Hey Snackers,
Dubai has already made a ski mountain indoors, put a police force in Lamborghinis, and dropped influencers in the desert. Now, the lavish city is using laser drones to make it rain.
Stocks ticked down from their records, after the Fed hinted it's getting closer to rolling back its economy-reviving money policies. But the techy Nasdaq jumped ahead of more strong tech earnings.
Meet the old crew for a Cold Brew... People are meeting for coffee again, lines are back at Starbucks, and Linda still can't decide if she wants the egg white bite or the cake pop. Starbucks had its best third quarter revenue ever, whipping up $7.5B in sales — up a frothy 78% from last year. And same-store sales jumped 10% from even pre-pandemic levels.
Too cold to handle... One theme stood out to us from Starbs' earnings: iced drinks are hot commodities. Cold drinks accounted for nearly three-quarters of total sales, up 10% from two years ago. Now, Starbucks is doubling down on the chill factor, since cold concoctions tend to be more profitable than plain old cups of Joe:
Daily habits are a gold mine... Starbs already owns one of the most reliable routines: the morning java run. Rewards members accounted for more than half of Starbucks' US sales last quarter. Now Starbucks is focused on milking more $$$ out of routines with premium upgrades. First, it was fancy breakfast sandwiches (shoutout Turkey Bacon & Egg White). Then, it was alt-milk drinks featuring Oatly. Decked-out cold drinks, like the Mango Dragonfruit Refresher, are the latest premium push.
Seeing the chip bowl half empty… Tesla reported record profit and deliveries for last quarter. Apple posted its best third quarter in its entire 45-year history. Despite these killer earnings, investors weren’t impressed: Tesla shares have fallen 3% since earnings, and Apple has dipped 1.5%. Why investors are feeling salty:
Chip-outta-luck... The WFH life ate up all the chips, which are crucial ingredients in everything from Chromebooks, to PlayStations, and cloud servers. When the economy rebounded faster than expected, the chip shortage got shorter — Ford and GM even had to shut down car-making plants. But for chip-makers, it’s more of a “bowl half-full” situation:
High demand isn’t always a good thing… Especially when it’s shortage-induced. You’d think chipmakers would be rejoicing. Instead, they’re struggling to crank out chips fast enough to meet demand. Just like companies are hankering for chips, chip makers are hankering for chip components. And many are paying extra for scarce chip materials, which can cut into profits.
Authors of this Snacks own shares of: Starbucks and Tesla
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