__Not getting vipassana meditation vibes...__ — __Elliott Management__. The huge hedge fund has bought up over $1B worth of __[Twitter](https://robinhood.com/stocks/TWTR)__ stock and is putting that power right to work — first by reportedly [nominating](https://www.npr.org/2020/03/01/810979699/jack-dorsey-twitters-eccentric-ceo-could-be-looking-for-a-job-soon) 4 new directors to Twitter's board. But Elliott also reportedly wants to remove/replace Twitter's CEO/co-founder Jack Dorsey. They think Twitter's better off with a new CEO because...

- __He's (too) quirky:__ Silicon Valley founders are known for their visionary-ish eccentricity. Dorsey takes it to another level: 10-day silent [vipassana meditations](https://twitter.com/jack/status/1071575088695140353?lang=en) in Myanmar, a planned 6-month trip to Africa this year, eating 1 meal a day, walking 5 miles to work each day. Objectively cool, but investors are concerned.
- __He's got a (huge) 2nd hustle...__ Dorsey's also the CEO/co-founder of __[Square](https://robinhood.com/stocks/SQ)__, the digital payments company valued at $35B (more than Twitter's $27B). This double CEO-ship of 2 big public companies is unusual. Elliott wants a CEO for Twitter focused on Twitter.

__Annnd, Jack might have a favorite child...__ Dorsey owns $531M worth of Twitter stock, but a re-tweetable $4.9B of Square stock. Twitter's stock is barely higher now than it was in 2013 when it IPO'd — meanwhile, Square is [thriving](https://snacks.robinhood.com/newsletters/3jDG5QbIg9uvXFGx9pgzQr/articles/6Cud3kG8KcnM76d9MhBgWh/). 



_A hedge fund trying to understand Jack Dorsey_

Tweet

__The multi-tasking eccentric CEO thing only flies in certain scenarios...__ Here are the 2:

1. If the __company is thriving__ or its stock is up (like with Musk's Tesla), investors may tolerate extracurriculars. But Twitter's earnings growth and share price have lagged.
2. When a founder is __given super-voting stock__ (like Facebook's Zuck) his/her power is protected against investor pressure. Jack Dorsey has neither — and could get sacked from the company he founded.


Twitter's CEO Jack Dorsey gets "ultimatum'd" by a hedge fund — might lose CEO-ship

__The limit does not exist...__  __Panera__ is launching an $8.99/month coffee subscription for members of its (creatively-named) rewards program, MyPanera — which reportedly has [38M members](https://www.businessinsider.com/panera-unlimited-coffee-subscription-cost-how-to-sign-up-2020-2). Starting Thursday, you'll be able to endlessly fill your cup with hot (or iced) Panera coffee and tea. Panera's CEO said it's the 1st brand to do it, but Burger King launched a [similar](https://www.forbes.com/sites/shephyken/2019/04/14/burger-king-serves-up-subscription-coffee/#52fa09ec7068) $5/month subscription last year. Here's the idea:

- __$1,100:__ Americans' average yearly coffee spend, according to Acorns (probably double for nitro cold brew fiends) — Panera's subscription costs $108/year.
- __$2.20:__ The price of a Panera [coffee](https://www.businessinsider.com/panera-unlimited-coffee-subscription-cost-how-to-sign-up-2020-2) — if you have 5 or more per month, the subscription saves you $$$.

__Too good to be brew?...__ Exactly what Panera wants you to think. It's betting that you'll be a better customer if you're a subscriber:

- __Frequency:__ Subscribers' monthly visits increased from 4 to over 10 in markets where the program was tested, [according to](https://www.cnbc.com/2020/02/26/panera-bread-to-offer-coffee-subscription-program.html) Panera's CEO. Plus, 90% of subscribers renewed their subscriptions. 
- __New Business:__ Almost 25% of subscribers were new members to the loyalty program. 
- __Food Sales:__ Panera thinks you'll stop in for the unlimited coffee, then probably grab a bagel, croissant, or huge kale salad on your way out. 

Caffeinate

__A powerful combo of loyalty + cross-selling...__ Owning habits means owning wallets. Panera is offering an attractively priced subscription to lure you (and your coffee ritual) into its ecosystem. The more coffee you have, the more money you'll feel like you're saving with that subscription — and the rewards-driven cycle repeats. Once there, you'll probably get more than a drink (aka extra sales for Panera that wouldn't have happened otherwise). 



Panera wants to be the Netflix of coffee — launches $9/month caffeine subscription 

__Early bird gets the QR code...__ Electric scooter company __Bird__ is trying its wing at payments with a new service called [Bird Pay](https://techcrunch.com/2020/02/25/bird-is-testing-bird-pay-which-lets-users-purchase-items-from-local-businesses-using-its-main-app/). How Bird envisions it: you open the app to unlock a scooter, whizz down the street to a sandwich shop, then pay for your hoagie via a QR code in the app. The angle for customers:

- __Novelty:__ Pretty much none. __Apple__, __Google__, __Venmo__, __Samsung__ and even __Uber__ offer mobile payment products (with wider offerings).
- __Convenience:__ Some (maybe). Saves you a couple seconds if you already have the Bird app open — plus, it's only being offered at certain stores.

__Getting locals on the Bird wave...__ Bird — last valued at $2.5B — is  live in 100 cities. Now it's looking to partner with local businesses in scooter-heavy areas through its new payment feature. The B2B sales pitch: 

- [According](https://www.bird.co/press/bird-pilots-bird-pay-in-los-angeles/) to Bird, __58% of all Bird rides__ start or end at a local business, so...
- Businesses can __increase sales__ by getting promoted in the Bird app (riders scooting nearby see a $3 hazelnut cold brew around the corner)
- __In sum:__ "Birds outside bring business inside," according to CEO Travis VanderZanden (not a Marvel villain) 




__Bird has a community problem...__ And Bird Pay is an elaborate attempt to fix that. Bird is extending an olive branch to business owners, who've been frustrated with metal scooters littering storefronts. It's [offering](https://www.bird.co/pay/) to put businesses "on the map" and connect them with "thousands of potential customers" nearby. If Bird is able to get local business on its side, it'll be better equipped to fend off [resistance](https://www.cnn.com/travel/article/electric-scooter-bans-world/index.html) and regulation from local governments.  

Bird wants to be more than just your scooter — it wants to be your wallet (kind of)

Dow Jones

S&P 500

Nasdaq

Bitcoin

10-Yr US Treasury

📲 Twitter's CEO gets ultimatum'd

__Taking Wall Street's temperature...__ The [S&P 500](https://learn.robinhood.com/articles/7kFFEUv46vmMCmMfLuNiRX/what-is-the-s-and-p-500/) boils down the stock prices of the 500 "most valuable" publicly traded companies on American exchanges into a single number. That number helps us quickly answer the question: “How is the US stock market doing?” Here's how the S&P 500's "temperature" changed from February 19th to February 28th (last Friday): 

- __Feb 19th:__ 3,386 points.
- __Feb 28th:__  2,954 points.
- That's a __13% drop__ in just __7 days__ of trading.

