Business

Activist investor Carl Icahn on Monday reported a nearly 10% stake in JetBlue Airways, saying the airline stock is undervalued.
Icahn has had plans to continue discussions with the company “regarding the possibility of board representation,” filings said.
JetBlue has been cutting costs and working to improve operations in an effort to return to profitability after a post-Covid travel surge and a blocked merger with budget carrier Spirit Airlines.

Carl Icahn at the 6th annual CNBC Institutional Investor Delivering Alpha Conference on Sept. 13, 2016.
Heidi Gutman | CNBC

Activist investor Carl Icahn on Monday reported a nearly 10% stake in JetBlue Airways, saying the airline stock is undervalued. Shares of JetBlue spiked more than 15% in extended trading.
Icahn amassed the stake in a series of purchases in January and February, according to regulatory filings. He has had plans to continue discussions with the company “regarding the possibility of board representation,” the records said.

JetBlue said in a statement, “We are always open to constructive dialogue with our investors as we continue to execute our plan to enhance value for all of our shareholders and stakeholders.”
Representatives for Icahn were not immediately available to comment.
This is not Icahn’s first investment involving the airline industry. In one of his more infamous activist campaigns, the corporate raider took TWA private in the late 1980s, only to see the airline struggle and file for bankruptcy.
JetBlue has been cutting costs and working to improve operations in an effort to return to profitability after a post-Covid travel surge and a blocked merger with budget carrier Spirit Airlines. A federal judge last month ruled against a combination of the two airlines, citing reduced competition.
JetBlue had argued it needed the tie-up to help it compete against the largest American carriers. JetBlue and Spirit are appealing the judge’s ruling.

In the past 12 months, JetBlue’s stock is down more than 27% as of Monday’s close. The NYSE Arca Airline Index, which tracks the broader sector, is up nearly 7% during the same period.
JetBlue’s new CEO, Joanna Geraghty, took the helm Monday, and the carrier has appointed a pair of airline veterans to get it back on track.
— CNBC’s John Melloy and Leslie Josephs contributed to this report.Don’t miss these stories from CNBC PRO: More

Incoming CEO Joanna Geraghty will have to address JetBlue’s reliability and cost-control problems.
The airline is still losing money while larger airlines have returned to profitability post-pandemic.
A federal judge blocked JetBlue’s plan to buy Spirit Airlines for $3.8 billion last month, forcing both carriers to plan for a future on their own.

A JetBlue Airways plane prepares to depart New York’s LaGuardia Airport.
Leslie Josephs | CNBC

In the 24 years since JetBlue Airways’ first flight, the New York-based airline has pushed the envelope for a carrier of its size. Now, with some veteran executive hires and cost-cutting, it’s trying to get back to basics.
JetBlue was a pioneer in seat-back entertainment, free Wi-Fi, good snacks and a business-class cabin with lie-flat seats that debuted at lower prices than rivals’. More recently, it’s ventured across the Atlantic with flights to London, Paris, Amsterdam and Dublin. And, until a judge blocked the deal last month, it planned to buy budget airline Spirit Airlines for $3.8 billion. (The carriers are appealing that decision.)

While JetBlue has never lacked big ideas, it has come up short on profits, cost control and reliability. Those challenges will be top of mind for incoming CEO Joanna Geraghty when she takes the helm on Monday, succeeding Robin Hayes.
And the pressure is on: On Monday afternoon, activist investor Carl Icahn disclosed a nearly 10% stake in the company and said he would pursue discussions around board representation.

Geraghty, 51, has been at JetBlue for nearly two decades, most recently as president and chief operating officer. By naming her CEO, the company is promoting an insider who knows the complexities of running an airline with quirks like New York’s congested airspace.
She’s the first woman to lead a U.S. passenger airline.

Joanna Geraghty, president and chief operating officer of JetBlue Airways Corp., speaks during a panel session at the World Aviation Festival in London, U.K., on Thursday, Sept. 5, 2019.
Chris Ratcliffe | Bloomberg | Getty Images

“The key strategic challenge we’ve always faced is how to thrive as a small player in an industry dominated by four large airlines,” Geraghty said on a Jan. 30 earnings call, referring to American, Delta, United and Southwest, which control about 80% of the domestic market.

Last week, JetBlue said it has hired back the airline’s former chief commercial officer, Marty St. George, 59, as president. St. George left the carrier in 2019 after 13 years and most recently worked at Latam Airlines as chief commercial officer. St. George, who also had previous posts at United Airlines and US Airways, is well regarded by industry watchers for his experience and good relationship with front-line workers.
“Marty will be a much needed force of good for JetBlue for improving the airline’s operational focus and reliability,” said Henry Harteveldt, a former airline executive who runs the consulting firm Atmosphere Research Group. “Legroom doesn’t matter, snacks don’t matter if your schedule can’t be trusted.”
Tyesha Best, president of the Transport Workers Union Local 579, which represents JetBlue’s roughly 6,000 flight attendants, said members were “hopeful” because of St. George’s return but that the airline needs urgent improvements to crew scheduling and staffing, particularly for the business-class Mint cabin.
“Our quality of life still isn’t where it needs to be,” Best said.
JetBlue also promoted Warren Christie, 57, who previously was the head of safety, security, fleet operations and airports, to take over Geraghty’s role as COO.

