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Good morning readers. Try telling someone like Rupert Murdoch he’s too old to do something…like say, get married. The media titan took a fifth trip down the aisle, exchanging vows with Elena Zhukova, a retired molecular biologist. The 93-year-old billionaire hosted the ceremony at his California vineyard, flaunting photos alongside his 67-year-old bride. If you’re counting, that’s a 26 year difference.

Zhukova, mother to art collector Dasha Zhukova, is no stranger to high society, having been previously married to Russian oligarch Roman Abramovich's ex-wife. But love seems persistent for Murdoch, despite past engagements fizzling out.

Let’s jump into today’s storylines.

In today’s digest:

• Gap and Foot Locker shine with revamps in tough retail quarter

• Headline Hustle: Live Nation gets hacked and has its data sold on the dark web, FCC ends the ‘affordable internet program’, India sees economy grow by 8% as election comes to a close

• Clouds over the enterprise software sector signal stormy times ahead

• The Week Ahead: What to Expect

• Pulse Points: What’s Trending

RETAIL

Retail's chess game is winning by strategy, not by chance

If retail's first-quarter earnings were a poker game, some players have clearly mastered the art of the bluff. As economic headwinds buffet consumers, leading to tightened belts and pickier pocketbooks, the standout performers aren't necessarily those with the flashiest products but those executing with precision and playing to the cost-conscious crowd.

Winners take it all, losers stand small

The leaderboard shows a clear split. Companies like Abercrombie & Fitch, TJX Companies, and Gap have cruised past Wall Street's benchmarks, while Kohl's, American Eagle, and Target have stumbled, caught in the headwinds of an unforgiving economic climate.

Gap and Foot Locker have emerged as the quarter's dark horses. Both brands, in the throes of aggressive revamps, outperformed market expectations on Thursday, signaling that strategic reinvention is more than just corporate buzz—it's profitable.

• Gap, once a fading star in the retail sky, has seen a resurgence across all its brands for the first time in years, a revival spurred by CEO Richard Dickson's focus on brand revitalization and savvy marketing.

• Meanwhile, Foot Locker's overhaul of store layouts to feature brand-specific displays rather than a jumbled mix has not only enhanced the shopping experience but also aligned more closely with modern retail trends.

The denim wars paint a stark contrast in retail fortunes. American Eagle and Kohl’s report struggles with trend adaptation and execution, with Kohl’s notably facing its largest single-day stock plunge after posting disappointing results. Retailers now compete not only with each other but with agile upstarts like Shein, which can pivot from design to digital storefront in mere weeks, setting a breakneck pace that traditional retailers struggle to match.

The road ahead: As the retail landscape continues to evolve, the clear message from this quarter’s earnings is that understanding consumer priorities and swiftly adapting to market demands are key to staying relevant and profitable. For some, this might mean a radical overhaul of strategies, while for others, it's about refining a winning formula.

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IN THE KNOW

Headline Hustle

🎫 Live Nation gets hacked and has its data sold on the dark web. Live Nation reported in a regulatory filing that alleged user data from Ticketmaster is being sold on the dark web, following "unauthorized activity" detected on May 20. The investigation, involving forensic experts and law enforcement, began shortly after, with the data appearing for sale by May 27. The hacker group ShinyHunters is allegedly responsible. Despite this, Live Nation believes there has been no significant financial or operational impact. This incident compounds a challenging year for Live Nation, already facing a lawsuit from the US government and multiple states accusing Ticketmaster of abusing its market dominance.

💻️ FCC officially ends the ‘affordable internet program’ due to a lack of funds. The US government announced the termination of the Affordable Connectivity Program (ACP), which has been aiding millions of low-income Americans with their internet bills. Despite bipartisan appreciation and a reliance by about one in five households, the program will end on June 24 due to lack of continued funding from Congress. The closure is set to affect nearly 60 million Americans, increasing internet costs for them. President Biden has urged Congress to renew the program, while some providers have pledged to maintain lower-cost plans for qualifying households.

🇮🇳 India sees economy grow by 8% as election comes to an end. India's economy grew by 8.2% in the fiscal year ending in March, surpassing expectations and bolstering Prime Minister Narendra Modi's re-election campaign as the country concludes its national election. With a GDP growth of 7.8% in the last quarter, India remains the world's fastest-growing major economy. However, challenges like high youth unemployment and climate change persist. Modi's potential third term could influence India's economic direction, with election results due on June 4.

TECH

It was a week of highs and lows in Enterprise tech

If the enterprise software sector had a "status" this week, it would be "it's complicated." As financial analysts busily adjusted their spectacles, the industry presented a mosaic of ups and downs that could dizzy even the most seasoned investor.

Salesforce, a behemoth in cloud software, watched its shares tumble nearly 20%—the steepest fall since 2004—after revealing weaker-than-anticipated revenue and a gloomy outlook. CEO Marc Benioff reflected on the post-pandemic recalibration, a common theme echoed across the sector by companies like MongoDB, SentinelOne, UiPath, and Veeva, all of which scaled back their revenue projections amidst growing caution.

But this wasn't an isolated incident.

• The WisdomTree Cloud Computing Fund, a fund tracking major cloud stocks, witnessed a 5% dip, marking its most significant weekly drop since January.

• Major players like Paycom and Snowflake weren’t spared either, each shedding substantial market value in the turbulence.

A silver lining in the cloud?

Contrasting this downturn, Dell offered a sliver of optimism. Despite a narrowing gross margin forecast due to pricier inputs and a shift towards AI server sales, Dell raised its annual outlook buoyed by a swelling AI server backlog, demonstrating resilience amidst the storm.

The week that was: As the dust settles on a bruising week, the tech sector remains a barometer for broader economic trends, signaling a period of recalibration and realignment in response to enduring macroeconomic pressures and the transformative impact of AI.

WEEK AHEAD

What to expect

• India’s election is slated to end this week: India's general election concludes this week with Narendra Modi expected to win a third consecutive term, a feat not achieved since Jawaharlal Nehru. Modi's anticipated victory would solidify his image as a powerful global leader amid India's rising geopolitical influence and economic growth.

• EU holds elections for the European Parliament: The EU is also holding elections this week for the European Parliament, with 360 million Europeans eligible to vote. Far-right gains are predicted, which may impact Ursula von der Leyen's re-election as European Commission president and the EU's climate policy.

• Europe and Canada announce their interest rate decisions: The European Central Bank is expected to make an interest rate decision this Thursday, with speculation of a rate cut despite a rise in Eurozone inflation to 2.6%. The Bank of Canada is also expected to make a decision this Wednesday.

What else is happening…

• This week will also see important economic data releases, including US employment figures, EU GDP data, and PMI reports from various countries.

• Corporate earnings reports are expected this week, including: Inditex, Lululemon, Campbell Soup, NIO, CrowdStrike, and more.

• The 80th anniversary of D-Day is on Thursday.

SNIPPETS

Pulse Points

• Nvidia unveiled its next generation of artificial intelligence chips on Sunday, succeeding the model announced just months earlier in March.

• Former President Donald Trump's campaign launched an official TikTok account on Saturday, even as the platform faces a potential ban in the U.S.

• South Africa's African National Congress lost its parliamentary majority for the first time in 30 years, marking the country's most significant political shift since the end of apartheid.

• Tesla is recalling 125,227 vehicles in the United States because of a seat belt warning system malfunction that could increase injury risk in a collision, according to the National Highway Traffic Safety Administration.

• Marian Robinson, mother of former first lady Michelle Obama and a familiar presence in the White House, has passed away at the age of 86.

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