__This isn't the same as '08...__ Back then, a financial crisis was caused by deep *internal* problems with our economy (a housing market bubble and massive debt). The threat this time is *external*: COVID-19 (aka coronavirus) had already shut down big chunks of the Chinese economy — but last week, the economic disruption spread to Italy, South Korea, and Iran.

- __There's no cure/vaccine yet:__ But the Fed's chairman Jerome Powell said Friday that he stands ready to [dish out](https://www.nytimes.com/2020/02/28/business/economy/federal-reserve-says-ready-to-act.html) monetary medicine via the central bank's bazooka of cash.
- __It's a correction, not a bear market:__ Since 1946, market corrections with declines of between 10% to 20% have happened 29 times (once every 2.5 years on average) according to [Guggenheim Funds](https://www.guggenheiminvestments.com/mutual-funds/resources/crucial-conversations/putting-pullbacks-in-perspective). A [bear market](https://learn.robinhood.com/articles/3i6hIwhY75uWjZUZiLFTFT/what-are-bull-and-bear-markets/) means a fall of over 20% — hasn't happened (yet).
- __The bull market is still bucking:__ The S&P 500 has more than quadrupled since hitting a bottom in March 2009 — in 11 years, it hasn't dipped more than 20%. That's the longest [bull market](https://learn.robinhood.com/articles/3i6hIwhY75uWjZUZiLFTFT/what-are-bull-and-bear-markets/) tracked to date. 

"_Is the market back up, yet?_"

Drop

__Uncertainty is the market's illness...__ This public health outbreak could be a major hit to the economy, or it could be a blip on the freakout radar. Instead of gambling on those two outcomes, many investors have sold out of risky assets (stocks). The 10-Yr Treasury yield fell to a [record low](https://www.cnbc.com/2020/02/25/what-happened-to-the-stock-market-on-tuesday-stocks-plunge-again.html) rate, meaning investors are piling into relatively safer government bonds because of uncertainty.

- __Worst case:__ To crush a domestic epidemic, the government could mandate that cities, states, or the whole country stay at home for 30 days, which would contract our economy, shrink profits, and hurt stocks. 
- __Best case:__ The disease could remain contained (aka no epidemic at all in the USA), and there's no major disruption to our economy. America's collective stress can return to its normal, elevated state. 


Markets had their worst week since the financial crisis — blame viral uncertainty

__FOMO never felt so good...__ While coronavirus fears spread and WFH becomes the norm for many, stay-at-home stocks are cruising care-free. As stock prices were downgraded en masse last week, "no-contact" stocks actually *rose*: __[Peloton](https://robinhood.com/stocks/PTON)__ (up 9%) — work out without visiting a germy gym. __[Zoom](https://robinhood.com/stocks/ZM)__ (up 8%) — video conference your biz meetings instead of in-person. __[Netflix](https://robinhood.com/stocks/NFLX)__ (up 3%) — entertain yourself without leaving the house. 

__What retail-apocalypse?...__ __[TJX](https://robinhood.com/stocks/TJX)__, the discount retail giant behind TJ Maxx, Marshalls, and Homegoods, reported a 6% quarterly sales [surge](https://snacks.robinhood.com/newsletters/1FKKdbQjIpHVV86ywmUIjB/articles/6YscPrg1Mp9jGaNkCngApy) (and a fashionable $985M in profit). Meanwhile, __[JCPenney](https://robinhood.com/stocks/JCP)__ hasn't posted growth since 2017, and __[Macy's](https://robinhood.com/stocks/M)__ sales fell 0.5% last quarter. While brick-and-mortar stores shutter, TJX's trio of *treat-yo-self-without-going-broke* stores are embracing the "affordable splurge" that low- and middle-income Americans are craving.




Highs

Who's up...

__Losing "share of throat"...__ __[AB InBev](https://robinhood.com/stocks/BUD)__ — Earth's largest brewer. Its profits *plummeted 75%* last quarter. And its top labels are [losing ground](https://snacks.robinhood.com/newsletters/3jDG5QbIg9uvXFGx9pgzQr/articles/7vMKqMXV2q6kLPBjSDIwEu/) in its largest market (the US) as Americans snub Bud Lights for White Claws. Seltzers now make up 2.6% of all US alcohol sales — more than 3X growth since a year ago. Bud has intro'd 3 seltzers but is still lagging. The biggest disruptors — __[Boston Beer](https://robinhood.com/stocks/SAM)__'s Truly and __Mark Anthony Brands'__ White Claw — are now too big to acquire. 

__Mosh pit cancelled indefinitely...__ Shares of __[Eventbrite](https://robinhood.com/stocks/EB)__ dropped to an [all-time low](https://www.barrons.com/articles/eventbrite-stock-slides-as-coronavirus-outbreak-mutes-events-outlook-51582913309) despite expectations-beating revenues — that's because it's seeing "early evidence" of virus-related event cancellations. Blame this statement: "We expect the outbreak will impact live events and attendance in the near-term.” Making shareholders even sicker — event rival __[Live Nation](https://robinhood.com/stocks/LYV)__ enjoyed a 10% jump last week, somehow immune so far to coronavirus concerns. 


Lows

...and who's down

🤔 Worst week since '08

__Not a Stella quarter...__ __[AB InBev](https://robinhood.com/stocks/BUD)__ — the owner of beer legends Budweiser, Stella Artois, Becks and Goose Island — announced that its profits [plummeted](https://www.barrons.com/articles/coronavirus-hit-and-hard-seltzer-threat-send-budweiser-brewer-ab-inbev-stock-plunging-51582805172) 75% last quarter to $114M. Shares fell over 9% on the buzz-kill earnings from Earth's largest brewer. Here's the biggest drama:

- Classic Americana Budweiser is now __losing share in its largest market:__ The US.
- And sales of labels __Budweiser and Bud Light have been hit hardest__.

__Shoulda gone harder on seltzer...__ AB's "[share of throat](https://www.ab-inbev.com/content/dam/abinbev/news-media/press-releases/2020/02/AB%20InBev%204Q19%20Results%20Presentation%20FINAL.pdf)" (that's actually what they call it in the beverage biz) has declined significantly as Americans move away from beer to on-trend drinks. Specifically, Bud's admitted that it's getting hit by hard seltzer. 

- __Seltzer market share__ has grown over 3X since a year ago, now making up [2.6%](https://www.wsj.com/articles/budweiser-brewer-takes-profit-hit-loses-more-u-s-market-share-11582793027) of all US alcohol sales.
- __Bud tried to get in on the party__ with  Bon & Viv seltzer (acquired in 2016), Natty Light Seltzer (launched in August), and finally Bud Light Seltzer (launched in January). 
- __But even with Bud Seltzer__ (and its Post Malone-starring Super Bowl ad), AB was too late — it's still lagging competitors. 