Back to basics

Geraghty, whom JetBlue declined to make available for an interview, will have to convince investors and customers about the company’s turnaround.
JetBlue’s last annual profit was in 2019, before the pandemic. Wall Street analysts aren’t forecasting it will turn a profit until 2025, while other carriers have already returned to profitability in the post-Covid travel surge. JetBlue’s shares are down 29% over the last 12 months, while the NYSE Arca Airline index is up nearly 6% over that period.

JetBlue ranked ninth in punctuality for U.S. airlines from January through November 2023, with less than 67% of its flights arriving on time, according to the Department of Transportation.
“As we operate in one of the most complex and challenging airspaces, operational reliability is foundational to all of our priorities, helping us deliver a better customer experience while also improving revenues with fewer refunds and disruption vouchers and better costs as we mitigate overtime and premium pay,” Geraghty said on the earnings call.
The company plans to outline the $300 million in new revenue initiatives in more detail during an investor day in May, and said last month that it is on track to cut as much as $200 million in costs by the end of the year.
“We’ve been given the appetizer but the main course isn’t until investor day,” said Brett Snyder, president of Cranky Concierge travel assistance company and the Cranky Flier site. “They’re hiring the right people. I am cautiously optimistic for the first time in years.”

Stock chart icon

Airline stocks

JetBlue has recently announced some cost cuts: offering staff buyouts, deferring some capital expenditures on aircraft, trimming unprofitable routes, and reducing frequencies on some routes to prioritize planes for moneymakers like premium leisure travel and the steady business from customers visiting friends and relatives.
Snyder said that JetBlue will need to take a long, hard look at its network to cut what isn’t working, and to make hard decisions, like putting more slack in the system to improve the operation.
“Customers expect good service, and when they don’t get it, they’re vocal about it,” Geraghty said in an interview with CNBC in 2019. She said the airline at the time was “exiting that awkward teenage stage and becoming adults.”

Spirit up in the air

JetBlue’s most aggressive expansion was its pursuit of budget carrier Spirit Airlines. It made a surprise offer for the carrier in April 2022 when Spirit had already agreed to merge with fellow discounter Frontier Airlines.

A JetBlue Airways plane sits on the tarmac at the Fort Lauderdale-Hollywood International Airport on January 31, 2024 in Fort Lauderdale, Florida.
Joe Raedle | Getty Images

Spirit shareholders eventually rejected the cash-and-stock deal with Frontier and voted in favor of JetBlue’s acquisition of Spirit, a deal JetBlue argued it needed to better compete against rivals when aircraft and space are limited for growth in the U.S.
The Justice Department sued to block the deal in March 2023, arguing it would reduce competition, and in January a federal judge sided with the DOJ.
JetBlue and Spirit said they are appealing the ruling, though analysts are skeptical about a reversal. Investors have appeared relieved so far that JetBlue wouldn’t be paying $3.8 billion for Spirit, which had a market capitalization of $726 million as of Friday’s close.
Spirit executives last week sought to calm fears about the airline’s future potentially without a JetBlue takeover, even as Spirit navigates rocky financial footing, partially due to a Pratt & Whitney engine recall that is grounding dozens of its planes.
Geraghty last month said JetBlue disagrees with the judge’s ruling to block the merger and added if the airlines don’t win their appeal, “We need to be prepared with our organic plan.”
Don’t miss these stories from CNBC PRO:

Correction: An earlier version of this story included a chart that misstated JetBlue’s 2020 financial performance. More

Last year, Bezos announced on Instagram that he was leaving Seattle after nearly 30 years to move to Miami.
In 2022 Washington state imposed a new, 7% capital gains tax on sales of stocks or bonds of more than $250,000.
Bezos plans to unload 50 million shares of Amazon before Jan. 31, 2025. Posting those sales in Florida will save him at least $610 million.

Jeff Bezos and Lauren Sanchez walk in the Paddock prior to final practice ahead of the F1 Grand Prix of Miami at Miami International Autodrome on May 06, 2023 in Miami, Florida. 
Clive Mason | Formula 1 | Getty Images

Jeff Bezos’ $2 billion stock sale last week came with an added perk: no state taxes.
Last year, Bezos announced on Instagram that he was leaving Seattle after nearly 30 years to move to Miami. He said the move was to be closer to his parents and his rocket launches at Blue Origin. The timing also suggested another reason: taxes.

In 2022 Washington state imposed a new, 7% capital gains tax on sales of stocks or bonds of more than $250,000. Washington state doesn’t have a personal income tax, so the new levy marked the first time Bezos would face state taxes on his stock sales.
Starting in 1998 Bezos sold billions of dollars worth of Amazon shares almost every year for more than two decades to fund his philanthropy, his space company Blue Origin, and more recently his $500 million mega yacht and a growing collection of mansions purchased with his fiancé Lauren Sanchez.
In 2022, when the tax took effect, Bezos stopped selling. He didn’t sell any Amazon stock in 2022 or 2023, gifting only $200 million of shares at the end of last year.
After his move to Miami, Bezos made up for lost time. Last week, a filing with the SEC revealed that Bezos launched a pre-scheduled stock-selling plan to unload 50 million shares before Jan. 31, 2025. At today’s price, that would total more than $8.7 billion.
Florida has no state income tax or a tax on capital gains. So on the $2 billion sale last week, he saved $140 million that he would have paid to Washington state. On the entire sale of 50 million shares over the next year, he will save at least $610 million. And that’s assuming Amazon shares remain flat. If they continue to rise, the value of his shares — and his tax savings — will be even higher.

