Booking Holdings' Hotel Commissions 'Too High' – Swiss Watchdog Orders 25% Cut
Swiss authorities believe ordering Booking.com to cut commission fees will boost the country's hotel industry — but the online travel agency said it would appeal.
Switzerland's "price watchdog" has ordered Booking.com to lower prices in the country, ruling that the online travel agency's commission rates for hotels are "too high."
The supervisory body said on Wednesday that Booking.com will be required to reduce commission rates for Swish hotels by 25%, adding th
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New York Times
2 hours ago
- New York Times
How can Liverpool afford Florian Wirtz?
The signing of Florian Wirtz comprises a new club-record deal for Liverpool. Wirtz will join from Bayer Leverkusen on a five-year contract. In exchange, Liverpool have agreed to pay the German club £100million ($135.9m) in guaranteed fees, with a potential £16m due in add-ons. The deal, even without those add-ons, eclipses Liverpool's previous transfer record by a distance. That record is generally seen as having been in place since January 2018, when they parted with £75m to buy Virgil van Dijk from Southampton. Advertisement In fact, the Van Dijk fee may already have been topped prior to this agreement. Darwin Nunez was signed from Benfica in June 2022 for an initial £64m that could rise to £85m. To the end of last December, according to the Portuguese side's financial disclosures, Liverpool had paid a further €10m (around £8.5m) of a potential €25m in add-ons, so any more conditions being met in the last six months could mean Nunez's transfer fee went past Van Dijk's. Either way, Wirtz's signing tops both of them, and makes him one of only a dozen or so footballers in history to command a £100m-plus fee. How, then, can his new side afford him? Wirtz's club-record arrival comes at a time when Liverpool are enjoying record revenues. They cleared £600m for the first time in 2023-24, a year in which they had to make do with Europa League football and finishing third in the Premier League. Last season, with a return to the Champions League and a twentieth domestic title secured, alongside a full season of the extended Anfield Road End being open and continued commercial growth, Liverpool should have topped £700m in turnover, a feat only previously managed by Manchester City in England. A further record in 2025-26 looks likely. The Athletic estimates Liverpool earned £181.5m through winning the Premier League and, even if they don't retain the title in 2025-26, they will still benefit from an uptick in the league's overall income. A new TV rights cycle starts this season, with the Premier League expecting to earn £12.25bn over the next three years — a 17 per cent increase on the 2022-25 cycle. Liverpool's commercial growth is well-placed to continue. August will see them begin a new kit deal with Adidas. The agreement, while incentive-based, represents a significant potential increase on the club's already lucrative arrangement with Nike. The latter secured Liverpool a base payment of £30million a season, but garnered around double that in reality. Booming revenues are all well and good but of little use if your expenditure is through the roof. Liverpool lost £57.1million pre-tax in 2023-24, the worst financial result both of the Fenway Sports Group (FSG) era and in the club's history, so are costs are swallowing their income whole? Not really. That big loss a year ago was very much out of the ordinary for a club who, across FSG's near-15 years at the helm, have broken even. In fact they've most likely done better than that: as detailed in The Athletic's BookKeeper series, published in March, we expect Liverpool to have returned to profitability in 2024-25, and healthy profitability too. Even if the club's wage bill crept up to the £400m mark — not a guarantee by any stretch, but possible once league-winning bonuses were handed out — we project Liverpool could still have booked a £30m profit. Advertisement The club are big wage-payers, as evidenced by their 2023-24 wage bill only trailing Manchester City domestically. The Athletic understands Wirtz will earn around £200,000 per week at Anfield, before any bonuses which may accrue to him. From Liverpool's perspective, inclusive of employer-related costs on top of his basic salary, Wirtz will cost