🚀 SpaceX’s “bankruptcy” alarm
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Hey Snackers,
Some people came to America on the Mayflower, but others are journeying to the metaverse aboard the Metaflower. A digital mega-yacht with two helipads and a DJ booth just sold for a record $650K.
Stocks rebounded today, shrugging off Omicron fears, as the World Health Organization suggests some vaccines can still protect against the variant.
Elon says SpaceX faces a “bankruptcy” crisis, but it’s more about pressure than $$$
You’ve got Email... Elon mail. It's the day after Thanksgiving. SpaceX employees are still digesting pecan pie, when Elon Musk sends a company-wide email that would give anyone indigestion: The lack of progress in developing Raptor rocket engines has created a “genuine risk of bankruptcy” for SpaceX. Employees spit out their pie as Elon intensifies:
- Not to make you feel bad, but Elon was going to take his first weekend off in forever, yet instead he’ll be “on the Raptor line all night and through the weekend."
- Cancel Black Friday. Elon’s not sugarcoating it: “We need all hands on deck to recover from… a disaster."
Starships were meant to flyyy... Nicki Minaj's 2012 banger is also the name of SpaceX's next-generation rocket being developed in Texas. Starship will first be used to take humans to the moon for NASA's Artemis program. Then the fully reusable rocket will launch cargo and people on missions to Mars. But before Starship can fly, SpaceX needs to fix issues plaguing production of its Raptor engines.
- Starship rockets are also necessary to launch the next generation of SpaceX’s Starlink satellites. The first gen are major money losers.
- With its Falcon rocket, SpaceX has launched 1.7K first-gen satellites, with 140K customers paying $99/month for high-speed internet. But only Starship can launch the next version.
Sometimes pressure is the greatest motivator... SpaceX has raised billions, leading it to cross a massive $100B valuation. Investors are eager to continue funding it, plus its CEO is Earth’s richest person. And Elon has conceded that even if a global recession were to hit, a SpaceX bankruptcy is unlikely. But he has also underscored: "Only the paranoid survive." Elon knows that fear sometimes drives results more than complacency. So he's raising alarms to motivate employees to reach SpaceX's ambitious goal of flying Starships at least once every two weeks next year.
Black Friday sales looked darker this year, as two trends reshape shopping habits
Scrambling for Baby Yoda toys… The force isn’t with you this holiday season. For the first time ever recorded, online shoppers spent less on Black Friday and Cyber Monday than the year before. But it isn’t because Americans aren’t splurging: Holiday shopping is expected to hit a record $843B this season. And while online sales dropped during Cyber Week (Thanksgiving through Cyber Monday), online sales from all of November rose from last year.
Extra pricey and extra delayed… As the global economy recovers from the pandemic, inflation has hit a 31-year high and global-supply clogs have led to major shipping delays. Two shopping trends have emerged:
- Early sales: Target, Amazon, Macy’s, and Best Buy launched Black Friday-style deals in October to get ahead of shortages, so buyers started shopping earlier and spreading their purchases out over time.
- BNPL boom: To help pay for pricier products (#flated), shoppers paid with “buy now, pay later” 5X more in November than pre-pandemic. PayPal saw a 5X increase in installment payments on Black Friday vs. last year, and rival Klarna saw a 4X increase.
The holiday “spread” is replacing the holiday crunch… And we’re not talking Nutella and gingerbread cookies. Two global economic issues — inflation and supply disruptions — are transforming shopping habits. Holiday shopping is lasting longer and being paid for in installments more often. Still, spread out doesn’t mean small: Spending is expected to keep rising next year despite supply constraints and rising prices.
What else we’re Snackin’
- Boost: GM raised its full-year earnings forecast thanks to soaring car prices and increased chip supply, but it doesn’t expect inventory to normalize until 2023.
- Pumped: Exxon plans to double its earnings by 2027 while reducing emissions, as oil giants face pressure to embrace renewables.
- Unmatch: Tinder and Hinge owner Match settled a lawsuit that had alleged it undervalued Tinder to cheat its founders out of billions, agreeing to pay $441M.
- Closed: China plans to end a loophole that allows companies to go public on foreign exchanges, which could force names like Alibaba and Didi to delist in the US.
- eGoal: To engage fans, English soccer club Manchester City teamed up with Sony to create a metaverse out of a virtual version of its Etihad stadium.
- Superapp: Grab, the Singapore-based ride hailing, food delivery, and payments app, is expected to start trading on the Nasdaq today at a $40B market cap.
Thursday
- Weekly jobless claims
- Earnings expected from TD Bank, Dollar General, DocuSign, Kroger, Asana, Smith & Wesson Brands
Authors of this Snacks own shares of: GM, Match, and Amazon
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