Put another way, he’s more than paid for his 417-foot yacht, Koru, with just his Florida tax savings.
For his new digs, Bezos purchased two mansions in Indian Creek for $147 million and is reportedly looking at three other properties on the island, which also counts Tom Brady and Carl Icahn as residents. Miami brokers say Bezos is likely to tear down the homes and build a new one, with the total costs of the new estate likely topping $200 million.
Don’t miss these stories from CNBC PRO: More

As domestic travel rebounds from pandemic lows and prices soar, some travelers opting for trains over planes.
Trains are often cheaper, provide more leg room and are better for the environment than air travel.
Amtrak is trying to revive pre-Covid ridership and smooth out operations.

Amtrak trains travel through Washington, DC, on September 15, 2022.
Stefani Reynolds | AFP | Getty Images

As domestic travel rebounds from pandemic lows and prices soar, some travelers opting for trains over planes.
For many, the tradeoffs are simple: Trains are often cheaper, provide more leg room and are better for the environment than air travel. Those advantages and others are driving riders to Amtrak, the government-backed U.S. rail service, as it tries to revive pre-Covid ridership and smooth out operations.

Since emerging out of the pandemic, airline ticket prices have skyrocketed as travel demand surged. On top of that, uncertainty in the airline industry has ballooned in part due to high-profile incidents, like one that commanded headlines earlier this year when a section of an Alaska Airlines plane blew off mid-flight, leading to the discovery of loose hardware on Boeing 737 Max 9 planes in multiple airlines’ fleets.
Though train routes often take longer than flight times, the total travel time usually evens out when factoring in traffic to get to the airport, time spent in security lines and boarding wait times, according to Clint Henderson, a managing editor at travel site The Points Guy.
“We’ve done speed tests and measured the amount of time it takes to go between cities like New York and D.C. on the train versus the plane, and even though the flight is super short, it generally takes around the same amount of time,” he said.
Trains will likely never render flying obsolete, but Henderson said he’s seen an increase more broadly across the travel industry in the number of people choosing to take Amtrak trains over flights, especially in the Northeast corridor, where flying between two close-by cities doesn’t always make sense.
One of those passengers is Leonor Grave, who lives in New York City and often travels home to Washington, D.C., on Amtrak trains rather than flying. Grave said she particularly likes that train stations are typically in city centers, as opposed to airports, which are often on the outskirts of towns.

“If trains were faster and reached more destinations, I don’t think I would ever fly domestically,” Grave said. “It’s such a frictionless way to travel… and I just find it a lot more enjoyable on the train – you can get up, you can walk around, stretch your legs, you can go to the food car. You feel a lot more grounded.”
Grave said she’s even been able to bring her bike on the train and arrive at New York’s Penn Station just 20 minutes before the train’s departure, as opposed to having to arrive to an airport the typical two hours early. While she’s experienced some delays on Amtrak trains, especially post-pandemic, she said they’ve been negligible compared to flight delays and cancellations that have recently plagued the air travel industry.
“I don’t glamorize Amtrak as a corporation – there’s a lot they could do to improve its services,” Grave said. “Even though Amtrak isn’t perfect, I think it’s the best option of what we have. The more that rail becomes competitive with flying and the more people take the train, the more we can develop these train routes and connect different places across the rest of the country. It’s an exciting future for train travel.”

Reasons for rail

American trains are still nowhere near the high-speed railroad networks of Europe or Japan, for example. (Though Amtrak’s Acela trains can reach 150 miles per hour in sections of its route.)
Nonetheless, the option is increasingly attractive to some travelers as the dynamics of travel shift.
Twenty-two-year-old Chiara Dorsi booked a 19-hour Amtrak ride from Chicago to New Orleans this month rather than hopping a flight. The rail ticket saves her the hassle of dealing with bag limits and going through security. It also saved her nearly $400, and allows her to work during the ride.
“The price was just astronomically different,” she said. “And I’m working remotely and Amtrak has Wi-Fi, so the time I’m wasting on the train isn’t actually wasted because I can do my work from anywhere.”
Dorsi also said she tends to gravitate toward trains for their environmental benefits.
According to the International Air Transport Association, air travel accounts for roughly 2% of the world’s global carbon emissions. That travel impact is significantly lower when substituted with train travel, according to Aaron McCall, the federal advocacy coordinator at California Environmental Voters.
Whenever there’s communal travel, the emissions are bound to be reduced, McCall said.
“We are seeing a decrease in greenhouse gas emissions across the board, and the reason why we’re seeing that decrease is directly connected to investment in green technology and public transportation,” he said.
McCall said he’s even seen more people take Amtrak trains in California recently, where public transportation significantly lags behind the robust networks of the East Coast.