"_I thought I told you to buy White Claw, Mark_"

__Bud can't acquire its way out of this one...__ The last time Big Beer was under threat it was from craft beer. Beer giants (including AB-InBev) acquired a bunch of IPA/craft ales to protect themselves. This time, the threat is hard seltzer, but the disruptors are already too big to buy. __[Boston Beer Co](https://robinhood.com/stocks/SAM)__'s __Truly__ and Mark Anthony Brands's __White Claw__ *dominate* the market (about 85% of hard seltzer). AB will have to leverage its 3 existing seltzers instead.




Budweiser can't just blame coronavirus for its lager-pocalypse (blame Corona, too)

__Be there or be Square...__ Not too bad. __[Square](https://robinhood.com/stocks/SQ)__ stock [jumped](https://www.barrons.com/articles/square-stock-is-up-strongly-thanks-to-strong-earnings-51582823026) 4% yesterday on strong quarterly earnings, which included a [46%](https://s21.q4cdn.com/114365585/files/doc_financials/2019/q4/2019-Q4-Shareholder-Letter-Square.pdf) jump in sales to $1.3B. Square is Jack Dorsey's mobile payments processing company that makes money in 3 key ways (same Jack as the one running Twitter).

- __Seller Ecosystem:__ You've probably seen Square's sleek tablets at craft coffee shops, or swiped your card through a little white reader plugged into an iPhone at a taco truck. Sellers can easily process transactions, and Square gets a cut of each swipe.
- __Square Capital:__ Offers loans to Square's sellers and small businesses, then collects interest and fees. 
- __Cash App:__ Offers peer-to-peer money transfers (like __[Paypal](https://robinhood.com/stocks/PYPL)__'s Venmo), and collects fees on credit card transactions. It also offers a debit card and launched stock trading in October. 

__When the underdog comes in clutch...__ While small business card processing is Square's primary biz, its consumer-facing Cash App has been a star in its earnings:

- __Cash App__'s revenue increased 147% from last year to $361M in the 4th quarter.
- __Monthly users__ doubled from 7M to 15M in 2018, and hit 24M in 2019.
- __For reference:__ In April 2019, Venmo reported having 40M *yearly* users.





__Square's got the "monetize users" thing down...__ Paypal/Venmo doesn't. And Square's monetizing both its sellers (businesses) and buyers (consumers). It attracts sellers onto its easy payments tech, then hooks them in with other services like loans and payroll. On the Cash App side, it promotes consumer engagement by offering promotions through the Boost program. And the more you spend on its card/app, the more Square gets paid. 

Square stock pops 4% as its underdog Cash App nears "profit puppy" status

__Was expecting something meatier...__ __[Beyond Meat](https://robinhood.com/stocks/BYND)__'s sales tripled for the quarter as it sprints around food shows trying to lock up deals with fast food chains. But investors were disappointed by its losses: the previous quarter, Beyond was profitable — this past quarter, not so much. So the stock got quarter-pounded, falling over [10%](https://www.cnbc.com/2020/02/27/beyond-meat-bynd-earnings-q4-2019.html) on the news. 

- __Beyond's quarterly loss__ was $452K. Not bad, considering last year's same-quarter loss was $7.5M. 
- __Buuuut...__ investors were looking for a repeat of last quarter's profitability — once you go profitable, unprofitability looks even uglier. 

__Alt-meat life be like a rollercoaster...__ Beyond has had some stock trauma since its IPO in May. It nearly *quadrupled* after going public — then it dropped by half. Still, the IPO was a big, meaty marketing win: *Awareness of the Beyond Meat brand has nearly [tripled](https://investors.beyondmeat.com/static-files/bc7f47c4-df1c-4461-8f0c-7a4df5c42eda) since its IPO*. There was also a crazy week of alt-meat packed news leading up to Beyond's recent earnings:

- __Starbucks__ [launched](https://www.delish.com/food-news/a31119976/starbucks-beyond-meat-breakfast-sandwich/) Beyond breakfast sandwiches in Canada
- __Cargill__ [announced](https://www.foxbusiness.com/lifestyle/cargill-is-competing-in-plant-based-meat-market) it's making its own plant-based meat
- __Disney__ [made](https://www.cnn.com/2020/02/25/business/disney-impossible-partnership/index.html) Beyond's rival Impossible its official theme park alt-meat

Bite

__Is Beyond the LaCroix of plant-based meat?...__ When the barriers to entry are low, competition comes easy: LaCroix was the first mover to start the flavored sparkling water frenzy, but it was soon inundated by a carbonated wave of rivals (Pepsi, Coke, Spindrift, et al). Similarly, Beyond Meat pioneered alt-meat meat life. Now, competition is everywhere (Impossible, Kellogg, Tyson, etc.) — and that's slowing Beyond's plant-based growth. 

Beyond Meat's sales tripled, but it (and its stock) still lost

🍺 Bud's buzz-kill sales

__Coming in hot off the rack...__ Discount retail giant __[TJX](https://robinhood.com/stocks/TJX)__ is the company behind TJ Maxx, Marshalls, and Homegoods (the "treat-yo-self-without-going-broke" trifecta). It reported [expectations-shattering](https://www.investors.com/research/ibd-stock-of-the-day/tjx-earnings-q4-2019-tjx-stock/) sales growth, sending its stock up 7% to a record high. We'll discount the details for you:

- __TJX:__ Quarterly same-store sales popped 6% from last year with $985M in profit. TJX has opened ~1,100 stores over the past 5 years and its [market value](https://learn.robinhood.com/articles/GByCbiOluG2kcWs1AF6m5/what-is-market-capitalization/) is a whopping (and surprising) $77B (that's 7 Lyfts) — for reference, __[Macy's](https://robinhood.com/stocks/M)__ is $4B. On that note...
- __Retail peers didn't fare as well:__ __[Burlington's](https://robinhood.com/stocks/BURL)__ sales (you know, the Coat Factory) grew a measly 0.6% last quarter while Macy's dipped 0.5%. Meanwhile, __[JCPenney](https://robinhood.com/stocks/JCP)__ hasn't posted a gain [since 2017](https://finance.yahoo.com/news/struggling-jcpenney-sees-chief-customer-155646443.html), and last month announced it was closing 6 more stores. Oh, and JCP's stock costs less than $1.


__It's beating the retail-apocalypse...__ With brick-and-mortar retail stores closing all over, TJX stands apart from the rest. Part of its success is in creating the "[treasure hunt shopping experience](https://www.forbes.com/sites/andriacheng/2020/02/26/the-biggest-threat-facing-department-stores-and-many-other-retailers-isnt-amazon/#4107a4c37831)" — nothing beats finding a $40 Michael Kors purse in a heap of sweaters.




_When you hit TJ Maxx, Marshalls, and Home Goods all in the same day_

Shop

__TJX is all about embracing the "affordable splurge"...__ The bargain-reputation is TJX's bread and butter — it's not trying to hide its love of price-slashing. TJX's [CEO](https://www.investors.com/research/ibd-stock-of-the-day/tjx-earnings-q4-2019-tjx-stock/): "What once, maybe, wasn't as cool to give a T.J. Maxx or Marshalls bag has now become very cool." Okay, *very cool* might be an overstatement, but... you get it. As [economic inequality](https://www.pewresearch.org/fact-tank/2020/02/07/6-facts-about-economic-inequality-in-the-u-s/) rises, Americans are turning to TJX for brand names, at a discount.

