🏖️ Marriott’s room boom
Hey Snackers,
TikTok skills are the new Excel skills: Companies from Whole Foods to Claire’s are hiring “college creators” (cough, interns) who can crank out viral videos to promote their brands.
US indexes barely budged yesterday after January’s consumer-price report showed inflation cooled for a seventh straight month — though not as fast as investors had hoped. Prices were up 6.4% for the year, suggesting that the pace of cooling may be leveling off.
Marriott’s profit soars on the vacay-palooza, but Americans’ travel fuel could be running low
Grab the mini-bar champagne… Marriott unpacked strong earnings yesterday as people splurged on ocean-view suites at the Ritz and room service at the W. The world’s largest hotel chain — which also owns Sheraton, Westin, and many others — saw its sales rise a sweeter-than-expected 33% to nearly $6B. Meanwhile, profits surged 44%.
- Expensive nights: Marriott's revenue per available room (a key metric in the hotel industry) jumped 5% above 2019 levels thanks to pricier rates and healthy demand.
- City lights: Leisure and group trips in North America (Marriott's largest market) topped prepandemic levels, while business travel recovered to nearly 90%.
Stash the mini toiletries… With the worst of the pandemic past us, consumers are taking advantage of their regained freedom by traveling — a lot. Last year, US hotel revenue and profits hit record highs. But some of that growth was driven by higher prices (average room rates in North America surged 33% from 2019 prices). Americans have mostly stomached those hikes, but that could change as households burn through their pandemic savings.
Savings may die before demand… As savings dollars dry up, consumers could be forced to cut back on travel spend — even if organic demand is still high. Goldman Sachs predicts that Americans will’ve burned through 65% of their pandemic savings by the end of this year. Still, consumers could satisfy their wanderlust with more budget-friendly choices (think: road trips, cheaper lodging).
Regulators order the third-largest stablecoin to shut down, which could spell trouble for crypto's top exchange
When stables get rocked… New York regulators unbalanced the crypto industry this week, ordering Paxos — the crypto-services biz behind the third-largest stablecoin — to cease issuing its Binance USD (BUSD) token. Refresher: stablecoins are crypto pegged to real-world assets like the US dollar. They let folks interact with DeFi and smart contracts without the price volatility associated with other coins. But there’s a shake-up in the works:
- Destabilized: Paxos said it’ll stop creating new BUSD coins next week — and that it’ll no longer work with BUSD's brand partner, Binance.
- Axe-os: The SEC reportedly plans to sue Paxos over its sale of BUSD, alleging it's an unregistered security.
Byenance?… Paxos rolled out BUSD in 2019 and grew the coin to a $16B market cap in partnership with Binance. Now BUSD’s value is shrinking fast as investors ditch it. That could be bad news for Binance, which had seemingly solidified its crypto dominance after FTX’s fall. BUSD transactions were reported to make up 40% of the exchange’s trading volume last month. Binance's CEO, Changpeng “CZ” Zhao, said the exchange made 90% of its revenue from transaction fees. Yesterday CZ downplayed Binance’s connection to the stablecoin.
No one’s sleeping on crypto (regulation)… anymore. Last year's cascading bankruptcies at Celsius, BlockFi, and FTX left some lawmakers asking if crypto regulation was asleep at the wheel. Now regulators have downed a double espresso and set their sights on more than just stablecoins. The SEC said last week that it had reached a $30M settlement with US-based exchange Kraken over its staking program. And last month it went after Gemini's troubled Earn program.
Heard on the Block: "staking"
🤑 When you put your money where your mouth is…
Proof-of-stake blockchains like ethereum rely on people called validators to process transactions and keep the chain honest. But first validators must lock up crypto as collateral in a process called "staking." The idea: validators are less likely to do something shady if their coins are on the line. Last week, after SEC Chair Gary Gensler said that companies offering staking services must comply with securities laws, Coinbase argued staking's not a security.
What else we’re Snackin’
- Jetset: Air India ordered 470 jets from US-based plane maker Boeing and its European rival, Airbus, in the largest commercial-aircraft deal in history. Airlines are scrambling for planes as travel demand booms.
- Tested: Tesla employees in New York are trying to organize a union, which would be Tesla’s first. It could turn into a battle, though: Elon Musk has been openly against unionization.
- Eurout: EU lawmakers approved a law that’ll effectively ban the sale of new gas and diesel-fueled cars starting in 2035, which should accelerate the shift to renewables in the 27-country bloc.
- BuzzAI: Listicle legend BuzzFeed published a series of AI-created quizzes to help users learn things like which type of plant is their ideal romantic partner. Last month it said it would use ChatGPT to churn out content.
- Sparkle: Coke untapped expectation-beating quarterly sales growth, driven by price hikes for bevs like Sprite, Schweppes, Minute Maid, and… Coca-Cola. But lofty prices hurt demand for its juice and milk products.
Wednesday
- Earnings expected from Shopify, Kraft, Boston Beer, Roblox, Krispy Kreme, Wyndham, Sunoco, Biogen, Ryder, Roku, Upwork, Twilio, Cisco, and Zillow
Authors of this Snacks own ethereum and shares: of Tesla, Boston Beer, Roku, and Shopify
ID: 2740538