Ridership returns, with delays

Amtrak reported total ridership of over 28 million in 2023, a 24% increase from the year prior – but still down significantly from a pre-pandemic total of over 32 million passengers in 2019.
It saw particular bounce-back in its ridership and revenue along the Northeast Corridor — spanning Washington, D.C., to Boston — with a more than 22% increase year over year, according to a November report.
But the trains’ on-time performance has taken a hit since the pandemic, according to a 2022 report from the Bureau of Transportation Statistics. In 2019, Amtrak operations had an overall on-time performance of 75%, on a weighted basis, according to the BTS. In 2020 and 2021, as ridership cratered, that on-time performance improved to 80% and 78%, respectively.
As of 2022, the latest data encompassed in the report, total delays rose again and on-time performance sank to 74%, according to the report. Much of those disruptions were the result of issues with host railroads, rather than the fault of Amtrak, but the company said it remains committed to finding ways to decrease disruptions.
“Throughout the Amtrak national network, we work around-the-clock to ensure reliable service and safety during inclement weather,” Amtrak told CNBC. “We have our own team that monitors weather conditions and assessing the state of the railroad and related infrastructure in real-time.”
Amtrak has also been building out its longer routes, bolstered by fresh funding from the White House to upgrade trains and build out more infrastructure between cities. In an effort to double ridership by 2040, the company is investing over $5 million into a program aimed at enhancing train stations, tunnels and bridges.
Those upgrades will be the key “gamechanger” in revolutionizing train travel, according to Henderson of The Points Guy – even if the timeline is looking long.
“They’re reinforcing the track beds in some places, rebuilding bridges, and these trains will be able to run faster,” Henderson said. “Once those start rolling out, it’s going to be exciting … I just urge people to be patient because it’s going to take a while before these things are full reality.” More

Gordon Pointe is a roughly 9-acre compound in Naples, Florida, in an affluent enclave called Port Royal.
The mega-listing includes a main house that spans about 11,500 square feet on a private peninsula.
The listing is already drawing significant interest, according to a co-listing agent, despite what may be a high asking price.

The main house at Gordon Pointe spans 11,500 sq ft.

The most expensive home for sale in the U.S. hit the market this week for $295 million.
Gordon Pointe, as it’s called, is a roughly 9-acre compound in Naples, Florida, on the Gulf Coast, in an affluent enclave called Port Royal.

The mega-listing includes a main house that spans about 11,500 square feet, with six bedrooms. Two guest houses, each over 5,000 square feet, bring the estate’s total interior living space to 22,800 square feet. All three homes are on a peninsula that delivers 1,650 feet of waterfront, a private yacht basin and T-shaped dock.
Before you start counting up bedrooms and calculating the price per square foot (which is about $12,900), co-listing agent Leighton Candler of Corcoran told CNBC the value here isn’t so much about the size of the three grand homes on the property, it’s about privacy, beach frontage and a rare opportunity for significant development.
According to a press release that launched the listing, “The property can accommodate more than 200,000 square feet of residential development,” meaning the land has a ton of untapped potential.
“There can be eight waterfront homes on this property,” Candler told CNBC. While the property could be broken apart after purchase, the New York-based broker speculates a potential buyer will more likely maintain it as a private family compound.

Gordon Pointe’s sandy white beach stretches over 700 feet on the Gulf of Mexico.

The nine acres are made up of contiguous lots, the first of them purchased in 1985 by John and Rhodora Donahue. John Donahue co-founded a Pittsburgh-based investment management firm, now known as Federated Hermes, with over $758 billion in assets under management, according to the firm’s website.

The waterfront view of the main house and a stretch of beach on Gordon Pointe.

After that first purchase in 1985, the Donahues continued to buy up more of the peninsula and didn’t stop until they owned it all. Their buying spree created an exclusive, gated compound almost entirely surrounded by water. A single private drive means no pesky through traffic.
“It gives you all the benefits of being on an island, but on Gordon Pointe your family can be secluded without feeling isolated,” Candler said.
Along with a T-shaped dock that can accommodate six boats, the Donahues also constructed a private yacht basin that’s 231 feet by 50 feet and has a depth of almost 8 feet. Candler told CNBC it’s a rare amenity that had to be approved by the U.S. Army Corps of Engineers.

A view of Gordon Pointe with the private yacht basin in the lower right corner.
Dawn McKenna Group / Coldwell Banker Realty

Can Gordon Pointe fetch $295 million?

According to Realtor.com the median listing price in Port Royal is $24.1 million.
The highest-priced home, before Gordon Pointe, in the ultra luxe beachfront community hit the market in December at $45 million, or just under $4,300 per square foot. Meanwhile an empty lot of almost 1.5 acres adjacent to Gordon Pointe has been on the market for a year, at an asking price of $63 million.
“We did our best to price [Gordon Pointe] and we can defend that price all day long,” co-listing agent Dawn McKenna of Coldwell Banker Realty told CNBC.
McKenna said the listing is already drawing significant interest since it went live Wednesday and that she’s already booked eight in-person visits with prequalified buyers.
It’s no surprise to hear listing brokers argue an eye-popping price tag is justified, but true comparisons at this level and buyers with enough cash to pay that kind of money are few and far between. And, as is the case with any real estate listing, there can be a big gap between an initial asking price and what a property ultimately sells for.
For some nine-figure context, here’s a closer look at the second- and third-most-expensive listings currently for sale in America.

