💼 Amazon’s RTO fail
Hey Snackers,
Hallmark’s found its soulmate: reality TV. The channel known for treacly rom-coms teased “Small Town Setup,” a show that sends big-city singletons home to meet matches chosen by their neighbors and family. Who wouldn’t want to be a part of that?
The S&P 500 plunged nearly 3% yesterday, its second-worst day of the year, after Fed officials signaled they’re penciling in just two rate cuts next year (and trimmed rates by a quarter point, as expected). The Dow fell for the 10th straight trading day — its longest losing streak since 1974.
Amazon delays its full-time RTO because it doesn't have enough office space
Order more office?… Amazon’s struggling to deliver on its 5 day/week in-office mandate. In September, it ordered its 350K+ corporate employees to be back in the office full time by January. Update: the ecomm leader reportedly told staff in Atlanta, Houston, Nashville, and New York to cool their RTO heels. Apparently, Amazon doesn’t have enough desk space for its white-collar workers. Business Insider reported that Amazon told some employees to stay away until May, and it’s unclear how (or if) the company intends to solve its space problem. Amazon’s said to be bailing on office construction plans and breaking leases to save $1.3B.
Backdoor layoffs? Amazon’s mandate was criticized by employees, some of whom said it was a sneaky way to cut headcount while avoiding layoffs. Nearly 75% of employees are said to have considered quitting because of the rule.
Primed for problems: Amazon’s struggled with square footage before. When it announced a required 3 days/week in the office last year, it was also short on space.
Doin’ it differently… Amazon’s full-time office mandate bucks a larger trend: corporate America has landed on a hybrid schedule. That could partly explain why there’s 900M+ square feet of empty office space in the US, putting the vacancy rate at a 30-year high of 20%. Around 70% of US companies offer hybrid work, and new data shows that employers with flexible schedules have seen outsized hiring growth compared to their fully in-office peers.
Stayin’ away can pay… Companies that’ve tried hybrid or remote work have seen millions in savings on real estate and in-office costs. Plus, offering flexible policies can help companies attract and retain top talent. While studies have found that hybrid work doesn’t hurt productivity and ups morale, many execs pushing RTO believe that in-person work boosts collaboration and other intangibles.
The pharma CEO who invented his own cure
🧪 Self-made… Facing recurrent infections with a 70% fatality rate and no cure, Bradley Burnam decided to develop it himself. The result was Hexagen — a formula he took through the FDA clearance process himself for $24,000.1 Burnam then expanded the technology, achieved 2 more FDA clearances, and founded a company: Turn Therapeutics.
🔍 Beyond skin deep… Hexagen is cleared for acute wound care and management of atopic dermatitis — and Turn is now expanding the indications of its flagship formula.
🤝 Backed… Turn just secured an investment commitment of up to $75M from GEM Global Yield Fund, a private equity firm. This agreement is tied to a future public listing of Turn’s stock.2
Turn is currently inviting institutional, accredited, and unaccredited investors to participate in their current crowdfunding campaign — but only until January 2025.3
KFC owner Yum Brands launches a saucy spinoff as fast food finds its savior in chicken
Ketchup is shaking… Yum! Brands is betting people want to buy the dip. Next week, the fast-food titan plans to open a hot pink KFC spinoff called Saucy centered around — you guessed it — sauces. Customers can order sauce flights from a list of 11 options (five of them are variations on ranch) to pair with chicken tenders. The first Saucy will be in Orlando, and Yum said it’s planning to open more locations. It’s the Taco Bell and Pizza Hut parent’s latest attempt to fix its sales slump.
Empty buckets: Last month, Yum reported a 5% drop in KFC’s quarterly same-store US sales, marking the third straight quarter of declines for its fried chicken chain. Pizza Hut’s sales also fell, while Taco Bell’s continued to grow (it’s the jewel of Yum’s portfolio).
Fast ain’t enough: Price hikes have ticked off fast-food customers. Now, chains like McDonald’s and Burger King are pushing promos and new menu items to lure back diners.
Tastes like chicken… On the surface, Saucy is about the sauce — but it’s also a fresh way to hawk chicken, which has become the star of the fast-food world. The number of hen-based menu items eaten at quick-service restaurants is up 11% since 2019. Fast-foodies are piling new poultry items onto menus, from McDonald’s Chicken Big Mac to Applebee’s Big Cluckin’ Chicken Sandwich. Chains from Wendy’s to Shake Shack are duking it out to win the chicken sando wars. Americans are eating more and more birds, from 50 lbs a year per person in 1970 to more than 100 lbs this year.
Money clucks… While health concerns surrounding red meat likely play a role in the chicken boom, the largest factor may be price. Whole chickens were $2/lb on average last month, while ground beef rose to $5.63/lb. The chicken-cow price difference is big, and a US cattle shortage and potential meat packer greedflation hasn’t helped beef’s case.
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What else we’re Snackin’
SCOTUS agreed to hear TikTok’s challenge to a law that could ban the app in the US. Justices will hear arguments on January 10 — nine days before the law’s set to take effect.
Zero-frills airline Frontier is offering an annual “all you can fly” pass at a pre-sale price of $300. Frontier’s been trying new strategies as budget rivals like Spirit struggle.
Japanese auto giants Honda and Nissan are reportedly discussing a merger to better compete with EV titans like Tesla and BYD.
The EPA gave California the green light to ban sales of new gas-only cars by 2035, but incoming POTUS Trump could reverse the approval.
Cocoa futures prices have nearly 3x’d this year and chocolate makers like Nestle, Lindt, and Mondelez have upped prices, citing record costs.
Turn Therapeutics has 3 FDA clearances… and doctors believe its flagship formula, Hexagen, could have further applications. Big pharma execs and renowned physicians are backers — and institutional, accredited, & unaccredited investors can join the company’s crowdfunding round until Jan 2025.³
Snack Fact of the Day
Netflix spends as much on international content as it does on North American content
Thursday
Initial jobless claims
Earnings expected from Accenture, Cintas, Darden Restaurants, FactSet, Conagra, Paychex, CarMax, Nike, FedEx, BlackBerry, and Scholastic
Authors of this Snacks own shares of: Amazon, Rocket Lab, Tesla, and Yum Brands
Advertiser's disclosures:
¹ The Company's Formula (Gx-03/Hexagen/Atopx) Has Received 510k Marketing Approval As A Medical Device Indicated For The Management Of Symptoms Related To Atopic Dermatitis/Eczema. The Formula Has Not Received Approval As A Drug For The Treatment Of Eczema Or Onychomycosis.
² A plan to IPO is no guarantee that an actual IPO will occur.
³ Please read the offering circular and related risks at StartEngine’s Turn Therapeutics webpage. This is a paid advertisement for Turn Therapeutics Regulation CF Offering. This Reg CF offering is made available through StartEngine Primary, LLC, member FINRA/SIPC.
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