Hey Snackers,
The hot new star of New York Fashion Week: Lowe's. NYFW designers are partnering with the 100-year-old retailer to bring home decor to the runway. Let's hope the potted ferns don't trip in their heels (#faceplant).
The S&P 500 and the Nasdaq rose to all-time highs again — the indexes have hit fresh records for four straight trading days.
Urban Outfitters surges on a surprise profit (it's a techy fashion smoothie)
The Urban Anthropologie of Free People... That's a mouthful, but apparently a profitable one. Urban Outfitters is the boho-chic retailer that supplies the distressed denim jacket of your high-school dreams. Urban also owns Free People, where a floral tank costs $60, and Anthropologie, where a candle costs more than your car insurance.
- Urban lost $138M during the January-April quarter. Sales plunged across all three of its major brands as Urban stores closed for lockdowns. Analysts were expecting another loss during May-July.
- Surprise! Urban turned a $34M profit. All its brands were profitable and new digital customers jumped 70%. Urban stock popped 21% on the earnings shocker.
Slim fit inventory... Urban's sales were down 17%, but it snagged a profit by keeping its inventory lean. It didn't overspend on clothes/candles/etc, so it didn't lose money when the demand wasn't there. By carefully guarding against overstocking, Urban avoided the discounting death spiral: Once you go 70% off to clear out unsold stuff, you never go back (customers never forget).
Urban is a fashion smoothie with a scoop of techy innovation... Its business is diverse, like a chocolate-banana-kale concoction. In addition to its core clothing biz, Urban sells home decor, food, and skincare products. It also has a clothing rental subscription service called Nuuly. This techy scoop of almond butter makes up just ~1% of Urban's sales — But Nuuly's sales have doubled since last year. It's the kind of innovation you don't see with OG clothing retailers.
Salesforce surges 26% on a record quarter — meet the new member of Club Dow
Always be closing... The company that powers sales teams around the world just notched killer quarterly sales itself (#meta). Enterprise cloud software-maker Salesforce had a great week. On Monday, we found out Salesforce is joining the Dow (and oily Exxon got booted). The elite-ish index tracks the stocks of 30 of America's largest companies.
- Salesforce stock ticked up, since fund managers who track the Dow will have to buy Salesforce shares to match the index. Then, on Wednesday...
- Salesforce stock soared 26% on word that quarterly sales jumped 29% to over $5B for the 1st time. Salesforce added over $60B to its market value in just one day.
WTF is "CRM"... It's Salesforce's stock ticker, and also its bread-and-butter: Customer Relationship Management. CRM apps help salespeople track their interactions with leads and prospects. That way, Tony won't forget to follow up on the Knicks tickets he sent to his hot lead. Cindy can show her manager that she called/emailed/Linkedin'd FP&A Bob 135 times. Reps who take over an account or join a deal cycle can see all the info from past interactions.
It's all about the Total Addressable Market... That's Salesforce's total sales opportunity. If a company a) sells things and/or b) has customers to support, they’re part of Salesforce’s TAM (if they can afford it). Since 2006, Salesforce has acquired dozens of companies to expand its biz and TAM. That broad mix of cloud-based business applications is thriving in the WFH economy.
What else we’re Snackin’
- ZuckIt: Facebook says that Apple's new iOS update could lead to a massive 50% drop in its revenue from targeted mobile ads.
- Crewneck: J.Crew gets the greenlight for its debt reorganization plan, setting it up to emerge from bankruptcy with a fresh start next month.
- Dicky: Dick's Sporting Goods's online sales nearly tripled on your pandemic hiking habit (kayak demand surged).
- Vax: Biotech firm Moderna says its COVID vaccine shows promising results in a small trial of older patients.
- Nordy: Nordstrom's sales plunged 53% after falling 40% in the previous quarter — online sales dropped, too.
- Augment: Apple is reportedly adding AR content to Apple TV+ streaming. Think: dolphins on your iPad while Free Willy is on the TV.
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Thursday
- Weekly jobless claims.
- Earnings expected from Coty, Workday, Ulta, and Dollar General
Disclosure: Authors of this Snacks own shares of Apple
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