🍔 McDonald’s big, beefy gamble

Thirty years ago, McDonald’s released its most infamous and expensive flop, the Arch Deluxe. Marketed as a burger with a “grown-up” taste, it promised culinary transcendence through premium ingredients, years of research and testing, and the then exotic siren scent of dijonnaise sauce. It was a misfire so catastrophic, it’s become material for MBA case studies and corporate cautionary tales. But tomorrow, McDonald’s is launching an eerily similar gambit with the Big Arch.

The timing of the luxe launch is somewhat surprising:

• After alienating its core consumer base with the continuation of higher prices from the pandemic, McDonald’s and several other fast-food chains have just begun to see diners returning.

• In its last earnings, McDonald’s reported that it had smashed analysts’ expectations at the end of 2025, with same-store sales rising 5.7%.

• Anchoring the surges in sales and traffic were discounts, including value-enhanced combo meals priced 15% lower than their individual items. In a rare and controversial move, McDonald’s even helped subsidize the discounts by splitting the costs with franchisees. 

But there are some tasty reasons to try something new:

• A burger with more meat and less bread than a Big Mac fits naturally within an American consumer culture that’s in a sustained fit of protein-maxxing.

• Additionally, quick-service chains like McDonald’s have enjoyed a boost from higher-income diners who are either unfazed by the high cost of fast food or might be trading down from pricier options.

• Even as McDonald’s introduced discounts and brought its lower-priced Snack Wrap out of retirement last summer, it acknowledged how the winners in the bifurcated US economy have helped keep its losses from becoming supersized.

The Takeaway

In many ways, Mickey D’s investment in the Big Arch speaks to its outsized fixture in the world of food. The American monoculture may be on its last legs, but McDonald’s is still McDonald’s. It found success last year by reviving its “Monopoly” promotion and, in December, briefly held the title of the world’s largest seller of socks through a hugely successful Grinch-themed holiday meal promotion. Even as the Big Arch sounds a lot like the same corporate hubris that gave us the Arch Deluxe, anyone witnessing the re-proliferation of cargo pants and digital cameras knows that even the most disastrous elements of the 1990s have the potential to break through in 2026.

Read more

• Chopping Block: Sure, Jack Dorsey’s Block reported $6.25 billion in Q4 revenue, ahead of expectations, but it was his announcement that the company is cutting 40% of its 10,000-person workforce that really sent the shares skyrocketing. It wasn’t just traders who liked ​​Block joining many other companies tying job cuts to AI, but analysts loved it too, with Morgan Stanley calling it an “audacious move,” though others had a more nuanced view.

• Energy drinks are soaring — but Red Bull still flies highest: Last week, energy drink giant Monster Beverage reported net sales of $8.3 billion for 2025 — an all-time high. Fast-growing energy drink brand Celsius also reported some boosted figures, with sales rocketing 86% to $2.5 billion in FY2025. Still, even as rivals shift cans at record rates, these numbers pale in comparison to Red Bull, and it’s not even close.

More US teens are using AI, as 54% of 13- to 17-year-olds reported using chatbots to help with schoolwork in 2025, up from 13% two years ago. But as more teens are turning to chatbots for help researching, editing, problem-solving, and entertainment, they aren’t all entirely optimistic about AI.

See what teens think the impact of AI will be in 20 years.

• ⚾️ Baseball: The World Baseball Classic is coming up, and even if a few star players are missing out because of a weird insurance situation, it’s bound to be some of the most exciting early baseball of 2026. Prediction markets* have the United States as the team to beat, with a 51% chance of coming out ahead, but don’t sleep on Japan (22%) or the Dominican Republic (18%). 

• 📺 Warner Bros.: The news that Netflix pulled out of the bidding for Warner Bros. Discovery sent Paramount’s chances of owning the company rocketing up from 56% all the way to 89%. Eagle-eyed investors may observe that is decisively not 100%; the 11% balance is in favor of nobody winning Warner, with the deal presumably blocked at some level. If the offer succeeds, a company losing $573 million a quarter will get to buy the company losing $252 million a quarter for $111 billion, and what could possibly go wrong?

*Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.