for a roomier layout with more amenities.
Combined, the airlines would become the country’s fifth-largest carrier, behind American, Delta, United and Southwest. Both have a big presence in Florida and each has expanded into Central and South America as well as the Caribbean in recent years. JetBlue last year started flying to London.
The two carriers will continue to operate as separate airlines until after the deal closes, which is subject to regulatory approval. Afterward, passengers might be confused if they’re flying in Spirit planes that haven’t been retrofitted yet.
JetBlue has some experience with such situations through its alliance with American in the Northeast, which allows the carriers to sell seats on each others’ planes. Last year, JetBlue revamped its website to better highlight the differences in onboard features like business class seats or free Wi-Fi.
Despite comedians’ digs, Spirit has improved its reliability in recent years — and is faring better than JetBlue by some measures.
JetBlue came in last among 10 airlines in on-time arrivals this year through May, while Spirit ranked seventh, according to the Transportation Department’s latest available data.
So far this year, a third of JetBlue’s flights were delayed and 4% have been canceled, according to flight tracker FlightAware. By comparison, slightly more than a quarter of Spirit’s flights have arrived late and 2.7% have been canceled.
JetBlue’s CEO Robin Hayes says improving reliability is a priority. The carrier has scaled back growth plans, saying it did not want to overextend its crews and other resources.
“A bigger JetBlue that is late is not a better JetBlue,” said Henry Harteveldt, a former airline executive and founder of Atmosphere Research Group, a travel-industry consulting firm.

Is this the end of cheap fares?

The Biden administration has vowed to take a tough stance on both consolidation and inflation, so the disappearance of an ultra low-cost airline could be a tough sell.
“Spirit might not be an elegant experience, but they are cheap,” said William Kovacic, a professor at the George Washington School of Law and a former chair of the Federal Trade Commission. “If they disappear as an independent enterprise … is that going to remove a source of downward pressure on price?”
But JetBlue’s Hayes says the airline needs to grow quickly and better compete with big airlines that control more than three-quarters of the U.S. market. Hayes argues a bigger JetBlue would mean more relatively lower fares to more destinations.
Like some of the airline giants, JetBlue has already added certain low fares that mimic carriers like Spirit. Those tickets also don’t come with seat assignments or other perks that were once standard with a coach fare.
But JetBlue’s business model of offering more comforts costs more than Spirit’s, meaning it likely won’t offer as many of the rock bottom fares that Spirit does.
Frontier Airlines, meanwhile, is already saying it’s happy to take on a bigger share of the ultra-low-cost market after its Spirit deal fell apart. Shortly after the airlines announced the end of their agreement, Frontier projected it would grow 30% next year and started a fare sale with 1 million seats going for $19 apiece.
The airline will become the largest discount carrier in the U.S. if Spirit is ultimately acquired. Others include Allegiant and Sun Country.
“That just gives us a huge amount of breathing room for growth,” said Frontier CEO Barry Biffle. “That’s why this is such a windfall for our employees and our shareholders.”

When is this happening?

Not immediately. JetBlue and Spirit expect the deal won’t get regulatory approval until late 2023 or early 2024, then close in the first half of 2024.
Integrating airlines is a lengthy and costly process. For example, United and Continental flight attendants didn’t even fly together until eight years after those airlines merged in 2010.
Retrofitting planes can take years too, and JetBlue wouldn’t be able to start that process with Spirit’s fleet until at least 2025. But the airline notes it recently outfitted more than 100 of its Airbus planes with new interiors.
“We’ve got a lot of recent experience in how to do it,” said Hayes.