A view of the Central Park Tower at 217 West 57th St. in New York City.
Source: Cody Boone, SERHANT Studios

The first of the two listings is a penthouse that debuted in New York City in September 2022.
The residence sits high atop 217 West 57th Street, overlooking Central Park, spanning three floors and over 17,500 square feet.
Broker Ryan Serhant made headlines when he listed the mega-apartment at $250 million, which he told CNBC at the time was the appropriate price.
“I know it sounds crazy, but relatively speaking, it’s priced at a great value on a per-square-foot basis,” Serhant said in 2022. “It’s just a very, very big apartment with lots of amenities.”
But naysayers questioned the nosebleed asking price, which amounted to over $14,000 a square foot.
“I consider this a fantasy price,” Manhattan luxury broker Donna Olshan told CNBC in 2022.
The triplex residence sat on the market for 12 months with no takers. After a yearlong run at $250 million, the asking price was slashed by $55 million, or 22%. The pricey pad is still on the market for $195 million.

Inside the $250 million penthouse on ‘Billionaires’ Row’

It was a similar journey in Los Angeles, with the seven-bedroom 20-bath mansion known as Casa Encantada.
The mansion, located at 10644 Bellagio Road in Bel Air, is owned by children’s book author Karen Winnick, the widow of late billionaire and financier Gary Winnick.
The residence hit the market in June for $250 million.
After the sky-high ask failed to lure a buyer, the home was taken off the market only to reappear in November with a $55 million price cut.
Listing agent Kurt Rappaport is still looking for a buyer willing to pay the $195 million.

Nine-figure whisper sales

The reality is nine-figure listings can take months, even years, to sell, and that’s not necessarily a reflection of a broker’s ability.
Real estate consultant Jonathan Miller, president of Miller Samuel, looked at 10 U.S. home sales that traded for $150 million or more and found many of them were so-called whisper listings — sales that leveraged hushed word-of-mouth marketing and no public real estate listings or marketing campaigns.
That makes tracking price changes over the life of the listings nearly impossible.

Jeff Bezos gives a thumbs-up as he speaks during an event about Blue Origin’s space exploration plans in Washington, D.C., May 9, 2019.
Clodagh Kilcoyne | Reuters

But perhaps unsurprisingly there are a lot of famous billionaires involved in these sales, including hedge funder Ken Griffin, Amazon founder Jeff Bezos, Oracle co-founder Larry Ellison and mega-investor Marc Andreessen, who each picked up nine-figure compounds in quiet off-market deals.

The Chartwell Estate in Los Angeles
Photograph by Jim Bartsch, courtesy of the Estate of Jerry Perenchio

One notable mega-mansion of the 10 transactions compiled by Miller did officially come to market and has an interesting price history.
In 2017 the mansion at 750 Bel Air Road in Los Angeles, known as the Chartwell Estate, had a $350 million price tag. It sat on the market with no bites, and the oversized asking price took several deep cuts, to $195 million.
In 2019 the estate finally sold for $150 million, purchased by Lachlan Murdoch, executive chair and CEO of Fox Corp. and son of media mogul Rupert Murdoch.

Take a look inside of Lachlan Murdoch’s new $150 million LA mansion

And another interesting mega-transaction made the list: A Malibu mansion located at 27712 Pacific Coast Highway. While it never actually had a public listing, The Wall Street Journal reported its whispered price tag was $295 million.
When it sold in 2023 in an off-market deal to music power couple Jay-Z and Beyoncé, it went for $190 million. More

The insatiable demand for weight loss drugs is outpacing supply, leaving many patients struggling to get their hands on the injectable treatments. 
Dominant weight loss drugmakers Novo Nordisk and Eli Lilly are showing encouraging progress in their efforts to increase supply. 
Both drugmakers have recently given positive supply updates, aiming to reassure investors that they can capitalize on the success of their drugs and reassure patients that they can access them.

Injection pens of Novo Nordisk’s weight-loss drug Wegovy are shown in this photo illustration in Oslo, Norway, Nov. 21, 2023.
Victoria Klesty | Reuters

The insatiable demand for weight loss drugs is trouncing supply, leaving many patients struggling to find the injectable treatments. 
The dominant weight loss drugmakers, Novo Nordisk and Eli Lilly, have said supply woes likely won’t go away anytime soon, as the popularity of those medicines continues to soar. But both companies are showing encouraging progress in their efforts to increase supply. 

“I think it’s going to take a few years for it to resolve itself,” Cantor Fitzgerald analyst Louise Chen told CNBC of the supply issues. “But I think both companies will slowly start to meet the demand in the market.” 
Patients have flocked to weight loss drugs such as Novo Nordisk’s Wegovy and Eli Lilly’s Zepbound as the treatments help them shed significant pounds over time, despite the drugs’ hefty price tags, mixed insurance coverage and handful of unpleasant side effects.
Goldman Sachs analysts expect 15 million U.S. adults to be on obesity medications by 2030. Some Wall Street analysts project that the weight loss drug market could be worth $100 billion by the end of the decade.
As demand spikes, most of the drugs have slipped into intermittent shortages. But there is limited data available on how significant shortages are or how much supply companies have.
“I hear all the time about patients going to pharmacies that just don’t have it in stock for them, especially since the summer,” said Dr. Jeff Friedman, the director of bariatric surgery at the University of Florida, who also prescribes obesity medications.

