Tuesday Jul.28, 2020

⚾️ DraftKings' Major League Bust

_Guess it's back to Russian ping pong_
_Guess it's back to Russian ping pong_

Hey Snackers,

Experian is now letting you add monthly Netflix payments to help raise your credit score. Little does Experian know, the password moochers are everywhere. Could this be an elaborate ploy to see if you're still on your ex-boyfriend's cousin's account?

The Nasdaq led the market uptick with some Big Tech gains. In non-stock news: gold prices soared to a record high, and Bitcoin inexplicably surged to break $10K for the 1st time in two months.

Sports

DraftKings soars on live sports re-starting, then falls on MLB cancellations

Guess we're back to Spelling Bee re-runs... Or Russian ping pong. DraftKings took its fantasy sports app public back in April via SPAC merger (ICYMI: yesterday's SPAC rundown). In May, the sports betting company said it would live-stream sports events through its app. While live sports seemed as far away as an Arby's in a desert, DraftKings stock soared on the hope. Then it soared more when:

  • Sports were coming back: (minus the fans). The NBA is restarting play at the Disney bubble, the NHL is set to hit the ice in August, and the MLB took the field on July 23.
  • Bets were coming back: DraftKings had its 2nd-best day since March thanks to the MLB return. It was the #1 sport in its sportsbook this weekend (shocker).
  • Then COVID struck back: DraftKings stock plunged 8% after the MLB's announcement that two games were being postponed Monday because 12 players and 2 coaches tested positive for coronavirus.

What happens in one MLB team... probably doesn't stay in one MLB team. The MLB cancellations made investors realize just how fragile the whole live events situation is... and how quickly it can go south. Investors got hyped on reopenings, then plunged the stock when foreseeable setbacks emerged.

DraftKings occupies a weird spot in the corona-conomy... because its biz is so closely tied to external events. While lockdown couch-boredom would have people flocking to the app for entertainment, the lack of live sports leaves DraftKings powerless. Streamers like Netflix, HBO Max and Hulu will be in the same awkward position if TV/film production doesn't resume soon (although apparently Netflix has content hoarded for years).

Raise

Ro triples its valuation to $1.5B to disrupt healthcare, but is the trend-factor enough?

Like Viagra in Allbirds packaging... 3-year-old telehealth startup Ro (adorable) just raised a fresh $200M in funding, bringing its valuation to $1.5B (baby Unicorn). Ro started off selling men's hair loss supplements and erectile dysfunction meds. In typical startup fashion, Ro managed to make those things sexy by incorporating three major trends:

  • Direct-to-consumer: Everything delivered, so you don't have to pick up those Viagra or STD pills in person — they pounced on Pfizer's patents once they expired.
  • Trendy packaging: Sleek colors and minimalist Millennial typeset make excessive-sweat medication look like a Kylie lipkit. It's discrete, so you can proudly leave out that eczema cream on the nightstand.
  • Tele-everything: Get prescriptions via online doctor consultation and follow-up with your M.D. via in-app text.

Build the brand model, then explode it... Just like Amazon started with books, Ro started with 1 product — now it wants to conquer the digital health industry. Ro's big selling point: it doesn't want your health insurance info in exchange for prescription meds (direct payments only). Since launching men's meds, Ro evolved into a telehealth biz with 4 main verticals:

  • Roman: The flagship men's offering — from prostate health powder to hair loss drops.
  • Rory: The female version of Roman — from eyelash care to menopause meds.
  • Zero: Nicotine replacement treatments to quit smoking.
  • Ro Pharmacy: Delivers 500+ generic medications for a $5 flat fee.

But can it differentiate enough to disrupt?... Ro has big competition in the "new-age" healthcare space: Walgreens just dropped $1B to add easy-access doctors clinics in-store — it also offers prescription delivery and OTC delivery with Postmates. CVS is opening 1.5K HealthHUB clinics and doing OTC med delivery with DoorDash. TBD whether the 3 major trends Ro latched onto are enough to differentiate. If it's not enough to go mainstream, Ro will have to stay niche.

What else we’re Snackin’

  • Whoa: Google extends its coronavirus WFH order until July 2021 for almost all of its 200K employees.
  • Vax: Moderna shares jump on word it's getting an extra $472M in COVID vaccine funding from the US government.
  • Stimulate: The GOP unveils a new coronavirus relief proposal, including $1.2K checks and $200/week extra in unemployment benefits (down from $600/week, which expires this week).
  • Bro: Toy-maker Hasbro's sales fell 29% on store closures and product shortages — action figure sales dropped on no-new Marvel films.
  • Again: Warner Bros. will release Chris Nolan’s much-hyped thriller “Tenet” to international theaters on August 26 (but America has to wait).

🍪 Thanks for Snacking with us! Want to share the Snacks? Invite your friends to sign up here.

