The Rundown - Nike Tanks After Warning of Sales Drop, TikTok Signs Deal for U.S. Joint Venture

Episode Date: December 19, 2025

Market update for December 19, 2025. Follow us on Instagram (@TheRundownDaily) for bonus content and instant reactions.In this episode:Economists question the quality of the inflation dataNike beats earnings but warns of weaker sales and margin pressureTikTok moves closer to a U.S. spinoff with Oracle-led investorsCoreWeave joining the federal government’s AI “Genesis” missionMaybe the greatest fun fact in this show’s history

Public.com presents the rundown. Your daily market update in under 10 minutes. My name is Zadadmani and today is Friday, December 19. In today's episode, we'll tell you what Nike said in their earnings that has investors worry. We'll also give you the latest on TikTok's plans to continue operating in the U.S. Then stick around to the end of the show to find out which company replaced Enron in the S&P 500 back in 2001. and why it was one of the greatest decisions ever made. We got a great show for you today.

Let's go. Stocks finally saw some green on Thursday, thanks to a boost following the CPI report. The S&P 500 jumped 0.8% yesterday, breaking a four-day losing streak while the NASDAQ was up 1.4%. Now, we talked about the CPI report on yesterday's show, but just in case you missed it, the latest report showed that inflation in November was 2.7%, which was way lower than the 3.1% that economists were expecting. So it was a nice early Christmas gift for the markets, but I should point out that a lot of economists are warning the data in the November report could be a bit messy because of

the government shutdown. The government shutdown in November impacted the Bureau of Labor Statistics's data collection, so they had to make some assumptions and workarounds to fill in the missing data. So some economists are taking, yes. yesterday's CPI report with a grain of salt. But not the stock market, though. It was ripping yesterday. And who knows, maybe this report will spark an end of the year's Santa Claus rally.

Speaking of Santa Claus, we have now entered the part of the calendar where things are really slowing down. There's not much economic data expected over the next couple of weeks. And usually not many major deals or news are announced either. We will have a short week next week. The stock market will close early on Wednesday, December 24th for Christmas Eve and then closed all day on Thursday for Christmas. So we won't have a show on Christmas Day.

But we're still going to be posting the other days. So definitely check us out if you need your market fix next week. You might have to get creative with it next week if there's zero news to talk about. But we'll have fun with it. Maybe we'll do listener questions. I might compare tech companies to NBA players. I don't know. Anything is possible.

Also, don't forget, deep dive coming tomorrow. This one is about the Medline IPO, which was the biggest IPO since 2021, despite not many people being familiar with the company. We broke down what Medline does in the bull and bear case with the company moving forward. So that's a very good episode coming. on Saturday and then on Sunday morning, Kyla Scanlan joins the show to co-host an interview with economist Justin Wolfers. And let's just say that was a very interesting and at times very fiery interview. I'll be honest with you guys. I'm not sure how much of that interview will make the final cut. That's all I have to say. But that interview drops on Sunday morning,

so keep an eye on your podcast feed for that. Let's run through some headlines. Starting with Nike. Nike reported earnings last night and they, beat revenue and profit expectations, but you probably couldn't tell that from looking at their stock price because shares are getting hit hard today. The problem wasn't their last quarter. It's what the company is projecting moving forward. Oh, and also China. Revenue's last quarter were up 1%. But Nike warned that sales in the current quarter will fall in the low single digits, which is a sharp reversal after two straight quarters of growth. And regionally, the picture is very mixed. In North America, sales were up 9% showing that Nike's core market is now still.

stabilizing and growing, but over in China, things are going the opposite direction. Revenues in the greater China region fell 17%, much worse than investors were expecting. The revenue coming out of China was about $1.4 billion. And the biggest drag was footwear. Nike said that footwear sales in the region dropped by roughly $250 million as store traffic slowed and unsold inventory piled up. That's forced Nike to discount their products aggressively just to clear inventory, which has hurt both their pricing power and their margins. And speaking to margins, tariffs here in the U.S.

are becoming a real problem. Nike said that its gross margins fell about three percentage points largely due to tariffs, which the company estimates will now cost them $1.5 billion a year. Now, Nike CEO Elliott Hill, who took over a year ago to lead Nike's turnaround, says that Nike is in the middle innings of the comeback. But I mean, that's exactly the issue here. Investors have been waiting for the turnaround to show up in the numbers, and it looks like they're going to have to wait a bit longer. Some investors are getting impatient, though, and selling their stock. Nike stock is down more than 10% this morning in pre-market trading. Let's shift gears and talk about TikTok. TikTok and its Chinese parent company, ByteDance, have officially signed an agreement