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Club holding AbbVie (ABBV) reported a mixed second quarter Friday morning. On the top line, net revenue increased 6.1% on an operational basis to $14.58 billion, but that missed the consensus estimate on FactSet of $14.67 billion. Adjusted earnings per share increased 11.2% to $3.37, beating estimates of $3.32. Included in earnings was a 14-cent per share unfavorable impact related to acquired in-process research and development (IPR & D) and milestone expense. This is an accounting expense for drug stocks that is now required by the Securities and Exchange Commission. Adjusted operating margin of 51%, which includes an unfavorable 180 basis point impact from acquired IPR & D and milestone expense, was higher than estimates of 50.28%. Bottom line It wasn’t a clean quarter from AbbVie but the broader results were relatively in line with expectations, making Friday’s roughly 5% selloff a bit confusing. Some of this could be due to regular old profit-taking, with the stock still up 5% year to date against an S & P 500, which has dropped about 13%. Frustration around what AbbVie’s 2023 and 2024 earnings will come in (after Humira goes off-patent) played a big role too. Despite the concerns of how shallow (or deep) the earnings trough will look like, management laid out what we believe to be a strong investment case after that. AbbVie believes it will have high single-digit earnings growth in 2025 and beyond, which they called industry-leading, and also the lowest loss of exclusivity exposure in the industry in the second half of the decade. But at the same time, drug pricing reform has been a hot topic lately, and while we cannot completely say if the current rhetoric has more bark than bite to it, this is a risk we must be conscious of. It is disappointing to see ABBV sell off again on earnings day once again, but the quarter and outlook in aggregate look consistent with what management has said previously. We’ll keep this a 2-rating until AbbVie’s dividend yield moves firmly above 4%. Major Q2 segment results AbbVie’s Immunology sales of $7.21 billion, up 19.2% year over year, exceeded the $6.86 billion consensus. Sales within the segment: Humira: $5.36 billion, up 6.8% year over year, versus $5.22 billion expected. Skyrizi: $1.25 billion, up 88.3% year over year, versus $1.08 billion expected. Rinvoq: $592 million, an increase of 60.7% year over year, versus $586 million expected. As a reminder, immunology is a key focus of investors because this is portfolio in transition due to the Humira loss of exclusivity in the United States in the second half of next year. While it is still up to debate how much fast Humira sales will decline in 2023 and 2024, what remains clear is that Skyrizi and Rinvoq have a promising future. First approved by the Food and Drug Administration in April 2019, they have since been gaining clearance for other indications, reflecting the huge year-over-year sales gains. Skyrizi and Rinvoq are performing extremely well and are on pace for approximately $7.5 billion in combined sales this year. Still, it appears that investors are growing frustrated by the lack of clarity around the Humira erosion, partially explaining why ABBV shares sold off Friday. Hematologic oncology sales of $1.65 billion, down 7.9% year over year, missed the $1.81 billion consensus. Sales within the segment: Ibruvica: $1.15 billion versus $1.28 billion expected. Venclexta: $505 million vs. $527 million expected. In aesthetics, sales of $1.37 billion, down 2.1% year over year, missed estimates of $1.512 billion. Sales within the segment: Botox Cosmetic: $695 million versus $664 million expected. Juvaderm: $344 million versus $450 million expected. Other: $332 million versus $391 million expected. The result here was a disappointment for a business that has actually done pretty well since being acquired from Allergan. Weighing on the results this quarter, especially for the Juvederm filler business, were the Covid related lockdowns in China as well as the suspension of operations in Russia. There were some economic pressures in the quarter as well due to the high price point of Juvederm. It is worth noting that management said this has not impacted Botox cosmetics sales to date. Importantly, management continues to expect positive full-year growth for Juvederm driven by easing of Covid restrictions in China as well as two new filler launches in the United States. In neuroscience, sales of $1.66 billion, up 15.2% year over year, was shy of the $1.68 billion consensus. Sales within the segment: Botox Therapeutic: $678 million versus $672 million expected. Vraylar: $492 million versus $537 million expected. Duodopa: $120 million versus $125 million expected. Ubrelvy: $185 million versus $190 million expected. Qulipta: $33 million versus $34 million. Other: $150 million versus $139 million expected. In the eye care segment, sales of $717 million beat the $661million consensus. Sales within the segment: Lumigan: $130 million versus $145 million expected. Alphagan: $92 million versus $115 million expected. Restasis: $168 million versus $87 million expected. Other: $327 million versus $294 million expected. Guidance Turning to the full year outlook, AbbVie now expects total net revenues of approximately $58.9 billion, down from its previous view of $59.4 billion and below estimates of $59.53 billion. There are some moving parts here and we should point out that AbbVie expects a 1.7% unfavorable impact from foreign exchange. From a product perspective, AbbVie raised its Skyrizi global sales outlook by $400 million to $4.8 billon, above estimates of $4.5 billion, due to strong market share performance. This was great news. However, management took down its full year Imbruvica expectations to $4.7. billion, below estimates of $5 billion, due to the lack of recovery in the chronic lymphocytic leukemia (CLL) market and increased competition. On earnings, AbbVie’s outlook was unchanged at $13.78 to $13.98. Keep in mind that this includes a negative impact of 23 cents per share related to IPR & D expense so far this year. The midpoint of this outlook is $13.88, slightly below estimates of $13.89. For the third quarter, AbbVie expects net revenue of approximately $14.8 billion and adjusted earnings per share of $3.55 and $3.59. Analysts had expected sales of $15.27 billion and earnings of $3.66. (Jim Cramer’s Charitable Trust is long ABBV. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