them at least £12m a year to employ. Liverpool have some world-class players and pay them accordingly, but they'll benefit from the departure of Trent Alexander-Arnold, who also cost them £12m a year in employment-related costs (again before bonuses). One of the reasons the signings of Van Dijk and goalkeeper Alisson are often pointed to as examples of Liverpool not skimping on fees is they were pretty much outliers; they did spend big on the pair, but their transfer spending has generally trailed domestic rivals. At the end of 2023-24 the cost of assembling Liverpool's squad, across transfer and agent fees, was £749.4m, the seventh most expensive squad in the world but well behind Chelsea (£1.4bn), Manchester City (£1.1bn), Manchester United (£943.9m) and Arsenal (£882.4m). Correspondingly, annual amortisation costs hitting the club's books were well below domestic peers; Liverpool's amortisation bill of £114.5m last year was over £20m behind Spurs and £75m less than Chelsea. After a quiet summer in 2024, amortisation won't have ticked up much, if at all. Assuming his signing completes on June 16, when the transfer window reopens, Wirtz's £100m fee, plus assumed agent fees on top of around 10 per cent, will add £20.9m to Liverpool's 2025-26 amortisation bill, with a further £21.8m per season following thereafter until 2029-30 (a small sliver, £1.8m, will fall into 2030-31 as a result of the club's 31 May accounting date). Alongside the recent signing of Jeremie Frimpong, they'll have added around £28m a season onto their amortisation costs, but they'll still trail all the rest of the 'Big Six' clubs, with the potential exception of Spurs. Advertisement No. We recently explained how Liverpool could have lost £75m last season without breaking any Premier League rules. Across wages and transfer fee amortisation, signing Wirtz will add an extra £34m or so in annual costs — but the club have the headroom to handle it. That's not to say that outgoings are not likely this summer. They aren't needed to satisfy Profit and Sustainability Rules (PSR) — the profitability of 2024-25 and growing revenues will ensure no issues there — but they will help balance both the squad and the books. FSG has long sought to run Liverpool sustainably and, while they can splurge this summer without fear of bankruptcy or rule-breaking, and lose a chunk of money in 2025-26 if they wish to, that doesn't mean they'll do it for the sake of it. A big money departure, likely Nunez, would be no surprise. Cash worries are different from PSR ones, but Liverpool have little concern there either. Access to funds is no problem. Even if FSG was reluctant to loan money in (something they've generally preferred to do for infrastructure spend rather than operational costs), the ownership refinanced a revolving credit facility in September last year, lifting its limit from £200m to £350m. At the end of May 2024, it had only drawn down £116m of the original £200m, so there's plenty to be dipped into if the need arises. Liverpool may not need to increase borrowings anyway. Operating cash flow was positive at £83.7m in 2023-24 even without Champions League revenue, while cash spent on infrastructure has reduced following the completion of the revamped Anfield Road End. As well, their relatively low spending on transfers — and keenness to pay more of deals up front if they can — means Liverpool owe far less than peers in outstanding fee instalments. At the end of May 2024, they owed a net £69.9m, an amount which is expected to have dropped even lower in the past year. The previous figure was already lower than seven other Premier League clubs at the time and nowhere near the £308.9m Manchester United owed at the end of March 2025. Signing Wirtz is a significant undertaking for Liverpool. Combining the transfer fee, assumed agent fees and five years of his basic salary puts the total cost to Liverpool of signing and employing him at an estimated £170.5m. With potential add-ons and bonuses that sum could feasibly reach £200m. All parties concerned will hope it does — it will mean Wirtz and Liverpool have enjoyed plenty of success together. Those are big sums, but then Liverpool are a wealthy club. FSG's ownership has not been to every fan's taste, but it is precisely because of its frugality that Liverpool are able to make these deals when opportunities arise.
