Hey Snackers,
In case you were wishing for a way to 3D print your burger patty: this startup is 3D printing burger patties (steak also an option). Make sure to go with "double-sided."
Markets dropped as Monday's tech rally fizzled. Stocks most eager for an economic reopening like Carnival and Delta plunged. States are rolling back reopening as COVID-19 cases surge — the number of US cases nearly doubled over the past week and a half.
Dunkin’ ditches gas station locations — the fancy-fication hits a bold new level
Ditching styrofoam cups wasn't enough... Dunkin' (dropped the 'Donuts') just hit a new extreme in its fancy-fication quest. Dunkin' will close 450 locations in Speedway gas stations by the end of the year. These smaller in-station spots offer a limited menu — you hit 'em up mid-tank fill and order just "coffee."
- Not fancy enough: Dunkin' doesn't think they fit in with its fanceh chic vision (less gas pumps, more Louboutin pumps).
- From a Dunkin spokesperson: "By exiting, we will be better positioned to serve these areas with Dunkin’s newest Next Generation restaurant design."
Stirring the (coffee) pot... Over the past few years, Dunkin' has inched toward this "Next Gen" vision — but it risks alienating OG fans as it fancy-fies. Dunkin' wants:
- More Quality: It's investing $120M in fancy new brewing systems. It also gave the espresso recipe a glow up, and trained employees to be 'espresso certified.'
- More Options: Beyond Coolattas and crullers. Dunkin now offers cold brew, oat-milk lattes, and Beyond Meat breakfast sandwiches. The Speedway locations don't offer these.
- More Future: Think mobile ordering and sleek interiors. Dunkin's doing this all because...
Dunkin' wants to change its brand perception... That's because it makes more $$$ from premium drinks and alt-meat sandwiches than $2 cups of joe and glazed donuts — Espresso now makes up 10% of Dunkin's sales mix. The Speedway locations account for a small fraction of Dunkin's sales (less than 1%), but they have a big impact on its brand perception. Dunkin' is crushing the lowest part of its brand identity: Speedway Dunkin-ettes.
Under Armour tries to sell MyFitnessPal, its $475M (likely wasted) acquisition
Calculating calories in a "medium" avocado... Acquisitions get a lot of buzz, but today we've got an un-acquisition on our hands. Under Armour bought MyFitnessPal back in 2015 for a caloric $475M. Now it's trying to sell the diet tracking app, according to The Information. Let's rewind to a time when UA was trying to expand beyond apparel:
- 2013-2015: UA snatches up health trackers MapMyRide for $150M, MyFitnessPal for $475M, and Endomondo for $85M. All so you can log that 153-calorie bag of Cheetos (+ an almond) and burn it off in a cal-tracking workout.
- 2019: These apps made up less than 3% of UA’s sales. Besides monetizing with subscriptions and ads, UA didn't use them to create a holistic fitness brand. It didn't merge them into a UA app, or leverage them to drive apparel sales through recommendations.
Protect This Clearing House... As consumer tastes shifted, Under Armour focused too much on the "ath," not enough on the "leisure." Its 2019 sales grew just 1.4% (compared to Lululemon's 24% growth). Now the corona-conomy is messing with its financial struggles:
- UA expects sales could fall 50%-60% this quarter — it took a $590M loss last quarter on corona-closed stores.
- It's planning to cut $325M in costs for 2020, and just canceled its $280M UCLA apparel deal. The MyFitnessPal sale could be another sacrifice in this cost-slashing plan.
Big acquisitions have big opportunity costs... UA spent $710M on three fitness apps that seemingly haven't done much to help its brand. What could Under Armour have spent that money on instead — aka what was the opportunity cost? UA could have acquired or built its own athleisure line to slow Lululemon's threat. It even could have tried to buy a company like Peloton which was worth way less than $710M when Under Armour splurged $710M on these apps.
America's two largest rooftop solar companies merge after a rainy COVID season
Soaking up that summer sun... Residential solar energy company Sunrun is acquiring Vivint Solar in an all-stock deal valued at $3.2B. Vivint stock soared almost 40% on the news, and SunRun shares jumped 23%.
- The combined companies are expected to save around $90M per year thanks to the merger by cutting redundant activities (book 1 TV ad instead of 2, pay 5 solar lawyers instead of 10).
- Together, they'll have almost 500K customers and will join their solar sales forces for more growth on your roof. The marriage gives investors renewed hope after...
Corona-conomy rained on solar... On one hand, the pandemic made cost saving and self-sufficiency sexier. Home solar allows you to ditch the $100/month electricity bill and harness free energy (aka sunlight) from panels on your roof. But you still have to pay to get them installed, even with $0 down monthly financing.
- No door-to-door salespeople: The solar industry had one of its worst quarters in years, as companies were hard-pressed to not make in-person sales.
- Delayed installations: The lockdown caused delays in permits and installations, which slowed sales significantly.
- Double whammy: Sunny states with expensive electricity are perfect for solar adoption (like CA, FL, and AZ), but they've been seeing some of the biggest COVID surges. Not good for the solar biz.
Solar has a customer acquisition problem... Even for those who aren't motivated by renewables/the environment, solar can save $$ on monthly electric bills. But only around 2% of US homes are using solar power. That's partly because the market is absurdly fragmented: there are 10K solar companies and no clear industry go-to. Consolidation could help a national brand emerge to bring solar mainstream.
What else we’re Snackin’
- Zing: Walmart will launch a $98/year Amazon Prime competitor (Walmart+) later this month — in the cart: same-day delivery.
- Uncensored: Facebook, Twitter, and Google stop reviewing requests for user data from Hong Kong after China imposed its authoritarian law there.
- Censored: Sec. of State Pompeo says the US "is looking at" banning TikTok for its suspected ties to the Chinese Communist Party.
- Podcash: Radio giant SiriusXM may buy E.W. Scripps's Stitcher podcasting unit for $300M to tune into the pod surge.
- eBag: Uber launches grocery delivery in Latin America and Canada — it'll launch in the US later this month.
- Vax: The US gov awards $2B to drugmakers Novavax and Regeneron for development of a potential COVID vaccine.
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Wednesday
- Major League Soccer kicks off at Disney World
- Earnings expected from Bed Bath & Beyond
Disclosure: Authors of this Snacks own shares of Uber, Alphabet, Microsoft, Lululemon, Twitter, and Amazon
ID: 1237421