🍔 MrBeast’s burger bust
Hey Snackers,
Linda, once a staggeringly popular name (1 in every 18 girls born in the US in 1947), has fallen off hard, ranking 807th last year. The L.I.N.D.A. Club, made up entirely of Lindas, recently held its 35th convention. On the agenda: recruit younger Lindas.
Stocks fell yesterday, a day after the S&P 500 posted its biggest loss since April. The index ended July up ~20% on the year, leaving investors worried that a pullback could be ahead. After the close, Amazon crushed earnings expectations and Apple beat soft forecasts.
MrBeast sues the ghost kitchen making his MrBeast Burger as the ghost concept struggles
Ghosting ghost kitchens… No. 1 YouTuber Jimmy “MrBeast” Donaldson is suing Virtual Dining Concepts after fans who ordered MrBeast Burgers prepped by the company’s ghost kitchens reportedly called them “revolting” and “inedible.” Refresher: ghost kitchens prep food for delivery and pick-up. MrBeast Burger reviews have been mixed since it launched to mass hype less than three years ago because of quality-control issues. Now MrBeast wants to break his contract with VDC and shut down his burger biz.
Response: VDC says the suit is “riddled with false statements and inaccuracies” — and that it plans to keep selling MrBeast Burgers.
Not the first: Other celeb-backed ghost-kitchen endeavors have been criticized for selling subpar foods, including Tyga’s and David Chang’s.
Ghost food struggles with transparency… ironically. A single kitchen can operate several restaurants, and all that multitasking can make it hard to maintain quality control and enforce health and safety codes. Ghost kitchens exist in a regulatory gray area (since they’re not traditional restos), and while officials hash out new policies for the biz model, problems are stacking up:Â
CloudKitchens (created by Uber’s founder) lost numerous restaurant partners last year after an Insider report said many of its kitchens didn’t have basic sanitary features, including working sinks.
Reef Technology is pivoting to selling its software after some of its mobile kitchens (trailers) racked up health and safety infractions, including leaking sewage and explosions.
Food can’t scale like tech… Ghost-kitchen startups were hailed as dining disruptors and scored huge investment rounds during the pandemic (when everyone was ordering pad thai 2X a week). But the companies may’ve used that $$ to open too many locations too fast, sacrificing quality and safety.
Meta’s Ray-Ban smart glasses see little use as owners leave face wearables in the drawer
Stop trying to make face happen… The results are in, and Meta’s got vision problems. According to company docs scored by The Wall Street Journal, the tech titan’s Ray-Ban Stories smart glasses (picture: built-in cameras, mic) look to be a flop. The internal report showed that as of February, fewer than 10% of the glasses were being used — that’s only 27K users out of the 300K glasses said to have sold. Meta reportedly hoped to move 478K.Â
Ray-Banned: Launched nearly two years ago in partnership with glasses giant EssilorLuxottica, $300 Ray-Ban Stories were met with mixed reviews and privacy concerns.Â
New frame who dis: Meta is said to be working on a second gen of the camera-equipped glasses, aiming to release them by next spring.
It's not just Ray-Bans… Meta has struggled to get shoppers on board with its face-wearable vision. It recently slashed the price of its Quest 2 and Quest Pro headsets, and Meta’s Reality Labs division saw a nearly $8B operating loss in the first half of this year. (FYI: last week Meta said it would rework virtual reality Horizon Worlds following glacial user growth.) But the issue may be bigger than Meta: other attempts at face gadgets like Google Glass and Snap Spectacles also flopped. That Ray-Ban Stories (which look like regular trendy glasses) may be failing, too, could point to a broader issue.
Incremental tweaks can’t fix fundamental flaws… Despite sluggish sales and low user #s, Meta has marched forward with newer versions of its face wearables. Now Apple plans to enter the ring with its $3.5K Apple Vision Pro early next year. But it may not find any more success than previous entrants if the fundamental issue is that people don’t want computers on their face. BTW: an early reviewer called Apple’s new AR headset experience “awfully isolating.”
The Crypto Catch-Up…
💎 Sparkly… The SEC said the creator of hex, an ethereum-based token, spent investors’ $$ on cars, watches, and a 555-carat diamond dubbed “the enigma” after raising $1B+ in three unregistered securities offerings. Hex is down 98% from its 2021 high.
⚖️ Judgy… A couple, including financial rapper Razzlekhan, pleaded guilty to money-laundering charges relating to the 2016 Bitfinex hack (authorities recovered $3.6B in crypto). Razzlekhan faces up to five years in prison, and her husband up to 20.
🌶️ Spicy… Coinbase said the SEC did not tell the exchange to delist specific crypto assets before suing it. Last week, the Financial Times quoted CEO Brian Armstrong as saying that the regulator told his exchange to delist every crypto except bitcoin.
What else we’re Snackin’
Meh: Apple beat modest expectations, fueled by services growth (App Store, Apple Music). But hardware slowed across the board, with iPhone sales down 2% and Mac down 7%, as folks rein in tech splurges.Â
Primed: Amazon stock spiked 7% after it gave sunny guidance and returned to double-digit sales growth, with revenue up 11% last quarter. Amazon’s ad biz continued to be one of its fastest-growing units.Â
It’sAMe: Smash-hit IP gave Nintendo a Super Star-sized boost last quarter. “Zelda” helped push 4M units of the seven-year-old Switch console, while its “Mario Bros.” movie dominated the box office.
OnTheWay: Americans’ delivery appetite remains strong. DoorDash reported a record 532M orders last quarter, and its share of the US food-delivery market rose to 65%. Rival Uber’s delivery bookings grew 12%.Â
Suds: AB InBev beat profit forecasts despite a Bud Light boycott that saw the beer lose its top-selling US brew spot to Constellation’s Modelo. Its US revenue fell 10% amid the Bud boycott.
Friday
Nonfarm payrolls
Earnings expected from Cinemark and FiskerÂ
Authors of this Snacks own bitcoin and ethereum and shares of: Amazon, AB InBev, Apple, Google, Snap, and Uber
Correction: Because of a CMS glitch that failed to publish an italicized word in a hyperlink, an earlier version of this newsletter misstated that Coinbase said the SEC told the exchange to delist specific assets. Coinbase actually said that the SEC did not tell it to. We regret the error.