A sign stands outside a Abbvie facility in Cambridge, Massachusetts, May 20, 2021.
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Lunar-focused company Masten Space Systems filed for Chapter 11 bankruptcy protection this week.
The company’s bankruptcy showcases the delicate balancing act required for long-term growth and success in the harsh, capital-intensive space industry.
Masten won a $75 million NASA contract to deliver payloads to the moon’s south pole, but the project ran far over budget and hit Covid pandemic-related obstacles.

Masten Space Systems’ Xombie© lander completes a flight test at the Mojave Spaceport in 2019.
NASA/Lauren Hughes

Lunar-focused company Masten Space Systems filed for Chapter 11 bankruptcy protection on Thursday, with the venture winnowed down to a handful of people after layoffs and furloughs.
The space company declared as its debts ballooned, tracing back to a NASA contract awarded to Masten two years ago. Once seen as a major win for the small business, the NASA deal left Masten over budget, as well as unable to raise funds or pay employees.

Masten predates many of the companies that came up during the past decade’s boom of private investment in the space sector. The company long had a reputation in the industry as a gritty shop for young engineers to cut their teeth on rocket and spacecraft technologies at facilities in the Mojave Desert, near NASA’s Armstrong center and Edwards Air Force Base.
While Masten has a history of demonstrating impressive hardware, the company’s bankruptcy showcases the delicate balancing act required for long-term growth and success in the harsh, capital-intensive space industry. Raising money for high-risk space projects is difficult, and achieving them even more so.
Founded in 2004, Masten regularly won small contracts and prizes to test and develop reusable spacecraft that could takeoff and land, especially for the surface of the moon. The company had an unofficial motto: “Shut up and fly.”
Masten had won a number of NASA contracts – but most notable was the $75 million award in 2020 to deliver eight scientific payloads on a mission to the Moon’s South Pole. At the time of the award, Masten had about 15 people on staff.
The NASA contract was going to be Masten Mission 1, or MM1. It would fly scientific payloads on the company’s Xelene lunar lander, scheduled for 2023. Masten signed a contract with Elon Musk’s SpaceX to launch MM1. People familiar with the matter, speaking anonymously due to the sensitive nature of the matter, told CNBC that Masten began quickly scaling up to build the lander.