But both Novo Nordisk and Eli Lilly gave updates on positive supply developments to investors over the last week. They rounded out 2023 with a handful of new investments in expanding production capacity for their weight loss and diabetes drugs.
Those efforts aim to reassure anxious investors that they can capitalize on the success of the treatments and to reassure patients that they can access the treatments. Novo Nordisk and Eli Lilly look to maintain their edge in the market as other companies such as Amgen, Pfizer, AstraZeneca, Roche and smaller obesity drugmakers race to join the space. 

Drugmakers kick off 2024 with supply progress 

Novo Nordisk last week said it had more than doubled its supply of lower-dose versions of its weight loss injection Wegovy in January compared with previous months, which will allow more people to start taking the drug. Shortages have forced Novo Nordisk to restrict the availability of those lower “starter” doses in the U.S. since May. 
There is still “limited availability” of 0.25, 0.5, 1 and 1.7-milligram doses of Wegovy, according to a Monday update on the Food and Drug Administration’s drug shortage database. Patients typically start on the 0.25-milligram dose and increase the size over time to mitigate side effects such as nausea. 
Novo Nordisk plans to gradually increase Wegovy supply the rest of the year, executives said on the company’s fourth-quarter earnings call last week.

An Eli Lilly and Company pharmaceutical manufacturing plant is pictured in Branchburg, New Jersey, March 5, 2021.
Mike Segar | Reuters

Certain doses of Eli Lilly’s diabetes drug Mounjaro, which uses the same active ingredient as Zepbound, also have limited availability, according to the FDA. Both treatments are incretin drugs, which mimic gut hormones to suppress appetite and regulate blood sugar.
Still, Eli Lilly achieved its goal of doubling production capacity for such incretin drugs by the end of 2023, executives said during the company’s fourth-quarter earnings call Tuesday. They said the company will expand production with “equal urgency” this year, with the most significant production increases occurring in the second half of the year. 
By that point in the year, the company expects its production of sellable doses of incretin drugs to be at least 1.5 times higher than it was in the second half of 2023, executives said.

Catalent deal could boost Wegovy supply

Novo Nordisk and its parent company, Novo Holdings, unveiled multibillion-dollar deals that could increase Wegovy supply — just not yet.
Novo Holdings on Monday said it will acquire drug manufacturer Catalent in a $16.5 billion deal. Catalent is the main supplier of fill-finish work, which involves filling and packaging syringes and injection pens, for Wegovy. 
Novo Nordisk will then buy three of Catalent’s manufacturing sites from Novo Holdings for $11 billion. Novo Nordisk said that purchase will gradually increase the company’s manufacturing capacity starting in 2026. 

A general view of the drug product manufacturing laboratory in biologics and sterile injectables, Catalent, in Brussels, Belgium June 27, 2023. REUTERS/Yves Herman
Yves Herman | Reuters

In a note Tuesday, TD Cowen analyst Michael Nedelcovych wrote the Catalent deals will likely “boost production faster” than building entirely new plants or adding more production lines to existing sites, moves Novo Nordisk is still pursuing. Those efforts are more “expensive and time consuming” than the acquisition, he noted.
Eli Lilly CFO Anat Ashkenazi told investors during an earnings call Tuesday that the company has concerns about Novo Holdings’ acquisition, especially since Eli Lilly contracts Catalent to manufacture some of its medications. 
But Eli Lilly has said it doesn’t have meaningful production coming from Catalent, so the acquisition may have little effect on its business, Cantor Fitzgerald’s Chen said.

New plants could increase long-term supply 

Novo Nordisk and Eli Lilly have both poured billions into building new production sites that could boost supply of their weight loss and diabetes drugs in the coming years. 
On Tuesday, Eli Lilly said a new plant in Concord, North Carolina, will start production of incretin drugs as early as the end of the year, with products available to ship in 2025. 
In a note Sunday, Morgan Stanley analysts said they expect that facility and one in North Carolina’s Triangle Park, which started production last year, to help the company significantly increase its capacity for supplying autoinjector forms of Mounjaro, Zepbound and Eli Lilly’s other diabetes drug Trulicity. Autoinjectors are the traditional delivery devices of those medicines.
The company also will build a handful of other facilities over the next few years. Eli Lilly in November said it would spend $2.5 billion to open a manufacturing site for injectable products in Germany, with construction beginning this year.
The drugmaker has also invested more than $3 billion to build two new production facilities in its home state of Indiana. 
Meanwhile, Novo Nordisk in November said it would invest $6 billion to expand its manufacturing sites in Denmark, noting it will finish construction from the end of 2025 through 2029. The company also said it would spend around $2.3 billion to build out another production facility in France. 

Other forms of weight loss drugs could help 

Alternative forms of weight loss drugs could also help alleviate supply constraints in the future.
Eli Lilly has limited capacity to make autoinjectors for Mounjaro and Zepbound. So, the company plans to launch Mounjaro in a delivery device called KwikPen in certain countries outside of the U.S. The method requires additional regulatory approvals. The UK recently approved Mounjaro in KwikPen form. 
The drugmaker has said launching KwikPen forms of its incretin drugs will expand supply. That’s because Eli Lilly for years has used that device for insulin, so the company can tap into existing manufacturing resources to make more of other incretin drugs. 

