🟢 9 Strategic insights for 2025 - 7. The slow incumbents' extinction

The core insight

A wave of extinction seems to be hitting many of the industry leaders of the last decades. This is not a random event. The underlying forces of the market are changing irrevocably, and just like Intel or Boeing, anyone can be the next Kodak.

The discussion

We're getting to the end of what I believe are important strategic insights to position yourself for next year's turbulence. After discussing that there is no digital market per se anymore, how robotization might come in sooner than expected, that geopolitics will be at the center of your troubles (or opportunities), how tech hype became predominant, the surge of price radicalization, why innovation centers are (mostly) done, but need to talk today about incumbents and giant leaders are falling from grace.

The easiest explanation would be just to go back to the list of troubles I've painted up to now and simply point at these. But there are other deeper, much more structural reasons why leaders are becoming extinct.

Which extinction, again?

Over the last five years, Boeing shed 58.2% of its value while comfortably seated in a seemingly unchallengeable worldwide duopoly with Airbus. Yes, there was the pandemic, but also a sky-high rebound after that, as Airbus's global 15% stock value increase over the same period testifies. Boeing? Stuck in a fundamental culture shift where financialization, short-term gains, drastic cuts, and quality control became predominant, they most the script and became a liability to their customers in a market where safety should be paramount. As this is a singular duopoly and quite a zero-sum game, I could even argue that Boeing's total fall was indeed 58+15 = 73%!

In the semiconductor market, Intel lost 49.2% of its value, not only missing the AI boat but so many other market turnarounds before, starting with the shift to mobile. Once the most fearsome giant in this market, Intel will now be forced to become the Foxconn of AMD and Nvidia, manufacturing some of their production as cheaply as possible.

In the consumer market, Nike lost 54.27% of its peak 2021 valuation and 23% in 2023 alone. The reasons? a pile of bad management decisions, losing sight of its brand value, and an inability to reinvent itself.

I could go on and on about 3M, Salesforce, Estée Lauder, any automotive company (yes, including Tesla, which is by now a stock market time bomb), and so many others, but you get the picture.