But the award was immediately problematic for Masten, as it had written the proposal to NASA before the Covid pandemic struck. The company needed to immediately adjust assumptions about which technologies would be developed in-house, as opposed to purchased, and vendors were unwilling to make commitments due to uncertainty around the new pandemic environment, according to people familiar with the matter.
To avoid going over budget, Masten needed to augment the NASA contract with additional payloads on the missions to hit even aggressive cost estimates. But the total MM1 budget still ended up exceeding cost expectations. As development continued, Masten anticipated the mission would be anywhere from $10 million to $30 million over budget, those people said.
In early 2021, Masten’s board and senior management began an effort to raise up to $60 million in outside capital. The company previously had raised little else than small sums from angel investors. But the effort never found a lead investor, and Masten remained on a knife’s edge. The company operated in survival mode for most of its existence, living contract-to-contract and re-investing any profits into the business. The new paradigm added a new level of pressure.
Masten last year scaled up to about 120 employees and contractors on staff, but the lack of funds and mounting debt stifled further progress. The board of directors effectively removed CEO Sean Mahoney in January. People familiar with the situation said a Covid-related NASA payment of $1.4 million in February merely kept the company solvent a little longer. NASA distributed funds as a part of the broader federal disaster relief program to U.S. businesses.
The company then laid off 20 people in June, those people said, with 15 from the MM1 team specifically. In July, Masten furloughed nearly all the remaining employees at the company, as reported by Mojave-based blog Parabolic Arc and confirmed by CNBC.
A NASA spokesperson wrote in a statement to CNBC that the agency “received notification its payloads slated for delivery aboard Masten Mission One may be impacted by Masten business operations.”
“In the event Masten Space Systems is unable to complete its task order, NASA will manifest its payloads on other CLPS flights,” the agency said.
To date, NASA has paid $66.1 million of the contract for Masten’s mission.
The company has between 50 and 99 creditors, according to Thursday’s filing, and estimates its assets are worth between $10 million and $50 million, with debts between $10 million to $50 million.
SpaceX has the largest unsecured claim to Masten’s debt, with $4.6 million unpaid as a vendor. A number of suppliers and other space companies are listed as large creditors – such as Airbus and Astrobotic – with debts each of $500,000 and up.
Masten’s filing specified that, among its property, immediate attention is needed for explosive and hazardous chemicals. Intuitive Machines, another lunar-focused company, gets first dibs on Masten’s launch contract with SpaceX, as a result of a “stalking horse asset purchase agreement.”
A Masten representative did not respond to CNBC’s request for further comment on the bankruptcy.

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Conquering the world of blockbuster television was never part of ‘Stranger Things’ cinematographer Caleb Heymann’s plan.
The filmmaker spent most of his 20s in South Africa, where he attended film school and later built a modest career shooting commercials and small films. But after winning a special jury prize at the 2016 Sundance Film Festival, Heymann signed with a Los Angeles-based agency and moved back to the United States.

“I was struggling the first year and a half in LA,” Heymann tells CNBC Make It. “I was 34 at the time and I felt like I was pretty much starting over.”
He describes a period of time where he was taking film work wherever he could get it, but always trying to collaborate with other artists whose craft he admired.
“You’re not really in control of [how much success you have], but you are in control of who it is that you’re working with,” he says. “Make sure that you’re always working with people that you respect and projects that kind of speak to you on some level personally.” 
His foray into the Upside Down and the world of ‘Stranger Things’ came almost completely by accident, and Heymann says that his big break “was not a strategic move.”

I felt this massive impostor syndrome at first because I’d never been on any big staff like that where you’ve got hundreds of people working on the production.

Caleb Heymann
Director of Photography, ‘Stranger Things’ season 4

The Netflix hit was looking for second-unit directors for its third season, and creators Matt and Ross Duffer had seen a short film Heymann worked on which was directed by a writer on the show. The Duffer brothers reached out to Heymann, who called the phone call “life-changing.”

“When I got the call to come do second unit for season three, I was thrilled beyond belief,” he says. “But I also felt this massive impostor syndrome at first because I’d never been on any big staff like that where you’ve got hundreds of people working on the production.” 

Heymann, who got his start in film by shooting documentaries, was quickly thrown into the deep end of large-scale productions. Despite working as a director of photography, he wasn’t operating any of the cameras himself.
“[The job became] much more about how you’re coordinating the vision by working with the director and this massive army [of crew] that’s at your disposal,” he says.
Still, Heymann impressed the Duffers enough that he was invited back for season four, where he lensed seven of the season’s nine episodes. The popularity of this season, which Netflix this month announced has been viewed for well over 1 billion hours, is something that Heymann says “really boggles my mind.”
The work has also opened more doors for him — he is about to embark on another project for a massively popular media property.
“I’m going to be starting on a project for Marvel within a few weeks that I’m extremely excited about,” he says. “It’s all because of ‘Stranger Things’ and it’s all because of the Duffer brothers taking a chance to bring me onboard.”
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