George Frey | Reuters

KwikPen is a single four-dose pen that covers a month’s treatment. Patients using autoinjectors go through four different pens per month.
Wells Fargo analyst Mohit Bansal wrote in a note last month that if Eli Lilly launches its diabetes and weight loss drugs in KwikPen form in the U.S., it could be a “source of supply upside” in the market for 2025.
But both Eli Lilly and analysts have said that oral forms of weight loss and diabetes drugs, which are typically easier and cheaper to manufacture, will be key to meeting demand.
Eli Lilly is developing an oral drug called orforglipron, which may have an edge over experimental weight loss pills from Novo Nordisk and Pfizer. 
Eli Lilly’s pill helped overweight or obese patients lose up to 14.7% of their body weight after 36 weeks in a midstage trial. The result appeared to be consistent with the weight reduction caused by Novo Nordisk’s oral drug, but over a shorter trial period. 
Still, Eli Lilly may release late-stage trial data on the pill in 2025, so it won’t be entering the market any time soon.  More

Temu, the controversial Chinese e-commerce giant owned by Pinduoduo, is planning to air a Super Bowl ad that lawmakers are calling on Paramount and CBS not to run.
The company skyrocketed to prominence last year after it ran a Super Bowl ad that invited customers to shop “like a billionaire.”
Temu is under congressional investigation for the use of forced labor in its supply chain and has been accused of spying on its customers.

Jakub Porzycki | Nurphoto | Getty Images

Temu, the controversial Chinese e-commerce giant looking to take on Amazon, is returning to the big game on Sunday with a Super Bowl ad that lawmakers are calling on Paramount Global and CBS not to run.
The company, owned by PDD Holdings, skyrocketed to prominence last year after it ran an ad during the big game just a few months after it was founded. 

Last year’s advertisement touted Temu’s low prices and invited consumers to shop “like a billionaire.” The multi-million dollar investment put Temu on the map and by the end of 2023, it was the No. 1 most-downloaded app in the U.S. with monthly active users topping 51 million this January, up nearly 300% year over year, according to data from Sensor Tower. 
The specifics of this year’s ad haven’t been revealed, but already it’s marred in controversy.
The company is looking to win over U.S. shoppers by being the next best “everything store” with lower prices than competitors, but lawmakers say it uses slave labor in its supply chain and spies on its customers. 
On Wednesday, 11 Republican lawmakers sent a letter to the CEOs of CBS, which is airing the Super Bowl, and parent company Paramount urging them not to run the advertisement.
“Since last year’s Super Bowl, Congress, through the House Select Committee on the Chinese Community Party, has uncovered alarming findings that indicate Temu has a pattern of noncompliance towards illicit products entering the United States market,” the missive read.

“Specifically, Temu ‘does not have any system to ensure compliance with the Uyghur Forced Labor Prevention Act (UFLPA). This all but guarantees that shipments from Temu containing products made with forced labor are entering the United States on a regular basis, in violation of the UFLPA,'” it says, citing the House committee report.
Allowing Temu’s commercial to air “would be a touchdown for the Chinese Communist Party against the home team,” the letter stated.
The letter was sent by Rep. Carol Miller, R-W.V., and signed by Reps. Byron Donalds, R-Fla., Jim Banks, R-Ind., Nicole Malliotakis, R-N.Y., Christopher Smith, R-N.J., Pete Stauber, R-Minn., Ronny Jackson, R-Tex., Michelle Steel, R-Calif., Beth Van Duyne, R-Tex., James Baird, R-Ind. and Mike Carey, R-Ohio.
Paramount and CBS declined to comment.

Labor allegations

Temu, along with Shein and other apparel retailers with a manufacturing presence in China, has been under congressional investigation from the House Select Committee on the Chinese Communist Party since May.
While cotton and other raw materials that can be traced to forced labor is a problem across the entire fashion industry, Shein regularly provides data on how often banned cotton is found in its clothes and publishes the results of the audits it conducts on its manufacturers. Other retailers also publish audit results.
Temu has yet to provide such data publicly.
“Company officials lazily point to boilerplate terms and conditions asking suppliers not to use forced labor, but Temu does not conduct audits and has no compliance system to prevent supporting atrocities,” committee member, Congressman Blaine Luetkemeyer, R-Mo., said in a Friday bulletin. “The company even admitted it ‘does not expressly prohibit third-party sellers from selling products based on their origin in the Xinjiang Autonomous Region’ and completely disregards the Uyghur Forced Labor Prevention Act.”
In a statement to CNBC, Luetkemeyer called Temu’s ad “sickening.”
“Some people watch the Super Bowl for the commercials as much as the game. It’s sickening to think a company built on slave labor with close ties to the Chinese Communist Party is going to make a direct appeal to millions of Americans all at once,” said Luetkemeyer. “I hope it only draws attention to the sinister background of both Temu and Pinduoduo if and when people see it. A flashy advertisement for the site’s cheap products is lipstick on the ugliest pig around.”
In response, a Temu spokesperson told CNBC its standards and practices surrounding the use of forced labor are “no different” from major e-commerce players like “Amazon, eBay and Etsy” and the allegations “are completely ungrounded.” 
“Before setting up their stores and listing products on Temu, every seller has to sign an agreement. This document stands as a pledge to maintain lawful and compliant business operations, and adhere strictly to the legal standards and regulations of their specific markets,” the spokesperson said. 
“The use of forced, penal, or child labor is strictly prohibited. Employment by all our merchants and suppliers must be strictly voluntary. They shall respect the freedom of association and workers’ rights to collectively bargain. Temu’s merchants, suppliers, and other third parties must pay their employees and contractors on time and must comply with all applicable local wage and hours laws.” More

After YouTube committed $2 billion per year to secure the rights to NFL Sunday Ticket, YouTube TV grew from 5 million subscribers in 2022 to more than 8 million this year.
Enlisting some of YouTube’s top creators to promote NFL Sunday Ticket helped drive engagement among tens of millions of users, the league said.
The parties are calling the approach a “helmets off strategy,” aiming to elevate the breadth of content surrounding the football season.