to create a new U.S. joint venture, which would finally separate TikTok's U.S. operations from BightDance. According to an internal memo from TikTok CEO Xia Shu, the new U.S. TikTok entity will be majority owned by American investors, led by Oracle, Silver Lake, and MGX, which is an investment firm backed by Abu Dhabi. They will each get a 15% stake, while bite dance would retain a 20% ownership, and the rest of it will be held by existing investors. The U.S. version of TikTok would operate as an independent company controlling things like data security, content moderation, an algorithm oversight here in the U.S., which were some of the reasons that TikTok got banned in the U.S. in the first place. Now, lawmakers in D.C. have been worried that TikTok's Chinese ownership

could give the Chinese government access to U.S. user data or influence what Americans see on the app. So this deal is designed to address all those concerns, at least on paper. You know, what's confusing to me is that the algorithm that powers TikTok, it's their secret sauce, it's going to be licensed from BytDance. So despite TikTok US being an independent company, this deal structure might not meet the law that banned TikTok in the first place. So we'll see what ends up happening. This deal is expected to close by January 22nd, but the Chinese government still has to approve this deal as well. So this deal could fall apart in the last minute if Beijing decides to block it.

The market seems to be optimistic, though, Oracle's stock is up 5% this morning, and boy, did they need this win after the month they've been having. Let's talk about some stocks making moves today. Shares of Corweave are jumping this morning after the AI Data Center company announced that it's joining the federal government's Genesis mission, which is an initiative led by the Department of Energy aimed at accelerating scientific research using advanced AI. The Genesis mission was created last month

through an executive order under the Trump administration, calling on federal agencies to pool computing power data and AI tools, and it's already being compared to a modern-day Manhattan project for AI. Now, as part of this program, Corwee will provide a purpose-built AI cloud platform

to support scientific workloads across government research institutions. And the timing here is pretty important because just a few months ago, CoreWe've actually launched a dedicated business unit called Corwee federal, which is aimed at selling AI infrastructure directly to U.S. government agencies, including work that requires high security standards and federal compliance. So this is a big win for

them, and CoreWeave stock is up more than 5% this morning in pre-market trading. CorWeave has quietly lost half its value since late October. I mean, it has been an epic six-week slide. Just like with other AI companies, investors are worried about the heavy debt load on the company, along with construction delays on some of their big data center projects. So maybe this Genesis mission announcement will help spark a bounce back rally. We'll have to see. Now, on the flip side, shares of KB homes are sliding after the home builder reported declining demand for new houses due to affordability issues. Now, KB did beat earnings for the quarter, but the home builder's backlog continues to plummet. It dropped to $1.4 billion in the quarter, which is down more than

37% year over year. Margins are also under pressure. They're operating margins drop to around 7%, which is down roughly 5 percentage points from a year ago. You know, because of high more. mortgage rates and affordability issues, KB has been forced to offer incentives to potential home buyers, which is eating into their profits. As a result, KB home stock is down roughly 6% this morning in pre-market trading. We've heard from a few home builders over the last couple of weeks, and they all seem to be saying the same thing. People just aren't buying homes because it's just too expensive. Let's wrap the show with a fun fact. InVideo replaced Enron in the S&P 500 back in November of 2001. This might be the best fun fact that I've ever heard. I mean, that is crazy.

See, Enron was kicked out of the S&P after its infamous accounting scandal. The company stock had lost nearly all of its value by then, and they filed for bankruptcy just a month later in December of 2001. So the S&P 500 committee replaced Enron with this little-known graphics card company out of California, which I bet most people didn't even know how to pronounce at the time. And it might be one of the best decisions they've ever made, because NVIDIA's stock has gone up a thousand X since being added to the S&P. So if you've invested in the S&P 500 after November of 2001, you've had exposure to NVIDIA. You know, it is funny that all these years later that NVIDIA's accounting practices are now coming into question to the point where NVIDIA had to put out

a memo stating that they weren't Enron. It just makes this fun fact even better. Well, all right, guys, that's the rundown for today. That's the rundown for this week. I hope you guys enjoyed today's episode. I apologize for the Raspi voice. I'm starting to lose my voice a little bit. It always happens this time of year. Hopefully it'll be better by Monday's show, but I appreciate you guys putting up with it. By the way, if you guys enjoyed today's episode, consider giving us a five-star rating on Apple, Spotify, YouTube, wherever you listen to your podcast. And if you are listening on Spotify, don't forget to vote in today's Spotify poll. Leave us a comment on Spotify. All that engagement really does help us out and it helps other people find the show.

Thank you guys again for listening, watching, and commenting. Shout out to Mike and Connor. behind the scenes and we'll see you guys back here tomorrow for the deep dive. Rosen lasagna, medium power, 15 minutes. Sounds like Ojo time. Let's play. Feel the fun with Play Ojo. The online casino with all the latest slot and live casino games. What you win is yours to keep with no wagering requirements, instant payouts and no minimum withdraws.

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