Soldiers of fortune fight for gold, but superpowers strike mineral deals. 

President Donald Trump said on Tuesday that he wants Ukraine to supply rare earth minerals to the US in exchange for continued military aid. The stuff would come in handy, as China said it was responding to new US tariffs by curbing the export of five critical minerals. 

It all goes to show that in geopolitics today, you can’t take anything for granite.

A Game of Economic Chicken

Rare earths are a group of 17 elements with important magnetic and electrochemical properties that are used in everything from electric vehicle batteries to wind turbines, smartphones and cancer drugs. This makes them absolutely crucial to industrial supply chains.

Ukraine, as it happens, is sitting on a fortune of natural resources, although a 2022 analysis by risk firm SecDev found Russia occupies territory with roughly $12.4 trillion worth. Still, that only covers roughly one third of Ukraine’s rare earth deposits and 42% of its metals, meaning Kyiv maintains control of significant resources. (Moscow, which launched a full-scale invasion in 2022, had seized 63% of Ukraine’s coal deposits, 11% of oil deposits, and 20% of natural gas deposits, SecDev found.) Trump said Tuesday that he wanted “to do a deal” with Ukraine that would amount to “equalization” in exchange for military aid:

• The idea may not have actually been his. The Kyiv Independent reported Monday that Ukrainian President Volodymyr Zelenskyy floated the idea to American officials as a way of retaining US aid, which totaled $175 billion in emergency support and $53.7 billion in direct military support as of last May. In return, the US would have less exposure to China, which produces 60 percent of the world’s rare earths and processes 90 percent.
• And speaking of the Middle Kingdom, Beijing took a stab at US mineral supplies Tuesday after Trump escalated the trade war between the two countries by slapping additional 10% tariffs on all imports. China said it will restrict the export of five strategic, though not rare earth, metals — tungsten, tellurium, bismuth, indium, and molybdenum — to “safeguard national security.” The metals are used in armour plating, alloys, medications, memory chips, solar panels, and for dozens of other purposes.

Kremlin spokesperson Dmitry Peskov, for what it’s worth, told reporters Tuesday that the US should “not provide assistance [to Ukraine] at all.”

The Art of the Deal: Trump, a longtime real estate mogul, is of course still angling for his biggest deal of all time: Greenland. Both the autonomous Danish territory and Denmark’s government have told him the island, where 100 permits have been granted for companies to search for viable mineral deposits, is not for sale.

Vaccine-makers sure could use some inoculation from recent marketplace maladies.

In a crushing blow, pharma giant Merck on Tuesday announced in its earnings report that it would halt all shipments of HPV drug Gardasil to China as “market dynamics remain challenging.” The news comes just a day after Pfizer’s earnings call showed yet another substantial drop in demand for its Covid jab. And all while noted vaccine skeptic Robert F. Kennedy Jr. trudges closer and closer to Senate confirmation to lead the US Department of Health and Human Services.

Call Your Shot

Merck has been staring down the barrel of a China problem for months now. In July, the company lowered its guidance for 2024 in large part due to slower than expected Gardasil sales in the nation, a market that was expected to propel the vaccine to blockbuster status and fill a looming void for the company once its Keytruda patent expires in 2028. On Tuesday, Merck said Gardasil shipments to China would stop until at least midyear (though the firm will continue selling its current supply there). Merck also rescinded its forecast of $11 billion in sales for the vaccine this year.

The result? Merck’s biggest intraday trading loss in nearly five years: Shares of Merck closed down around 9%. But the company was hardly the only pharma player feeling the heat on Tuesday, as the Republican-controlled Senate Finance Committee advanced RFK Jr.’s nomination to lead HHS:

• Shares of Pfizer were down over 1%, shares of BioNTech were down over 2%, and shares of Moderna fell 6.5%. Also notable were dips in the shares of snack food companies, which are similarly in the crosshairs of the Make America Healthy Again campaign; shares of Hershey’s, Kraft Heinz, Mondelez, and General Mills were all down around 2%.
• Republican Senator Bill Cassidy, a medical doctor who turned into the key swing vote on the committee, said he ultimately voted to advance RFK’s nomination after receiving “serious commitments” on tackling shared issues, like healthy foods. Cassidy had previously expressed deep concerns with Kennedy’s vaccine skepticism.

Up and Down: Pfizer, meanwhile, had a slightly more mercurial week. On the one hand, sales of its Covid shot continued to fall off a cliff, with revenue for its vaccine down some $2 billion in the last three months of 2024, compared with a year earlier. But its other Covid products — namely the antiviral treatment pill Paxlovid — are seeing strong demand. Paxlovid generated $727 million in the quarter, a massive U-turn from the year before when a non-cash accounting adjustment dragged revenue $3.1 billion into the red.

Wise men including but not limited to Elvis Presley say only fools rush in, and Spotify has certainly taken its sweet time achieving profitability.

On Tuesday, the streaming colossus reported its full-year results for 2024, revealing it turned its first-ever annual profit to the tune of €1.14 billion ($1.2 billion). It’s the first real glimpse we’ve had of annual profitability for a major music streamer, as many of Spotify’s biggest competitors in the space are owned by Big Tech companies that bundle their music streaming revenues together with other services.

The Long and Winding Road

To give some perspective on Spotify’s long road to steady profitability, the company was founded in 2006. It’s pretty extraordinary that TV and film streamers like Netflix were able to hit annual profitability ahead of Spotify when you consider the overhead they pour into producing shows and movies, but here we are. In Spotify’s case, overhead has turned into a badge of honor — last week as a sort of curtain-raiser to Monday’s results, it announced it had paid the music industry a total of $10 billion in 2024.

Yet even as it was handing out cash to the music industry, Spotify was trimming costs elsewhere. An ingredient in its newfound profitability is a slimmed-down workforce:

• The company announced it was cutting 17% of its workforce in late 2023, totalling 1,500 jobs. That followed 800 pink slips earlier in the year, meaning a total reduction of 23% since 2022.
• Spotify’s profitable year wasn’t solely due to cost-cutting, as it also announced a surprisingly chunky increase in the number of subscribers, which climbed 11% in the fourth quarter from a year earlier.
  

Silent Competition: Big music streaming rivals to Spotify include YouTube Music, Apple Music, and (to a lesser extent) Amazon Music. These streaming platforms are part of much bigger tech companies than Spotify, and so their exact revenues and losses are harder to scrutinize, making it tough to get a grip on exactly how Spotify is performing in relation to its peers. One thing that seems clear: Spotify has a much, much bigger audience than the Big Tech companies’ offerings. This time last year, YouTube’s Global Head of Music Lyor Cohen said the platform had reached 100 million subscribers. At the same time last year, Spotify announced it had 236 million paid subscribers, and 602 million monthly active users.