Yahoo
3 hours ago
- Yahoo
Europe's most valuable boss? How Christian Klein went from a 15-year-old intern to SAP's savior
May has been quite a month for Christian Klein, the baby-faced boss of Europe's most valuable company, SAP. He has just finished off his opening keynote at SAP's Sapphire event in Madrid, a summit attended by more than 6,000 people, when he finds time to squeeze in a putt-off on the main stage with Team Europe's 2014 Ryder Cup captain, Paul McGinley. A hole in one (on his second attempt) seems a fitting celebration. The false start nature of his foray on the putting green is reflective of his time at the helm of SAP, with his latest landmark the culmination of a tumultuous introduction, several false starts, and an overhaul of the company's organizational structure. Boasting a market value of $350 billion as of the end of May, SAP outpaced a struggling Novo Nordisk and a stunted luxury retail sector in March to confirm the unusual sighting of a German tech group atop Europe's public markets. Novo Nordisk reclaimed the mantle on the morning of June 13. The feat tops off a remarkable rise for the enterprise resource planning group, which is toasting record revenues and profits after a bet on cloud computing coincided with a global AI pivot that has seen demand for the company's business processes suite skyrocket. Fortune spoke with members of SAP's C-suite and leadership team to understand how Klein approached the mammoth task of turning a disparate SAP into Europe's most valuable company. Klein, just 45 years old, knows SAP better than most of the 120,000 people working at the company today. He first joined as a 15-year-old summer intern, ferrying clunky monitors around SAP's Walldorf headquarters with one eye on a professional football career. 'I can still remember, I tested them all, and one out of 10 didn't work,' Klein told Fortune in Madrid. 'In our area, SAP is a logical choice,' Klein says of the fateful application to the company he would run decades later. Indeed, former classmates of his continue to work at the company, though he's not as close to them as he was then. SAP offers software packages that help businesses deal with all sorts of admin, like HR, supply-chain management, and procurement, also known as enterprise resource planning (ERP). Klein throws his head back with laughter as this reporter suggests it's not the most exciting subject matter for the layperson to try to care about. His time at the helm of the company, though, has betrayed the dull, bureaucratic principles on which SAP has made its billions. Following the departure of its previous boss, ServiceNow's American CEO, Bill McDermott, the software as a service (SaaS) provider faced criticism that it was a bloated amalgam of various acquisitions with no obvious plans to align them. McDermott and SAP got it in the neck on more than one occasion from executives at one of its main competitors, Oracle. The late former Oracle co-CEO, Mark Hurd, was critical of the company's acquisition strategy in 2019 after SAP's $8 billion move for experience management platform Qualtrics. 'We're not buying somebody to just buy them. We're buying companies that fit into our portfolio,' Hurd said at the time. It was under this cloud of uncertainty that Klein took on the role of co-CEO alongside Jennifer Morgan in 2019. In April 2020, Klein assumed the mantle of CEO alone, a month into global lockdowns, after Morgan abruptly stepped down. Sebastian Steinhaeuser, SAP's chief operating officer, first worked with Klein in 2020 as a consultant at Boston Consulting Group, ironing out a presidency-style plan for Klein's first 100 days in charge. Something about that time with Klein persuaded Steinhaeuser to jump on board, even if it raised eyebrows among his confidants. 'I think the general perception when I joined SAP, many friends and colleagues looked at me like, 'What are you doing? Like, are you sure?'' said Steinhaeuser. 'I think there was a time where instead of executing, [SAP] just defined a new strategy every two years. Every year, customers would sit here at Sapphire, we talked about the year before, if we had delivered it or not delivered it, and just pulled a new rabbit out of the hat.' Within a few months of taking sole charge of the company, Klein had to abandon a medium-term profitability forecast as the worst economic effects of the coronavirus kicked in. 'I think the stock got a hit of 20% or 25%, and everybody thought, 'It's crazy. Why would you do that?'' recalls Jan Gilg, SAP's chief revenue officer, of reactions to the guidance call. 'But then, in retrospect, you see that it was the only option he had.' Some of Klein's other big calls have been met with frustration from within his own ranks. SAP announced plans for a 10,000-strong headcount reduction in January last year. The company faced €3.1 billion in 'restructuring expenses' as a result of the deal, and retrained thousands of workers to adjust to its AI-first approach. An internal company survey released the following September, reported by Bloomberg, revealed more than half of SAP's employees were ready to join a competitor. Klein's proponents would argue his experience demonstrates what a CEO can achieve with the proper mandate for revolution. In that regard, it's not hyperbolic to compare Klein to Satya Nadella, the Microsoft CEO who increased the value of the company 10-fold in his first decade in charge by pivoting the firm first from PCs to cloud computing, then to the AI era. Just ask Muhammad Alam, a man who has worked with both CEOs, about the comparison. Alam heads up SAP's product and engineering board and is a member of the company's executive board. A 17-year Microsoft veteran, Alam left a cushy role as corporate vice president at the company's Dynamics 365 ERP (enterprise resource planning) division to join a then-uncertain SAP project. One of the reasons Alam took the leap of faith was Klein. 