Tuesday

Disclosure: Authors of this Snacks own shares of Apple

ID: 1270788

Get Your News

Subscribe and thrive

Snacks provides fresh takes on the financial news you need to start your day. Chartr provides data visualizations on business, entertainment, and society. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Latest Stories

AI vs. AI
2h

Battle of the bots

Getting hired is hard work in the age of AI

Rani Molla
Monster
Walt Hickey
18h

When the chips are down

Super Micro Computer, which produces the kind of servers fueling the AI boom, declined to pre-announce earnings. This spooked investors and rattled the entire chips-producing sector. That sent Super Micro plunging 23%, and dragged down lots of their customers and suppliers down with it.

Markets
Bottom lines
21h
April 19: AmEx up, paint ain’t, banks sank
Sponsored by
Go Deeper with Market Depth

Nasdaq TotalView powers the need-to-know data serious investors rely on.

Read more
Scuba Diving in the Wild Blue Yonder in French Polynesia
2024-04-19-norway-fund-site

Norway now has a wealth fund worth $290k+ for every citizen of the country

William Coulman, David Crowther24h
Wind energy

More wind power capacity was installed last year than ever before

Tom Jones, David Crowther24h
World
Jack Raines
24h

Do you want to run the State Department of McDonald’s?

A couple of days ago, a tweet making fun at McDonald’s hiring a “Manager for Diplomatic Relations” went viral.

At first glance, the idea that McDonald’s, a burger franchise known for its double quarter pounders and perfectly salted fries, is expanding its diplomatic influence with policy makers in Foggy Bottom and the world at large sounds comical. But it’s actually crucial.

There are more than 40,000 McDonald’s locations spread across 115 countries around the world, and 90% of these stores are independently owned and operated franchises that pay royalties to the parent organization to operate. Tens of thousands of franchises operated by different owners with different beliefs, priorities, and values can get complicated, fast.

As we noted in Snacks in February, McDonald’s received heavy backlash from franchisees in countries including Saudi Arabia, Oman, Jordan, Kuwait, and Pakistan after McDonald’s Israel donated thousands of free meals to IDF personnel. But it wasn’t McDonald’s, as an entity, that made the donations. It was the owner of the company’s Israel franchises, who was acting under his own volition.

Read more

There are more than 40,000 McDonald’s locations spread across 115 countries around the world, and 90% of these stores are independently owned and operated franchises that pay royalties to the parent organization to operate. Tens of thousands of franchises operated by different owners with different beliefs, priorities, and values can get complicated, fast.

As we noted in Snacks in February, McDonald’s received heavy backlash from franchisees in countries including Saudi Arabia, Oman, Jordan, Kuwait, and Pakistan after McDonald’s Israel donated thousands of free meals to IDF personnel. But it wasn’t McDonald’s, as an entity, that made the donations. It was the owner of the company’s Israel franchises, who was acting under his own volition.

Read more
Tom Jones, David Crowther
4/19/24
The data doesn’t lie: Taylor Swift is the biggest pop star on the planet

TOPSHOT-CORRECTION / AUSTRALIA-ENTERTAINMENT-MUSIC-SWIFT
Matt Phillips
4/19/24

Nuke stocks up on AI excitement

For most of humanity, the thought of “nuclear-powered AI” sends a shiver down the spine. But the stock market is all for it! Just check out the list of top performing S&P 500 stocks this year. Just behind established AI plays — Super Micro Computer and Nvidia, you’ll find Constellation Energy, the largest operator of nuclear plants in the U.S. NRG Energy, which also operates nuclear plants, isn’t far behind. Bloomberg reports that CEO of power distributor Exelon — which spun off Constellation in 2022 — says in the Chicago area alone, AI could drive a 900% jump in demand for energy from data centers.

Tech
Rani Molla
4/19/24

China makes Apple remove WhatsApp, Threads, Signal and Telegram from app store

In its latest move to restrict foreign tech, Beijing has ordered Apple to remove a number of popular messaging apps from its app store there, including WhatsApp, Threads, Signal and Telegram.

These apps had only been available through VPNs but were popular nonetheless, according to the Wall Street Journal.

Apple said the Chinese government asked them to remove the apps in the iPhone maker’s second biggest market over “national security concerns.” Last week, China told its state-owned telecoms to phase out the use of US chips by 2027.

Exclusive | China Orders Apple to Remove Popular Messaging Apps

Exclusive | China Orders Apple to Remove Popular Messaging Apps

Apple said the Chinese government asked them to remove the apps in the iPhone maker’s second biggest market over “national security concerns.” Last week, China told its state-owned telecoms to phase out the use of US chips by 2027.

Your inbox is ready

Subscribe and thrive

Snacks provides fresh takes on the financial news you need to start your day. Chartr provides data visualizations on business, entertainment, and society. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Business
Rani Molla
4/19/24

Tesla's recall reveals just how bad Cybertruck delivery numbers have been

Thanks to a recall of Tesla’s Cybertrucks, we now know how many of them have actually been delivered: 3,878 since the EV company began releasing them to customers in November.

