Hey Snackers,
Here today, gone tomato: Dominoâs is closing all its remaining shops in Italy as locals shun the American-style pies. Twitter users were heated that Domâs ever tried in the first place.
Stocks finished lower yesterday, dragged down by tech (cough, chip stocks). Investors have eager eyes on todayâs July inflation report. One encouraging indicator: yesterday, for the first time since March, US gas fell below $4/gallon.
Fish and chips... More like fishing for chips. Yesterday, President Biden signed the "CHIPS and Science Act" into law. The bipartisan win comes after nearly two years of negotiations. The $280B package features $52B for boosting US chip manufacturing. Picture: funding for American chip titans like Intel, AMD, and Micron. And chipmakers are already making moves spurred by CHIPS:
Chips in the fridge⊠semiconductor chips, that is. Chips are critical to everything from smartphones and cars to military systems and medical equipment. But the US produces only one-tenth of the worldâs chips and is heavily reliant on East Asia, which accounts for three-fourths of global chip production. Taiwanâs TSMC alone churns out 90% of the worldâs advanced chips, and Chinaâs only growing more dominant in its chip game.
Sometimes you need to dangle the carrot⊠to incentivize change. US chip manufacturers have been offshoring new foundries to Asia for years in exchange for cheaper labor and production. Now this $52B package gives American manufacturers a financial incentive to build at home. Micron said its $40B investment would boost America's global memory-chip market share to 10% from 2%.
Shine bright like a (lab) diamond⊠Jewelry legend Signet is shelling out $360M in an all-cash deal to buy direct-to-consumer jewelry brand Blue Nile. Signet is the worldâs largest diamond retailer whose portfolio includes Kay Jewelers, Jared, and Zales (you know the jingles). Blue Nileâs modern designs and lower prices have made it one of the largest online diamond retailers and a zillennial go-to. The specs:
Every kiss begins with Kay... but it can only be Jared? US jewelry sales have more than doubled from prepandemic levels as consumers splurged on gold hoops and icy watches. But yesterday Signet cut its sales outlook for next year (and the stock plunged 12%) as econ worries threaten bling spend. Blue Nileâs digital dominance could help keep sales afloat, since more than half of Signet customers start shopping online.
Multichannel fits all⊠Signet is trying to expand its "connected commerceâ strategy â a frictionless shopping experience across sales channels (think: browsing in a showroom, then buying online). Since nearly all of Signetâs high-spending customers shop across channels, Blue Nileâs digital prowess could put it closer to its $9B annual sales goal. But the deal isnât expected to close until next year.
Authors of this Snacks own: shares of Moderna, Bumble, Disney, and Twitter
Correction: In the Snacks newsletter published on August 9, 2022, in the introduction we misstated that the consumer price index was dropping on August 9. It was set to drop on August 10. Weâve updated the online version of the newsletter, and we regret the error.
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