'I felt three years ago when I joined—and having seen Satya sort of transform Microsoft beginning in 2014—I felt the same level of energy, vision, and commitment from Christian and the leadership team here,' Alam said of the parallels between Klein and Nadella. 'I felt like he had both the ability to make the hard decisions and the energy and the commitment to see them through; because some of them aren't going to be popular with employees and others, if you will, but they're needed for the transformation.' Unlike Nadella's journey of being parachuted into Microsoft, it must have been a challenge for Klein to diagnose the strategy shift required at a company he had known intimately since his teens. Examples of long-running CEOs at Fortune 500 companies are rare. Burnout, a lack of experience, or boardroom preference for an outsider mean the onetime graduate rarely progresses to the boardroom. BMW's Oliver Zipse and General Motors' Mary Barra are two rare examples of CEOs who have worked at the same company for their entire careers. When that happens, Klein, unsurprisingly, sees it as an advantage. 'In the early days of becoming a CEO, it was of extreme value to understand who my stakeholders are. Because the transformation is not only about, 'Oh, we are now developing all software in the cloud,' it's a transformation for everyone. Everything is changing. And that's why I would say, in this situation, it was definitely a big plus,' Klein says on the advantages of being a lifer at SAP. 'I had to make sure that I communicated extremely often. All hands, investor meetings, customer meetings, because you have to explain more than once why this change is needed.' The rewards have been lucrative. In February, Klein secured a record $19.8 million payday for his efforts turning around SAP in 2024, a 165% increase on the year before. SAP stock surged to make it Europe's most valuable company weeks later. After an aggressive five-year overhaul, the outside observer would be pretty confident in declaring Klein had afforded himself the space to relax. Instead, though, Klein appears emboldened to go further, and look to the U.S.'s dominant tech sector. 'I would say I'm a bit more demanding than at the beginning, where there was sheer uncertainty. And I just had to make sure, as a leader, that everyone believes that the strategy is the right one. Now everyone believes in the strategy. Now it's about, 'How can we raise the bar and compete with the biggest tech companies in the world?'' This story was originally featured on Sign in to access your portfolio
Yahoo
3 hours ago
- Yahoo
Caterpillar vs. Volvo: Which Heavy Equipment Stock is the Better Buy Now?
Caterpillar Inc. CAT and Volvo VLVLY are global leaders in the heavy machinery and construction equipment industry, offering a wide range of products including trucks, excavators, and industrial engines. They are key players in infrastructure development and are actively investing in electrification and autonomous technologies to shape the future of construction and transportation. Caterpillar has a market capitalization of $171 billion, while Volvo has a market capitalization of $16.2 billion. With tariff tensions and weak demand weighing on the manufacturing sector at large, the question is which stock you should put your money on. To find out, let us dive into the fundamentals, growth prospects and challenges of both Caterpillar and Volvo. Caterpillar is the world's leading manufacturer of construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. The company operates through its three primary segments - Construction Industries (machinery in infrastructure and building construction applications), Resource Industries (mining, heavy construction and quarry and aggregates) and Energy & Transportation (which supports oil and gas, power generation, marine, rail and industrial customers). Caterpillar has been witnessing six consecutive quarters of volume declines. This was mainly attributed to weak demand in the Resource Industries and Construction Industries segments, due to subdued customer spending. Caterpillars' revenues declined 3.4% in fiscal 2024 and 9.8% in the first quarter of 2025. Even though earnings had increased 3% in 2024, the same plunged 24% in the first quarter of 2025. The Construction Industries segment has also been impacted by the downturn in China's real estate sector, particularly for 10-ton and larger excavators, which was once a key market for the company. Weak demand in Europe added to revenue pressures. For 2025, weaker results in the Construction Industries and Resource Industries segments are expected to offset the slight improvement in the Energy & Transportation segment. While high labor costs and potential tariffs remain risks, Caterpillar's pricing and cost-control initiatives should help cushion the impacts. CAT has a