TJ Maxx crushes sales by offering America "affordable splurge" vibes

__If you want it, let's do it...__ __Pony.ai__ is a self-driving car startup that [claims](https://time.com/5602852/pony-ai-james-peng-autonomous-vehicle-startup/) to be based in both Silicon Valley and Guangzhou, China — and it just got a [$400M investment](https://www.theverge.com/2020/2/25/21152817/toyota-pony-ai-self-driving-car-investment-valuation-china-silicon-valley) from the world's largest car maker,  __[Toyota](https://robinhood.com/stocks/TM)__. Now Pony's riding high at a $3B valuation. Pony has been testing the robotaxi life since 2018, and is now one of China's [leading self-driving](https://www.economist.com/business/2019/10/12/chinese-firms-are-taking-a-different-route-to-driverless-cars) car companies (along with __Baidu__ and __WeRide__). Pony and Toyota's AI love story:

- __Pony has been testing__ robotaxis since 2018 and first partnered with Toyota in 2019.
- __$400M later,__ Pony's relationship with Toyota is closer than ever — they're going to be co-developing their autonomous tech.

__Toyota has been kinda secretive...__ about its self-driving car projects — but its investment in Pony suggests things are getting serious. FYI, it's not an exclusive relationship: in 2018 and 2019, Toyota [poured](https://techcrunch.com/2019/04/18/uber-atg-1-billion-toyota-denso-vision-fund-spin-out/) around $1B into a similar project with __[Uber](https://robinhood.com/stocks/UBER)__. Toyota's status quo is Priuses, Corollas, and Camrys — so it *needs* other companies' AI tech to future-proof its vehicles. Because...



Ride

__Getting ahead of the curve is key...__ Self-driving cars could be the future, and no company wants to miss out on the future — especially the world's most *profitable* car company. Instead of wasting time trying to develop its own robocar tech, Toyota (and several other carmakers) are investing big in *existing* startups:

- __Ford:__ Invested $1B in self-driving tech startup __Argo AI__ and acquired mobile robotics company __Quantum Signal__.
- __GM:__ Purchased __Cruise Automation__ for [over $1B](https://fortune.com/2016/03/11/gm-buying-self-driving-tech-startup-for-more-than-1-billion/) back in 2016, and it's reportedly worth over $[19B](https://news.crunchbase.com/news/cruise-drives-away-with-1-15b-in-funding-at-19b-valuation/) now, with Honda and Softbank as co-investors.


Pony gets $400M from Toyota to develop self-driving cars

🛍 TJ Max beats retail-apocalyse 

__Literally "grab-and-go"...__ __[Amazon](https://robinhood.com/stocks/AMZN)__ [opened](https://www.cnbc.com/2020/02/24/amazon-opens-its-first-full-size-cashierless-grocery-store-in-seattle.html) a checkout-free grocery in Seattle Tuesday, its biggest "Go" store yet. As you cruise the aisles and squeeze-test avocados, shelf-sensors and cameras stalk your every move (no more "sampling" the nuts section). You grab your favorite rosé, walk out, and see the $10 charge on your Amazon app:

- __Go Big:__ Amazon has opened 25 Go stores over the past 2 years — but this supermarket is __5x bigger__ than its largest Go store. 
- __Or Go Home:__ Go's VP said this improved tech can be deployed on an even *larger* scale — "There's no real upper bound."
- __But:__ Sales at the first batch of Go stores actually declined in 2019 from the year before.

__Go's true ambitions lie beyond grocery...__ Amazon is using this huge Go store as a showcase for its customer-stalking, product-tracking *tech*, which it will likely start [selling](https://www.fastcompany.com/90467932/amazon-go-expanding-to-larger-seattle-store-licensing-tech-to-retailers) to other businesses. It's reportedly talked already with potential partners like airport convenience stores (snatch that Kind Bar while sprinting to Gate E14) and sports arenas (grab the Cracker Jack without missing an at bat).

- "__Go as a Service__"__:__ Amazon might offer *GaaS* (not actually called that) to retail companies that want Amazon's tech in their own stores.  
- __Question is:__ Will Amazon's retail competitors be down to partner with their #1 rival? __[Walmart](https://robinhood.com/stocks/WMT)__ almost certainly [won't](https://www.engadget.com/2018/06/14/microsoft-cashierless-walmart/). 

"_Amazon Go cannot identify this shopper: Please scan your app for assistance_"

__Amazon's real money lies in its tech and services infrastructure...__ Besides acquisitions like __Ring__ and products like Alexa or Amazon Basics, Amazon doesn't really sell *its own* physical goods. The company is most known for its ecommerce platform, where other companies sell *their* stuff. It actually made 63% of its profit from its Amazon Web Services cloud — that's twice as much as its core ecommerce biz. Now it's positioning Go as a 2nd potential software profit puppy.

Amazon opens a cashier-less supermarket — but it's more interested in the tech than the groceries

__Employee of the decade...__ __[Disney](https://robinhood.com/stocks/DIS)__ legend Bob Iger surprised the world Tuesday by [stepping down](https://variety.com/2020/biz/news/bob-chapek-bob-iger-disney-ceo-succeed-1203515498/) as CEO (he was expected to retire at the end of 2021). Over 14 years, Iger grew Disney into Hollywood's largest, most powerful media conglomerate. He'll continue through 2021 as Creative Chief and Chairman, but Let's take a magical journey back in time:

- __2005:__ Bob becomes CEO. Disney owns 21 TV channels — and 55% of its profits come from cable TV (mostly ESPN). 
- __2006-2007:__ In 2006, Disney buys Pixar. A year later, Netflix launches streaming, threatening Disney's cable biz.
- __2009-2019:__ Disney acquires Marvel in 2009, scoops up Star Wars (aka LucasFilm) in 2012, and snags 21st Century Fox in 2019 for $71B (Bobby's biggest deal) to beef up his content arsenal. 
- __Today:__ Disney is thriving thanks to Iger's media acquisitions (it posted a record $69.5B revenue last year) and the stock is 5X more valuable than when Big Bob took charge in '05. 

__Disney makes bank...__ off its media/movie franchises, its character-driven theme parks, and its franchised merch (Baby Yoda FTW) — it's all part of its product ecosystem. As CEO, Iger had become one of the most powerful people in:

- __Hollywood:__ Between Marvel, Fox, and Star Wars, Disney is the king of blockbusters. 
- __Streaming:__ Disney+ already has over [28M subscribers](https://techcrunch.com/2020/02/04/disney-plus-subscribers/) since its November launch. 
- __Sports:__ Disney owns ESPN and ABC — leaders in sports programming.
- __Toys:__ Baby Yoda. 'Nuff said.

Dream

__TBD on the new guy...__ He's another guy named Bob: Disney's head of parks/resorts, [Bob Chapek](https://variety.com/2020/tv/news/who-is-bob-chapek-ceo-walt-disney-1203515791/). He's been at Disney for 27 years, and was at Heinz Ketchup before. But Disney's future is cutting-edge media, so the theme parks + condiment resumé is a tad surprising. But Chapek has headed key Disney units, and beat out potential successors (including Disney's streaming exec). He's got big Mickey shoes to fill.

