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Berkshire Hathaway takes $30 billion hit on Apple, Canada Goose posts strong earnings

Warren Buffett's Berkshire Hathaway is taking a $30 billion hit on Apple after "The Big Short's" Michael Burry bets against the stock; Canada Goose stock jumped after forecasting upbeat annual sales; Take-Two and Zynga approved merger proposals.

Video transcript

RACHELLE AKUFFO: Welcome back to Yahoo Finance Live, everyone. It is time for our triple play. And I'm going to kick us off with Take-Two Interactive Software. Now shareholders from this gaming publisher and creator have approved the $12.7 billion acquisition of entertainment and gaming company, Zynga. Now, Zynga, of course, is known for franchises including "Farmville" and "Words with Friends." Take-Two is known for its "Grand Theft Auto" and "NBA 2K" franchises. And as you can see there, it has been a tough year, though, for Take-Two. They are down year to date.

But the company has enjoyed an earnings beat when it reported late on Monday. Now the Take-Two CEO, Strauss Zelnick, called the move transformative for our company as we create a powerful and diverse portfolio of industry leading titles, while also becoming a leader in mobile games. Now this acquisition also opens up the possibility of more free to play games and versions of its titles. Now, shares of Zynga will stop trading after tomorrow's close. And it will delist from the NASDAQ. The closing is set for May 23, so a big merger there that you see with these two big gaming giants.

SEANA SMITH: Yeah, it certainly is, and we were waiting on news of when that would close. We know that the deal was announced earlier this year, but results are interesting because Take-Two, I guess you could call it a pandemic play because more people were playing video games, allocating more of their time to that sort of thing during the pandemic. So it's interesting when you take a look at some of the CEO's comments, the fact that he was saying, we were expecting this. We were expecting a slowdown, so not really taking us by surprise. But of course, consumer engagement is critical to a name like Take-Two going forward and has been critical to Zynga. So we'll see how things shake out going forward.

Let's take a look at Canada Goose because we've been talking about the fact that it has been a very rough couple of weeks for retail. So it's actually a bright spot here in the sector. You can see the shares up just over 9%. Now the company posted strong earnings for its fiscal fourth quarter, beating the Street's estimates for EPS and revenue. Also posted solid margins. Now, as a surprise, quarterly profit coming despite lockdowns in China. We know China is a critical region, critical country, for the company. Canada Goose also giving an impressive outlook for its full fiscal year, raising its guidance. Year to date, though, Dave, the stock hasn't been a winner, with shares off just over 40%.

DAVE BRIGGS: Yeah, in that report, it's interesting to hear them say normalization in China, they don't expect till the third or fourth quarter, which is frightening for a lot of consumers. But cheers to our neighbor to the north. They expect no supply chain issues in the year ahead, none. And 84% of their product is made in Canada. It makes me want to consider that patch on my shoulder, not that I can afford the $750.

SEANA SMITH: I know. I was going to say, yeah, you have to be willing-- 750?


SEANA SMITH: No, that's, like, for a vest.

DAVE BRIGGS: Oh, so I'm not--

SEANA SMITH: The jackets are, like, 1,200 to 15-- yeah.

DAVE BRIGGS: You're talking north of a grand.

SEANA SMITH: Oh, yeah. People pay a lot of money for that.

DAVE BRIGGS: OK, maybe I'll pass on the patch for now.

SEANA SMITH: I know, yeah.

DAVE BRIGGS: I strive to someday wear that patch.

SEANA SMITH: Maybe, we'll see.

DAVE BRIGGS: I'll work up to it.

SEANA SMITH: We'll both try to get there.

DAVE BRIGGS: All right, my play is Apple. Shares down more than 20%, shockingly, year to date, after a really tough trading day on Wednesday. Now news that infamous investor Michael Burry of the "Big Short" fame bet against Apple, according to an SEC filing. Burry short worth around $36 million or 206,000 shares, but on the other side of that bet, as you know, the oracle of Omaha, Warren Buffett, whose investment represents 42% of Berkshire Hathaway holdings, he has increased that over the recent year. Those roughly 900 million shares taking a $30 billion hit, though, since March 31st.

You want to see that future, though, for Apple, you might have to see it through goggles. Their board reportedly previewed its new mixed reality goggles last week. Apple's last major new product launch was the Watch back in 2015. As for the shares today, they are down 2 and 1/2%. So Rachelle, who you got-- Buffett or Burry in that battle?

RACHELLE AKUFFO: I'm going Buffett because, you know--


RACHELLE AKUFFO: Apart from the fact that he-- you can't beat the oracle right there. But I mean, we have had analysts say, look, when you've seen a lot of downturns, as we saw with the 2008 crisis, and we saw a lot of these tech stocks tank, including Apple, look where it went since then, as you look at how the price rebounded. So I would definitely not bet against Apple. And I'm not surprised that they haven't come up with a lot of new products. Obviously, they have been more focused on their services element, more so than the products and the sort of razzle dazzle that really was a trademark of Apple when they first came out. So, yeah, I'd give it to Buffett.

DAVE BRIGGS: Yeah, I think the new launch everyone's waiting for isn't the product, but a service. And it's that subscription service I think that we're all waiting for, which sounds like a homerun, a slam dunk, whatever sports analogy you want to use, for the future. All of us seem a little bit weary about the VR or mixed reality goggles.

SEANA SMITH: Yeah, I'm definitely a little bit weary about it. It is interesting, though, that they did come out with a product because, like you said, it's been quite some time. But it's hard to bet against Apple's products because they have really been so successful for the company. The iPhone, even the Watch-- there's been some critics out there for a Watch. I'm a huge believer in the Watch. So maybe-- I don't have it on right now.

DAVE BRIGGS: The Google Watch is coming for them, though. It is interesting.

SEANA SMITH: It is. The Google Watch is coming. Yeah, it'll be interesting to see how big of a competitor they turn out to be, how many followers they get in that space. But Apple Watch, I'm a big believer. I just don't have it on because I'm not very good at charging it.

DAVE BRIGGS: So we're all betting on Buffett, to be clear. Clean sweep.

SEANA SMITH: Yep, betting on Buffett.

DAVE BRIGGS: All right.

RACHELLE AKUFFO: And meanwhile, I'm team Android, but still, I'm still betting on Buffett.

SEANA SMITH: You are? My goodness.

RACHELLE AKUFFO: I know. I'm hanging in there, but I'm definitely team Android.

DAVE BRIGGS: Fight the good fight.