Thursday Nov.03, 2022

🏰 Airbnb’s king-size quarter

Sea suite (Chesnot/Getty Images)

Hey Snackers,

Our sun is so… cute. NASA shared an ultraviolet photo of our solar system's smiling star that looks straight out of Teletubbies. Cue the intro.

US indexes fell sharply yesterday after the Fed announced its fourth straight rate hike of 75 basis points (as expected). J. Powell’s comments suggested that a pause isn’t in the cards anytime soon.

Yurt

Comeback kid Airbnb has its best quarter ever as IRL experiences become a rare commodity

Weekend in the treehouse yurt… Airbnb has doubled down on quirky lodging like tiny homes, desert RVs, and castles. That focus on “experiential” stays appears to be paying off: the rental platform posted its best quarter ever as travel demand stays hot.

Record revenue and profit: Sales spiked thanks to a record 90M guest arrivals and 100M “nights and experiences” booked. Earnings surged 46% from last year to $1.2B.
Yet: Airbnb shares have fallen 13% since it reported Tuesday, after it issued slightly lower-than-expected guidance for this holiday quarter.

Zooming in from a Portuguese windmill… If there’s WiFi, how would they know? These latest numbers show that Airbnb continues to be one of the best pandemic comeback stories. Airbnb’s biz was crushed when the pandemic hit, but it quickly embraced the WFH life and revamped its platform to complement changing travel trends. It’s using the new norm of flexible work to its advantage:

CEO Brian Chesky said that despite return-to-office requirements, 20% of Airbnb’s total nights booked remain long-term stays (think: a month or longer).
Wow-worthy stays: Last month, Airbnb made a $10M investment to build 100 absurd accommodations, from a floating avocado abode to a giant cheese wedge.

Real-life experiences are rarer than ever… In a society where socializing means chatting online and shopping means browsing the web, IRL experiences have newfound value. Chesky said: “Because the mall is now Amazon, the movie theater is now Netflix, people still want to get out of the house.” While consumers are cutting back in some areas, they’re still splurging on experiences. Yesterday, Kayak owner Booking reported that quarterly profit more than doubled from last year as travel bookings surged. Airbnb rival Vacasa is set to report next week.

Swing

From Serena Williams to Steph Curry, stars are backing Tiger Woods' venture to techify sports entertainment

8 MVPs, 1 pop star… Tiger Woods’ latest venture has a stacked roster of A-list investors. In August, Woods and fellow pro golfer Rory McIlroy launched TMRW Sports, a biz aimed at techifying sports entertainment. Yesterday we learned that Steph Curry, Serena Williams, F1 champ Lewis Hamilton, and Justin Timberlake are among TMRW’s newest backers. One of TMRW's first ventures is a new golf league — and it’s teeing up big buzz.

Topgolf for the pros: Starting in 2024, six teams of three PGA players will compete in 18-hole matches at a custom tech-infused arena (think: a stadium-size golf simulator).
FYI: Last year golf-related sales boomed thanks to the sport’s socially distant popularity, with brands like Callaway and Titleist notching record earnings.

Not your dad’s golf channel… Golf is gaining entertainment value as big players drive innovation. TMRW’s launch comes as the new Saudi-backed LIV Golf tour lures PGA players and fans with bigger prizes, looser schedules, and flashy festival-style tournaments. Meanwhile, Callaway-owned Topgolf's party-style atmosphere and accessible simulator tech have lured Zillennials (over half of its visitors have never played golf before).

Big players can change the game… because often they are the game. Tiger and his celeb-vestors want to use features like real-time stats and indoor arenas to attract younger fans and families to the old sport. Down the road, TMRW wants to expand into sports beyond golf. Meanwhile, soccer superstar Lionel Messi recently launched his own firm to invest in sports, media, and tech.

What else we’re Snackin’

Swipe: Tinder and Hinge owner Match beat earnings expectations as more users paid for perks like extra matches. Bumble, which reports next week, could signal if the search for love is inflation-proof.
Adflix: Netflix plans to launch its ad-supported tier today, but questions remain. The streamer's still talking to content kings like Disney and Comcast about whether it can run ads against their shows.
KenTaco: Yum Brands beat sales expectations as consumers hit up its Taco Bell, KFC, and Pizza Hut locations. Execs said premium menu items were popular, suggesting inflation hasn't spoiled appetites.
Heat: The Biden admin plans to offer lower- and mid-income Americans $13B+ in aid to reduce their energy bills this winter (picture: green upgrades, $$ for heating). Up to 1.6M homes could benefit.
CV$: CVS unboxed stronger-than-expected earnings and hiked its annual forecast. Pharmacy and retail sales were up as customers loaded up on face wash, prescription pills, and Covid tests.

Thursday

Jobless claims
Earnings expected from ConocoPhillips, Amgen, Starbucks, PayPal, Cigna, Regeneron, Moderna, Monster Beverage, Warner Bros Discovery, Block, Barrick Gold, Kellogg, and Live Nation

Authors of this Snacks own: shares of CVS, Disney, Match, Moderna, Starbucks, Block, Amazon, Netflix, Google, and Yum Brands

ID: 2572826

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Quite a few news outlets are reporting that Apple thinks it’s only going to sell 400,000 to 450,000 Vision Pros in 2024, compared a “market consensus” of 700,000 to 800,000. They’re all citing a note from Apple analyst Ming-Chi Kuo.

Obviously there’s no question that Apple’s $3,500 face computer will have a limited audience and could be a huge flop, but this also doesn’t seem like accurate news.

The issue is that 1) this 400,000 number isn’t new. Back in July of 2023, the Financial Times reported that Apple planned to make fewer than 400,000 units in 2024, reducing its initial projections of 1M units, citing two people close to Apple and, the Chinese contract manufacturer assembling the device. 2) It's unclear who was estimating 700,000-800,000 Vision Pros in the first place, but it appears that it was Ming-Chi Kuo himself?

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Chipotle continues to go on a tear, hitting a sales record

Hey it might not be the kind of AI stock investors are all hot and bothered over, but don’t sleep on the burrito business.

Chipotle posted much better-than-expected results on Wednesday, with sales rising 14% to a record $2.70B in the first quarter, which is like a billion additions of guac.

Profits jumped 23% to $359M.

Chipotle has quietly cruised higher over the last year. It’s up 63%, compared to the 24.5% gain for the S&P 500 over the 12 months through Wednesday’s close. Not bad for a rice-and-beans based business model.

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All in all the stock is down more than 10%. (Basically the opposite of what happened with Tesla yesterday).

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Why Tesla investors are holding on to hope for a cheap car

Despite terrible earnings numbers last night — declining vehicle sales, disappointing revenue and profit, enormous spending — Tesla stock is up more than 10% as of midday. That’s a welcome move for the car company, that’s been among the worst performers this year in the S&P 500.

Why the about face?

While Reuters reported earlier this month that Tesla is no longer making its long-awaited $25,000 mass-market car — news sent the stock, already suffering from headwinds across the EV industry, down even further— Tesla reported during its earnings that it’s going to make cheaper cars than it currently has.

Before the second half of next year, Tesla said it will release “more affordable models” that “will utilize aspects of the next generation platform as well as aspects of our current platforms, and will be able to be produced on the same manufacturing lines as our current vehicle line-up.”

So rather than release the $25,000 Model 2, Tesla is incorporating some of that technology into its existing models. UBS called it the Franken-3Y2.