Disney's visionary CEO Bob Iger steps down after 14 magical years

__That feeling when you're stuck in a Shack line...__ We got it from __[Shake Shack](https://robinhood.com/stocks/SHAK)__'s earnings — a 3.6% fall in same-store sales (adorably called "Same-Shack Sales") and foot traffic [slipped](https://markets.businessinsider.com/news/stocks/shake-shack-stock-price-falls-earnings-4q-revenue-forecast-miss-2020-2-1028933210), too. Some of the pickles that soured Shack's burger and dropped the stock 14%:

- __"Significant slowdown"__ in the growth of its delivery biz — Shack decided to go [exclusive](https://www.investors.com/news/shake-shack-earnings-q419-shake-shack-stock-delivery/) with __GrubHub__, uprooting itself from DoorDash, Postmates, etc. The "moving out" process cost it deliveries. 
- __"Less menu innovation":__ Fad foods drive sales. Think __Chipotle's__ carne asada, __McDonald's__ Beyond Meat PLT, and __Popeye's__ Chicken Sandwich (which literally caused a chicken shortage/fights). The Shack has lacked in the "dope foods" category.

__Shake Shack is like a fast-growing teen (in a slump)...__ Most of the 15-year-old chain's 275 Shacks are just in the adolescent phase — 60% are less than 3 years old (teens, in millennial biz years). And Shack's been aggressively expanding into malls, airports, and "free standing pads." But the core problem is lack of innovation...

__Shake Shack needs to shake up its menu...__ Last year's Chick'n Bites weren't a game changer. Even Shake Shack's CEO said "*We chose to limit our menu innovation in comparison to prior years.*" But buzzy new food items are *key* to driving store traffic. So are buzzy new features, like __McDonald's__ $1B worth of ordering kiosks, __Domino's__ constantly-improving delivery app, and __Sweetgreen's__ office food lockers. 

Shake Shack sales fall because it's struggling through a "teen slump"

🥑 Amazon's GaaS play  

__You can do it, put your back Intuit...__ __[Intuit](https://robinhood.com/stocks/INTU)__ confirmed it's buying privately-held __Credit Karma__ for $7.1B, its largest acquisition ever. Intuit's splurging on CK because it wants more of your financial data — that's crucial to how it makes $$$. FYI, Intuit [spends](https://www.propublica.org/article/filing-taxes-could-be-free-simple-hr-block-intuit-lobbying-against-it) millions of bucks trying to keep the tax system complex because it owns a whole lot of tax software:

- __TurboTax:__ Intuit charges for certain tax situations when you use its filing service (and allegedly — along with H&R Block — [hid](https://www.propublica.org/article/turbotax-deliberately-hides-its-free-file-page-from-search-engines) its free filing page from showing up on Google). 
- __QuickBooks:__ Intuit's popular small biz accounting software makes money off monthly subscription fees.
- __Mint:__ Intuit acquired the budget tracking tool in 2009 for $170M. Mint is free, but makes money off ads and product referrals (like an Amex cash back card that's perrrfect for the Chipotle over-spending habit Mint knows that you have). 

__We're calling it the "Data Double Dip"...__ Claaassic Triple D scenario, but with a Premium topping. TurboTax and QuickBooks make Intuit $$$ on premium services, while "free" services like Mint and CK earn by double-dipping into users' financial data: 

- __Targeted Ads:__ CK knows your credit/debt info, and Mint knows your spending habits — they can charge advertisers for *highly targeted* ads based on your financial situation. 
- __Referral Commissions:__ If you click on one of the Capital One card ads CK or Mint show you, they could get a finders fee (aka referral commission) if you sign up. 


_2 scoops of Data Double Dip, with a generous Premium topping_

Data

__Intuit wants to be the [Facebook](https://www.nytimes.com/2020/02/23/business/dealbook/credit-karma-intuit-deal.html) of personal finance...__ Its CEO [thinks](https://www.benzinga.com/news/earnings/20/02/15398374/intuit-reports-q2-earnings-beat-acquires-credit-karma-for-7-1b) the Credit Karma acquisition will "create a personalized financial assistant to help consumers find the right financial products..." Key words: *personalized* and *products*.

- Intuit can offer a free service, get your  financial data, and find ways to __turn that intel on your wallet__ into revenue by selling targeted ads and partner products.
- Facebook does the same with __social intel you reveal on Instagram__.

Intuit acquires Credit Karma for $7.1B so it can become the Facebook of finance

__An everyone problem...__ Coronavirus. The World Health Organization hasn't declared it a global pandemic yet — that would mean uncontained global spread and large scale deaths. But 2 more countries are scrambling to control the infectious disease:

- __South Korea:__ [231 new cases](https://time.com/5789596/south-korea-coronavirus-outbreak/) on Monday, bringing the total to 833. The highest level of national alert was issued there.
- __Italy:__ Now the [largest](https://www.cnn.com/2020/02/23/europe/italy-novel-coronavirus-spike-intl/index.html) coronavirus outbreak outside of Asia — cases surged from 3 on Friday to over 219 on Monday. Over 50K people in 11 northern Italian towns are under [quarantine](https://www.telegraph.co.uk/news/2020/02/24/nightmare-inside-italys-coronavirus-quarantine-zone/). 

__Think of each country as a huge factory...__ a huge shopping mall, and a huge tour group. China's 3 economic "personas" have all been shuttered because of coronavirus. And that's affecting the whole world:

- __China, The Factory:__ Companies like __Apple__, __Nike__, and __Honda__ shut down Chinese factories and/or slow production. [94%](https://fortune.com/2020/02/21/fortune-1000-coronavirus-china-supply-chain-impact/) of the Fortune 1000 companies are seeing coronavirus supply chain disruptions. 
- __China, The Mall:__  People in China are staying home to avoid catching/spreading the disease — that hurts Chinese consumer spending (__Apple__, __McDonald's__ and __Starbucks__ shuttered stores).
- __China, The Tourist:__ China has over 1.4B people and an outsize impact on global tourism. Travel restrictions have hit the airline, hotel, and luxury retail industries outside China especially hard. 

Spread

__The economy has reason to worry, but not to freak out....__ Over 2.5K coronavirus deaths have been reported so far in China, and at least 33 in other countries. The WHO [thinks](https://www.npr.org/sections/goatsandsoda/2020/02/24/808893094/coronavirus-has-pandemic-potential-but-isn-t-there-yet-who-says) it has "pandemic potential." And it's taking a real toll on global markets.

- But long-term investors shouldn't panic, [according to](https://www.forbes.com/sites/sergeiklebnikov/2020/02/24/heres-what-warren-buffett-says-about-the-coronavirus-and-his-outlook-on-stocks/#32b35ebb182c) "buy low, sell high" guru Warren Buffett: __"We think the 20 and 30-year outlook is not changed by the coronavirus.”__
- TBD how investors will continue to __react in the short-term__. 



