Hey Snackers,
Mark Zuckerberg is putting MLB players to shame: Zuck’s signed Little League baseball card, which he had gifted to a camp counselor as a child, was sold by the counselor at auction for $105K.
Stocks slinked back into the red yesterday: the S&P 500 hit its lowest intraday value since 2020 and closed at a fresh 2022 low. Apple fell 5% after being downgraded by Bank of America on demand worries, dragging down the broader market. To top it all off, the latest GDP reading confirmed that the US economy shrank for two-straight quarters: the technical definition of a recession.
Amazon boosts worker pay ahead of the holidays, but it’s not enough to beat the inflation Grinch
Prime time… for a raise. Amazon will bump average starting pay for delivery and warehouse workers from $18/hour to more than $19/hour. The Zon says the hike will cost nearly $1B over the next year. Though small, the boost could help attract workers ahead of the holidays (which, FYI, are expected to be less frantic than last year as demand softens). It’s not the only one:
- Target: In February, Target announced it would set a new starting range of $15/hour to $24/hour. It’s trying to hire 100K workers this holiday season (less than last year).
- Walmart: Last September, Walmart lifted its minimum store wage from $11/hour to $12/hour. This season, Walmart wants to hire just 40K workers (vs. 150K last year).
- In context: Real hourly earnings (adjusted for inflation) have fallen 2.8%, and an estimated 70% of surveyed workers are looking for extra gigs to afford high prices.
Pay to keep unions away… Tensions have been rising between Amazon and its front-line workers. In April, Amazon’s Staten Island warehouse became its first US facility to unionize. Amazon tried to reverse the vote and has actively fought union organization efforts, but pumping pay could be a more subtle approach.
America’s retailers set the standard… of America’s wages. After the federal government, Walmart is the country's largest employer with 2.3M global workers, followed by Amazon with 1.5M. With a federal minimum wage of just $7.25, retail behemoths boast major influence over America’s paychecks. A boost from Amazon could pressure other employers to keep up. But this pay hike won't come close to matching inflation, with prices up 8.3% in August from a year earlier.
Peloton starts selling bikes at Dick’s, hoping brick-and-mortar will spin its fortunes around
Shifting gears… Peloton is taking a new strategy for a spin: yesterday the home fitness biz said it’ll sell its products at Dick’s Sporting Goods, its first brick-and-mortar partnership. Peloton aims to have its $1.4K Bikes and $3.5K Treads in 100+ Dick’s stores in time for the holidays. It’s in line with Peloton’s strategy to do less by itself:
- Outsource sales: Originally, Peloton only sold products directly to customers. But after sales slumped as gyms reopened, Peloton began selling on Amazon in August.
- Outsource production: In July, Peloton said it would stop making its own hardware to save $$ on pricey US production.
- Cut costs: Peloton cut 800 jobs in August in an effort to slash expenses as its quarterly loss nearly quadrupled to $1.2B
- Weird timing: Despite plunging sales, Peloton unveiled a $3.2K rowing machine this month.
Mirror, mirror (off the wall)… Peloton isn’t the only fit-tech company suffering as pandemic-era home sweat sessions decline: fitness mirror company Tonal laid off a third of its staff in July to ease its losses. Lululemon slashed its annual outlook for Mirror hardware sales in December. And this week Bowflex treadmill-maker Nautilus said it’s considering selling itself.
Luxury hardware is a hard sell… Especially during a recession. Even Apple, which is outperforming the broader market, got a rare downgrade yesterday on worries of waning demand. Peloton has been called “the Apple of fitness,” but its products are less integral to daily life than smartphones and laptops. Now it’s hoping that big-name retail partnerships will revive demand for its fancy fitness products.
The Crypto Catchup…
- 📜🖊️ Policy… Fed Chair Jerome Powell said it's time for stricter DeFi regulations. While this year's "crypto winter" hasn’t damaged the traditional financial (TradFi) system, Powell said next time could be different.
- 🤔 Sus…… South Korea tried to freeze $67M in BTC it said is tied to TerraUSD stablecoin founder Do Kwon. Kwon said Terra's collapse (think: $40B investor loss) took his $$ with it, and called reports that he tried to cash out "misinformation."
- 🤹‍♀️ Quirky… The Mouse House wants a piece of NFT cheese. Disney's looking to hire web3 (think: DeFi, metaverse) legal counsel to explore the rules and regs surrounding NFT sales. Non-fungible Yodas, anyone?
What else we’re Snackin’
- Dark: Activists say at least 76 people have been killed by Iranian security forces during 12 days of anti-government protests sparked by the death of 22-year-old Masa Amini. Amini died in custody of Iran’s morality policy after being arrested on accusations that she did not cover her hair in accordance with Iranian law.
- Grid: Millions of Florida residents could face weeks without power if Hurricane Ian’s wreckage leaves the grid beyond repair. More than 2.5M Floridians had lost electricity as of Thursday morning.
- Kicks: Nike’s sales growth beat expectations, but its profit sank 22% as persistent supply issues weighed on earnings. Nike had 44% more inventory than a year ago (think: piles of unsold AF1s).
- Cuts: SoftBank plans to cut 30% of staff at its techy Vision Fund, Bloomberg reports. Last month SoftBank reported its largest quarterly loss ever as its Vision Fund lost $22B on plunging tech investments.
- IPOrsche: Volkswagen’s Initial Porsche Offering is complete: Porsche started trading yesterday in one of Europe’s largest IPOs ever, despite rocky markets. Shares popped, then closed flat, after the $72B listing.
Friday
- Earnings expected from Carnival
Authors of this Snacks own: bitcoin and shares of Amazon, Apple, Disney, and Walmart
ID: 2451654