YouTuber Deestroying and NFL Commissioner Roger Goodell presenting at YouTube’s Brandcast in May 2023.
Credit: YouTube

YouTube bet big on the NFL to boost its subscriber base, and content creators have been key to that push.
After YouTube committed $2 billion per year to secure the rights to NFL Sunday Ticket, YouTube TV grew from 5 million subscribers in 2022 to more than 8 million this year. Enlisting some of YouTube’s top creators to promote NFL Sunday Ticket helped drive engagement among tens of millions of users, the league said.

“We can bring together people’s favorite creators with a lot of what you might traditionally associate with TV around professional sports and the NFL,” said Christian Oestlien, YouTube TV’s vice president of product management. “Bringing those two worlds together is letting us really open up the NFL to a whole new generation of fans.”
A subscription to YouTube TV costs $73 per month, with an additional annual fee of $349 for access to NFL Sunday Ticket.
YouTube TV enlisted familiar YouTube stars including lifestyle creators, vloggers and sports creators to attract new audiences to the NFL. The creators attended NFL games during the inaugural season of the partnership, and shared content and collaborated with advertisers to boost engagement.
The NFL, in turn, launched various shows on YouTube, such as “Creator of the Week,” to help promote creators on the sidelines. Those YouTube Shorts featured creators such as Sean Evans — host of the chicken-wing-centric interview show Hot Ones — and Ninja, a professional Battle Royale player and streamer.
The parties are calling the approach a “helmets off strategy,” aiming to elevate the breadth of content surrounding the football season.

“It’s another way for us to extend our messaging and, more, the lifestyle around football,” said Ian Trombetta, NFL senior vice president of social, influencer and content marketing. “So many new fans are coming in, not just in the U.S., but globally.”
YouTube accounted for 8.5% of total TV watch time in December, outpacing other major streaming services such as Netflix and Disney+, according to Nielsen.
While overall viewership on YouTube declined last year, according to Nielsen, Tom Rogers, a media expert and executive chairman of gaming content sharing platform Oorbit, noted that a substantial amount of live TV streaming growth last quarter was attributed to YouTube TV. Rogers emphasized that its advantage during that period was its offering of Sunday Ticket.
“NFL Sunday Ticket gives us a great way to work with a very good partner with very valuable content and see how it works,” Sundar Pichai, CEO of YouTube parent Alphabet, said during an interview Thursday with CNBC’s “Squawk Box.” “So far it has been great, but we will have a disciplined ROI [return on investment] framework.”

Drawing new, younger fans

One of the NFL’s biggest creator partnerships has been with Donald De La Haye, known online as Deestroying, a sports creator with more than 12 million followers across platforms. De La Haye was recently signed to the United Football League to play for the San Antonio Brahmas.
“It’s bringing new audiences to the game that’s so amazing that I love so much,” said De La Haye. “It’s just helping build that audience and making everybody a fan of the game.”
Lifestyle creator Pierson Wodzynski — who has 24 million followers across platforms but hadn’t previously delved into sports-related content — found her place in YouTube’s NFL strategy by documenting her journey taking every form of transportation to arrive at a San Francisco 49ers game. The video attracted 1.4 million views.
De La Haye, Wodzynski and Evans will appear in a YouTube TV ad that will air during the Super Bowl.

Screenshot from YouTube TV’s Super Bowl ad featuring Donald De La Haye, Pierson Wodzynski and Sean Evans
Credit: YouTube

The creator partnerships have been helpful in capturing a younger demographic.
“I don’t think the NFL could have created the ratings surge they created this season without younger audiences showing up,” said Rogers. “We know it is very hard to reach younger audiences through TV marketing because they watch comparatively less, so I suspect the league’s use of influencers was very important to ratings.”
They’ve also increased NFL content from off the field.
Influencers such as Alix Earle and Kristin Juszczyk, both in romantic relationships with NFL players, went viral this season by sharing glimpses of their game-day experiences. Juszczyk also gained recognition for her creation of custom game-day outfits, which garnered attention when worn by pop icon Taylor Swift and Brittany Mahomes, the wife of Kansas City Chiefs quarterback Patrick Mahomes.
Swift had her own impact on social media this season, after posts about her relationship with Chiefs tight end Travis Kelce went viral online.
Travis Kelce and his brother Jason, a center for the Philadelphia Eagles, have their own podcast, called New Heights. It’s hosted on YouTube and has amassed more than 670 million views.
YouTube’s global head of brand marketing, Angela Courtin, said the strategy this season with content creators was to invite a broad range of audiences into every aspect of the NFL experience.
“I have to say these creators are equal if not better than any other channel that I would use in my immediate plan,” Courtin said. “They exceeded our ROI benchmarks so much that we’ll be supercharging them next season.” More