Coronavirus is a factory/mall/tourist triple whammy — and it just entered 2 more countries

💰 Intuit's $7B Credit Karma splurge 

__This is a smog-free zone...__ Upstate New York's __[Plug Power](https://robinhood.com/stocks/PLUG)__ wants to be the "leader in powering electric motors" — but it's 23-years-old and definitely isn't that. It's taking a different approach than Tesla to clean electric motors: The Hydrogen Fuel Cell. Now it's getting major attention from investors in its 24th year.

- __Battery electric:__ Drives ~250 miles on a charge. Great for most car owners, because 99% of drives are shorter than that. Charge the car overnight with your garage outlet.
- __*Fuel cell* electric:__ For industrial vehicles (think forklifts, buses, delivery trucks), battery doesn't work as well because charging takes hours. And hours of not moving is big lost $$$. Fuel cell is as green as battery, but takes minutes to *fill up* instead of hours to *charge up*. 
- *__For the chemistry fans (how Fuel Cell works):__* Hydrogen and Oxygen [enter](https://www.plugpower.com/about-us/fuel-cell-benefits/) a fuel cell engine, then electricity, heat, and water go out. 

__But you've still never heard of Plug Power...__ Until this year. In January, the company announced a major [order](https://www.ir.plugpower.com/Press-Releases/Press-Release-Details/2020/Plug-Power-Receives-172M-Order-for-Hydrogen-and-Fuel-Cell-Solutions-From-Fortune-100-Customer/default.aspx) from one Fortune 100 company — the single order will generate nearly as much revenue ($172M) as Plug Power made in the entire past year ($191M). It also announced a [new engine](https://www.ir.plugpower.com/Press-Releases/Press-Release-Details/2020/Plug-Power-Partners-with-Lightning-Systems-to-Build-Zero-Emission-Middle-Mile-Delivery-Solution/default.aspx) it's working on specially for delivery trucks. But __its stock has risen over 150% in 5 months__ and 27% just last week... despite 2 decades of consistent unprofitability.

_When a stock hits "cult" speed_

Moon

__We have to talk about "cult stocks"...__ 3 stocks this year have enjoyed gigantic stock price jumps that can't really be explained by fundamentals or company news. __[Tesla](https://robinhood.com/stocks/TSLA)__ and __[Virgin Galactic](https://robinhood.com/stocks/SPCE)__ both hit the upper stratosphere of Wall Street recently, and elements of their inexplicable rise can be seen in Plug Power (although valued at under $2B, Plug Power is much smaller). We noticed a cult stock formula:

- Each features a combo of __charismatic leader__, __revolutionary product__, and __tons of attention on Reddit__.
- [CNBC](https://www.cnbc.com/2020/02/19/add-surging-plug-power-to-the-list-of-stocks-seeing-big-speculative-trading-right-now.html) credits Plug Power's rise to campaigns on Reddit, while the [Financial Times](https://ftalphaville.ft.com/2020/02/20/1582193215000/Reddit--bull-attack/) cites "coordinated buying."
- In the long run, fundamental profitability is the key driver of a stock price, so cult stocks can be vulnerable to fall if their buzzy status passes. 


Plug Power looks like the latest "cult stock" to want to join Tesla and Virgin Galactic

__Put your back Intuit....__ The creator of TurboTax and QuickBooks is adding to its clique of popular financial products, just in time for tax season. __[Intuit](https://robinhood.com/stocks/INTU)__ is close to striking a [deal](https://www.wsj.com/articles/intuit-near-deal-to-buy-credit-karma-for-7-billion-11582433880?mod=hp_lead_pos1) to buy privately held __Credit Karma__ for $7B — its largest acquisition ever. In 2009, Intuit acquired budget tracker Mint for $170M. Now Intuit's splurging more because it wants to be aggressively involved in your daily finances (not just your yearly tax frenzy). 

__Tastes better when you DIY...__ __[Domino's](https://robinhood.com/stocks/DPZ)__ global sales jumped 8%, sending shares up 30% last week. It's one of the only big chains that refuses to partner with delivery apps like __Gruhub__ and __DoorDash__. For years, it's taken a [DIY approach](https://snacks.robinhood.com/newsletters/4dQzmfcL6V8Dtknj3cmAs4/articles/7t7MNxjGP1Bmx1DtzDt9BN) to delivery, investing big in its own app — now it's expanding GPS-pizza tracking for hangry orderers. FYI, takeout now makes up *nearly half* of Domino's orders — and it's more profitable than delivery (because delivery costs extra time & money). 



__Don't hate the player...__ hate the benchmark. Shares of Warren Buffett's legendary holding company __[Berkshire Hathaway](https://robinhood.com/stocks/BRK.B)__ rose 11% in 2019 — not bad, right? Until you compare that with the [S&P 500](https://learn.robinhood.com/articles/7kFFEUv46vmMCmMfLuNiRX/what-is-the-s-and-p-500/), which jumped 31.5% last year. That means that if you'd invested in an S&P 500-tracking [ETF](https://learn.robinhood.com/articles/QkpPOCYYd2fMe76837dvG/what-is-an-exchange-traded-fund/) for all of 2019, you would've made a 31.5% return (that's almost triple the return of Buffett's baby). But Warren reminded us as always in his annual [letter](https://www.berkshirehathaway.com/letters/2019ltr.pdf) to shareholders (which came out Saturday) that Berkshire has performed twice as well as the S&P 500 historically since 1965.

__Secret goes private...__ __Victoria's Secret__ was sold off by struggling parent __[L Brands](https://robinhood.com/stocks/LB)__. And get this: the lingerie chain is only worth $1.1B as a private company. Vicky hasn't adapted well to an era of inclusivity and bralettes — slowing sales and [bad PR](https://www.nbcnews.com/news/us-news/former-jeffrey-epstein-pal-leslie-wexner-steps-down-ceo-victoria-n1139916) dropped L Brands' value by 75% over 5 years. With the sale of VS (and its PINK brand), all L has left is a healthy-ish __Bath & Body Works__ brand. Scented shower gel may help clean the financial woes. 


💫 Plug Power hits "cult speed"

__Anything you can do, I can do better (alone)...__ __[Domino's](https://robinhood.com/stocks/DPZ)__ just delivered a hot box of tasty earnings — without relying on food-delivery middlemen. The pizza chain [beat](https://finance.yahoo.com/news/dominos-pizza-dpz-beats-q4-134501951.html) both sales and profit expectations in the 4th quarter, sending shares up a steamy 26%. Extra impressive, given Domino's DIY attitude:

- __Delivery app middlemen__ like __DoorDash__ and __Grubhub__ promise to boost restaurants' sales, but they take a cut of that money. 
- __Restaurants don't want to splurge__ on their own delivery app/drivers, so they'll partner with  apps for tech + exposure despite the fees. __Shake Shack__, __Starbucks__, and __Wendy's__ are all [listed](https://delivery.starbucks.com/) on partner apps. 
- __Domino's is 1 of the only__ big chains that refuses to work with outside delivery apps — it thinks commissions are lame and wants to have control over its customer service (and guard against cold pizza).