significant production base in the United States, which will give it a competitive advantage over companies reliant on imports. Looking ahead, Caterpillar stands to benefit from the surge in projects, driven by the United States Infrastructure Investment and Jobs Act. The shift toward clean energy will drive the demand for essential commodities, boosting the need for Caterpillar's mining equipment. Meanwhile, given their efficiency and safety, CAT's autonomous fleet are gaining momentum among miners. As technology companies establish data centers globally to support their generative AI applications, Caterpillar is witnessing robust order levels for reciprocating engines for data centers. The company is planning to double its output with a multi-year capital investment. CAT's efforts to grow its aftermarket parts and service-related revenues, which generate high margins, will also aid growth. Volvo is one of the leading manufacturers of trucks, buses and construction equipment as well as marine and industrial engines. Its subsidiary, Volvo Construction Equipment (Volvo CE), produces a wide range of machinery for the construction, extraction, waste processing and materials handling sectors. It manufactures haulers, wheel loaders, excavators, road construction machines and compact equipment. Since 2024, the demand for construction equipment has weakened across most regions. High interest rates and low confidence in Europe, and cooling demand in North America led Volvo CE to scale back production. In fiscal 2024, Volvo Construction Equipment' net sales decreased 16%. Earnings were also negatively impacted by an unfavorable brand and market mix, and lower volumes. This continued in the first quarter of fiscal 2025, with net sales of construction equipment down 8%. Increased uncertainty surrounding tariffs and their effect on global trade continues to weigh on results. Despite the slowdown, the company continues to push innovation with the rollout of new products. The year 2024 marked Volvo CE's largest product launch to date, with more than 80 new models. This included a modernized range of excavators and an extension of the wide range of electric machines, among them the first electric wheeled excavator. The rollout of Volvo Construction Equipment's new conventional product range continued in the first quarter with the launch of the A50 articulated hauler for the North American market, along with several local launches of the new range of excavators in Asian markets. With the need to expand and upgrade existing infrastructure in many countries across the globe, these investments will position Volvo CE for long-term Construction Equipment recently announced a strategic global investment in crawler excavator production at three key Volvo CE locations to meet growing demand and mitigate supply-chain risks through localized production. Volvo is also advancing autonomy to boost safety and productivity. Volvo Autonomous Solutions recently surpassed 1 million tons of limestone hauled autonomously for a client in Norway, highlighting its leadership in mining automation. The Zacks Consensus Estimate for Caterpillar's 2025 earnings is $18.70 per share, indicating a year-over-year decline of 14.6%. The estimate for 2026 of $21.09 indicates a rise of 12.8%. EPS estimates for both 2025 and 2026 have been trending south over the past 60 days. The Zacks Consensus Estimate for Volvo's fiscal 2025 earnings is $2.24 per share, indicating a year-over-year dip of 4.3%. The 2026 estimate of $2.55 implies growth of 13.7%. Both estimates have been trending south over the past 60 days. Image Source: Zacks Investment Research (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.) Year to date, CAT stock has dipped 0.5%, whereas VLVLY has gained 16.3%. The Volvo stock has also outperformed the Industrial Products Sector and the S&P 500, as shown in the chart below. Image Source: Zacks Investment Research Caterpillar is currently trading at a forward 12-month earnings multiple of 18.26, higher than its five-year median. Volvo stock is trading at a forward 12-month earnings multiple of 11.8X, higher than its five-year median. Both are trading at a discount to the sector average of 19.16X and the S&P 500's 22.02X. Image Source: Zacks Investment Research CAT's return on equity of 53.77% is way higher than VLVLY's 24.36%. CAT also outscores the sector's 20.4% and the S&P 500's 32.01%. This reflects Caterpillar's efficient use of shareholder funds in generating profits. Image Source: Zacks Investment Research Caterpillar and Volvo Construction Equipment are navigating near-term challenges, as evident from the recent results, the earnings estimate revision activity and the expected decline in the current fiscal-year results. However, both are poised well for long-term growth underpinned by global infrastructure needs driven by GDP growth, urbanization, regionalization and e-commerce. Despite a higher valuation, Caterpillar's return on equity is significantly higher and it currently carries a Zacks Rank #3 (Hold). Volvo has a Zacks Rank #4 (Sell) at present. Investors looking for exposure to construction equipment might consider Caterpillar to be the more favorable option at this time. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Caterpillar Inc. (CAT) : Free Stock Analysis Report AB Volvo (VLVLY) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