__Domino's is one of the OGs...__ that popularized delivery — it was always DIY. But now with increased competition from the apps, it's rolling up its sleeves to beef up its delivery/carryout game: 

- __Online:__ Introduced online-ordering for carryout, and an app that shows real-time GPS order tracking. Its [AnyWare](https://anyware.dominos.com/) platform lets you even order via Alexa, Slack, or Apple Watch.
- __Speed:__ Introduced designated lanes in stores to cut wait times for carryout — it's also building more stores to be closer to pizza lovers and slice delivery times.



_Tastes better when you Do It Yourself_

Grub

__DIY carryout could be Domino's future...__ Efficient carryout operations can hurt delivery middlemen — if there's a Domino's 8 min away from your house, you prob won't be down to pay for delivery/tip on Postmates. Carryout now makes up nearly *half* of Domino's orders, up from about 30% in 2012. And carryout is more profitable than delivery (no drivers to pay). Maybe Domino's will scrap dine-in altogether (have you ever actually sat down in one?). 

Domino's wins with its DIY attitude (and its takeaway-only HOV lanes)

__Sharp left on Wall Street onto Main Street...__ The intersection __[Morgan Stanley](https://robinhood.com/stocks/MS)__ just landed on by buying __[E-Trade](https://robinhood.com/stocks/ETFC)__.  MS is an OG Wall Street bank that has historically done big deals for large institutional clients, corporations, and million/billionaires. But it just dropped $13B for a discount online broker. Why?

- __Main Street push:__ MS wants to manage money for regular people — it thinks gaining retail investors will be a more durable (and less risky) biz model.
- __What E-Trade brings:__ 5M retail customers and their $360B in assets (an average of $72K per customer). MS will also get E-Trade's online banking biz, which is clutch.

__Wall Street thought E-Trade was a goner...__ E-Trade used to make 18% of its revenue from stock trade commissions ($7 on each buy and sell). But after __Robinhood__ introduced commission-free trading in 2013 (disclosure: that's us), brokerages were under pressure to go to $0. In October, Schwab [ended](https://snacks.robinhood.com/newsletters/3nFFPd0MfjBs5AqG8088gu/articles/5YfrqB1klOSuz0H52tu48Z/) its commission fees, and E-Trade kinda had to follow. Its stock plunged 14% that day as a big source of revenue was erased. But MS still sees strength in E-Trade... 

- __So it's paying a huge premium__ to buy E-Trade — 34% more than its October value before its commissions got killed.
- __E-Trade shareholders celebrated__ (its stock rose 22% yesterday). It wasn't so cool for MS shareholders (MS fell 5%).

Acquire

__This deal saves MS loads of *time*...__ and time is money. __[Goldman Sachs](https://robinhood.com/stocks/GS)__ — MS' arch rival — has spent 4 years trying to become a retail bank with its Marcus savings account — and it's still losing money on that unprofitable division. Making a product/market shift takes time for any business. But by acquiring E-Trade, MS just became a retail bank overnight — and it's already profitable on day 1. 

Morgan Stanley snatches up E-Trade to go after sub-millionaires

__It was a public Secret...__ But now it's a *private* Secret (and less of an oxymoron). __Victoria's Secret__ is being sold by its parent __[L Brands](https://robinhood.com/stocks/LB)__ — the lingerie legend and its teen-friendly offshoot Pink will be taken private at a $1.1B valuation. Private equity firm Sycamore Partners gets 55% of VS, while L Brands keeps the rest of its former child. L has been [struggling](https://snacks.robinhood.com/newsletters/6dHf0IKoXordQpWw5SfXlp/articles/7cMpQYST3D9SL5IWBdfVri/) lately...

- __L Brands' [market value](https://learn.robinhood.com/articles/GByCbiOluG2kcWs1AF6m5/what-is-market-capitalization/) has fallen 75%__ in the past 5 years, from $29B to $6.4B.
- The decline's been driven by Victoria's Secret, which __hasn't aged well in the era of inclusivity and bralettes__. The $1.1B value is less than the Gap (which is struggling) - by over 80%.
- That leaves L Brands with just its __Bath & Body Works__ chain (because hygiene is *not* a fad).

__We hear a lot about private companies going public...__ not so much the opposite (except for Elon's [tweets](https://twitter.com/elonmusk/status/1026872652290379776?lang=en)). PE firms usually take out big loans for these buyouts, which they often pass on as debt to companies like VS — this has resulted in quite a few bankruptcies (__Toys R Us__, __Payless__), but also some successes (__SeaWorld__, __Canada Goose__). 

Sell

__VS (badly) needs a makeover...__ The brand has lost touch with customers. If Sycamore Partners is just bargain hunting — like stripping a car for parts — VS could be done for. But this could also be a great opportunity to rebrand, by focusing more on the athleisure-minded Pink line. Plus, new ownership could help distance VS from the controversial Les Wexner, who's stepping down as chairman/CEO.

Victoria's Secret goes private at $1.1B — could go 1 of 2 ways

🍕Domino's DIY Win 

__Low as a kite...__ Google's parent __[Alphabet](https://robinhood.com/stocks/GOOGL)__ is shutting down energy kite startup __Makani__, which wanted to make wind energy cheaper by flying power-harvesting wind turbine kites in the air (tbh, they [look](https://www.theverge.com/2020/2/19/21143540/alphabet-discontinues-makani-flying-wind-turbine-drone-kites-clean-energy) more like small planes). But yesterday, Alphabet announced that it's pulling the plug on one of its most innovative companies. It's an attitude shift:

- __Google's main biz__ is ad sales from its ginormous online platform (Google search, YouTube, Google Maps, etc) — ad sales are [85%](https://www.reuters.com/article/us-alphabet-results/google-parents-shares-dive-as-youtube-changes-competition-hurt-revenue-idUSKCN1S521N) of its revenue. Buuut... Google wants to be more.
- __Enter "X",__ Google's secretive lab of moonshot projects, part of its "Other Bets" division. X is all about making cool stuff: think do-gooder, futuristic projects like self-driving cars (__Waymo__), LTE balloons (__Loon__), and drone delivery (__Wing__). All — including Makani — graduated from X into Alphabet subs. 

__Getting in a gym sesh before 7am...__ Google's moonshot goals are a little more ambitious — and waayy more expensive. CEO Sundar Pichai has [said](https://www.forbes.com/sites/jilliandonfro/2020/02/18/alphabet-shutters-its-energy-kite-company-makani/#7091fbd72b20) Alphabet will increasingly start seeking 3rd-party investors for Other Bets, because:

- __$2.7B & $3.4B__: How much Google lost on "Other Bets" in 2017 and 2018
- __$4.8B:__ "Other Bets" [loss](https://www.ft.com/content/56582032-528e-11ea-8841-482eed0038b1) last year. We're sensing a trend... 

"_So you're saying it won't actually reach the moon?_"

__Other Bets are 'future insurance'...__ Google is big enough to afford moonshots, and in a way, it can't afford *not* to take them: It risks being left in the dust when a huge opportunity hits (#DontMissTheNextiPhone). So far, its 1 big win is Waymo ([valued](https://www.cnbc.com/2019/09/27/waymo-valuation-cut-40percent-by-morgan-stanley-to-105-billion.html) over $100B). But... Makani is the 1st moonshot to shutter since Pichai became Alphabet's CEO in December as the co-founders, who were major champions of the passion projects, retired. We think that signals a shift in openness to fund riskier moonshots.


Google's parent shuts down a "moonshot" — could be the new normal

__An OGPS makes a comeback...__ An original GPS company. We're talking __[Garmin](https://robinhood.com/stocks/grmn)__. The GPS-tech company was founded in 1989 by Gary Burrell and Min Kao (hence, "Gar-Min"). Its stock just hit a 12-year high on an A+ earnings report: quarterly profit nearly doubled, jumping to $361M in Q4. Garmin has a bunch of divisions, but it's lost some of its consumer-appeal over the years. Enter the smartphone...

- __Car GPS:__ Garmin introduced GPS III in 1997 to guide your commute (your dashboard is still bruised from the suction cup) — now you connect apps like Google Maps to CarPlay instead. Garmin's auto revenue declined [14%](https://www8.garmin.com/aboutGarmin/invRelations/reports/2019_Q4_Earnings_Call_Webcast_Slides.pdf) last year and profits are close to zero.
- __Wearables:__ Garmin's Foretrex was the wrist-worn GPS sported by joggers in the early 2000s (1st gen iPod not included). Then Fitbit and Apple took over the wrists of casual joggers. Garmin is still in the wearables game, but [lags](https://www.cnet.com/news/apple-still-tops-growing-global-smartwatch-market/) marathons behind Apple.
- __Handheld GPS:__ Garmin launched the compact eTrex in 2000. Now "handheld GPS" is synonymous with smartphone.

__To beat iPhone...__ go where iPhone won't have service. And Garmin's winning in areas like: Marine GPS (no bars in the ocean), Aviation GPS (does inflight WiFi even work?), and Outdoors (think extreme skiing). Garmin wants to be 35K feet in the air and 30K leagues under the sea — anywhere iPhone can't. 














Track

__Don't underestimate the power of Barriers to Entry...__ The road less traveled is usually toughest, but Garmin uses it to its advantage. Marine/aviation are tougher areas for others to enter than regular consumer markets — that means less competition. GPS guiding a military plane is a bigger technical responsibility than GPS guiding you to Starbucks. With big responsibility comes a fat profit margin — Garmin made [74 cents](https://www8.garmin.com/aboutGarmin/invRelations/reports/2019_Q4_Earnings_Call_Webcast_Slides.pdf) of profit for every $1 of aviation sales. 



Garmin takes the road less traveled to Profit Land

🌙 Google ends a moonshot

__XL-sized cart full of "meh"...__ __[Walmart](https://robinhood.com/stocks/WMT)__'s disappointing  earnings. Physical store sales for the world's largest brick-and-mortar retailer rose barely 2% (a slowdown from last year's 4.2% growth). But there's light at the end of the aisle: ecommerce sales popped 37% for the year. The star? Walmart's online grocery biz.

- __Milking it:__ With its [265M](https://corporate.walmart.com/our-story) weekly global customers, 11.5K physical stores globally, and reputation for the lowest prices (outside Amazon), Walmart has the loyalty and locations to scale online grocery.
- __Lettuce rejoice:__ So Walmart's speedily [expanded](https://techcrunch.com/2020/02/18/walmart-reports-lower-than-expected-q4-earnings-despite-e-commerce-sales-growth-of-35/) online grocery — 3.2K locations  will bag your groceries ahead so you can just pickup curbside, while another 1.6K spots will cruise the aisles, bag, and deliver to your door. But...

__Walmart's overall ecommerce biz is still unprofitable...__ E-sigh. It's leaning into online grocery — which it thinks has profit puppy potential — while leaning out of its e-acquisitions:

- __Like an Innovation Vampire__, Walmart scooped up hip ecommerce startups to compete with Amazon, sucked the valuable digital lifeblood out of them, and threw them to the curb when they didn't live up to expectations. It's the *Twilight Saga*, but for retail.
- __After splurging on innovative companies since 2015__, Walmart's recently sold off __ModCloth__, laid off hundreds at __Bonobos__, ended __Jet.com's__ grocery biz, and just announced it's shutting down shopping service __JetBlack__. 


__Cash in the (e-grocery) bag...__ Grocery shopping is a habit. And owning habits means $$$ — [Over 1/2](https://www.wsj.com/articles/walmart-posts-mixed-holiday-sales-11582025656) of Walmart's US sales are from food. The US online grocery market is still in toddler stage, but it's predicted to take 20% of all grocery sales by 2025. Since [90%](https://corporate.walmart.com/newsroom/2019/02/13/automation-is-reshaping-work-across-america-a-new-report-explores-the-impact-and-how-communities-might-respond) of Americans live within 10 miles of a Walmart, its curbside/delivery grocery game boasts a critical foundation. That's how it can stay ahead of __Amazon__, __Instacart__, and __Target__.

Walmart's online grocery is thriving

__5 Stars for Convenience...__ 0 stars for congestion. The __[Uber](https://robinhood.com/stocks/UBER)__ and __[Lyft](https://robinhood.com/stocks/LYFT)__-led ride industry has made life easier for many: whether it's having a few too many margaritas with dinner, visiting a new city, or needing a ride to the airport. It's also never been harder in one way: traffic. Here's the low-down, based on studies summed up by the [WSJ](https://www.wsj.com/articles/the-ride-hail-utopia-that-got-stuck-in-traffic-11581742802#comments_sector):

- __The Pitch:__ Uber/Lyft pitched themselves as ride-sharing apps (picture 4 strangers in a Prius heading the same direction). Five years ago, Uber founder Travis Kalanick [said](https://www.wsj.com/articles/the-ride-hail-utopia-that-got-stuck-in-traffic-11581742802#comments_sector) it would end congestion: "*If every car in San Francisco was Ubered there would be no traffic.*"
- __The Reality:__ Congestion got worse. Most riders hail private cars — an estimated 70%-80% of rides in major metro areas are non-pool. Drivers in NYC and California cruise without passengers ~40% of the time. Though Lyft estimates 500K Americans gave up personal cars thanks to *ride-hailing* (not ride-sharing).

__Negative effects take a back-seat...__ When you can get contact solution delivered to your door same-day by Amazon, you're probably not thinking about delivery vehicles congesting streets. Similarly, users of ride-hailing services are likely to think more about convenience than traffic or pollution.




__Fibbing about your mission can be a (disturbingly) successful strategy...__ The reality of ride-hail apps is more driving, more traffic, more pollution, more horn honking, more air fresheners. If we were woke sooner to Uber being part of a problem, not part of a solution, we may be less likely to have started Ubering. But now Lyft/Uber are here to stay, despite years pitching a mission that wasn't accurate.