In its third and fourth quarter earnings report, Tesla said that its current Cybertruck production capacity was greater than 125,000 a year. Musk had previously said he expected to produce 250,000 Cybertrucks a year by 2025.

Either way, that’s a lot more than the roughly 775 it’s delivered each month so far.

The recall is over an issue with the gas pedal pad that, the National Highway Traffic Safety Administration says when pressed, “may dislodge, which may cause the pedal to become trapped in the interior trim above the pedal.” The cause of the issue: “unapproved” soap that the manufacturer used to aid in getting the pad on the pedal.

A Cybertruck customer this week posted a TikTok about a terrifying incident in which this happened and “held the accelerator down 100%” in his 6,000+ pound vehicle. Thanks to some quick thinking where he held down the brake and put it in park, he wasn’t injured.

This is the long-awaited Cybertruck’s second recall since it came out five months ago.

Tesla recalls the Cybertruck for faulty accelerator pedals that can get stuck

Tesla recalls the Cybertruck for faulty accelerator pedals that can get stuck | TechCrunch

Either way, that’s a lot more than the roughly 775 it’s delivered each month so far.

The recall is over an issue with the gas pedal pad that, the National Highway Traffic Safety Administration says when pressed, “may dislodge, which may cause the pedal to become trapped in the interior trim above the pedal.” The cause of the issue: “unapproved” soap that the manufacturer used to aid in getting the pad on the pedal.

A Cybertruck customer this week posted a TikTok about a terrifying incident in which this happened and “held the accelerator down 100%” in his 6,000+ pound vehicle. Thanks to some quick thinking where he held down the brake and put it in park, he wasn’t injured.

This is the long-awaited Cybertruck’s second recall since it came out five months ago.

Markets
Millie Giles & David Crowther
4/19/24

Cocoa hits $11,000

Cocoa prices are breaking records on an almost daily basis — with cocoa futures closing at (another) all-time high of $11,020 per metric ton yesterday.

That’s up 158% since the start of the year, and over 4x on the typical prices seen in 2022 — as crop production continues to fall short of demand.

Major cocoa-producing nations like the Ivory Coast and Ghana, which between them grow about two-thirds of the world’s cocoa, have seen excessive tree failure due to disease, changing weather patterns, and hot, dry conditions causing devastating droughts.

As such, consumers are starting to see the effects of the largest cocoa supply deficit in over 60 years: “shrinkflation” and reduced-cocoa recipes might soon hit your favorite chocolate bars, and Hershey stock was recently downgraded. Unfortunately, the worst may still be yet to come: the International Cocoa Organization expects production to lag behind demand by 374,000 tons for the 2023-24 season.

Cocoa prices

Why the World of Chocolate Is in Crisis

Why the World of Chocolate Is in Crisis

Major cocoa-producing nations like the Ivory Coast and Ghana, which between them grow about two-thirds of the world’s cocoa, have seen excessive tree failure due to disease, changing weather patterns, and hot, dry conditions causing devastating droughts.

As such, consumers are starting to see the effects of the largest cocoa supply deficit in over 60 years: “shrinkflation” and reduced-cocoa recipes might soon hit your favorite chocolate bars, and Hershey stock was recently downgraded. Unfortunately, the worst may still be yet to come: the International Cocoa Organization expects production to lag behind demand by 374,000 tons for the 2023-24 season.

Cocoa prices
4/19/24

Governments and companies tackle the climate crisis as damage intensifies

Jack Morse
Read
4/19/24

Extreme weather has cost the US $2.6T, and the number keeps rising

Max Knoblauch
Read
4/19/24

The cost of waste: e-junk and emerging tech add to America’s pollution prob

Nia Warfield
Read
4/19/24

The biz of electric vehicles: the EV transition hits speed bumps

Jamie Wilde
Read
Jack Morse
$10B blow
4/19/24
Bitcoin business will lose billions in the halving

Investors and miners have spent months prepping for the crypto-shattering event lying in bitcoin’s code. It’s finally arrived.

Silhouette of a bitcoin miner pulling a bitcoin logo from a hole
World
Friday, April 19th
4/19/24
What’s happening
Casey Newton
Platformer
4/18/24
Meta’s new AI paves the way for social networks where nothing is what it seems

Five ways of thinking about Llama 3, its latest large language model

Screenshot of Meta’s AI image generator, frog in a bathrobe
Power
Matt Phillips
4/18/24

World out of balance: It costs the US 3¢ to make 1 penny

The cost of producing a US penny rose 13% in fiscal 2023 to 3.07 cents. Yes, it means that Uncle Sam loses more than 2 cents for every cent it produces. (And no, you can’t make it up on volume.)

For the record, that’s the 18th straight year the penny’s face value has been below production costs, fueling calls for abolishing the lowest value denomination coin. Canada started to phase out the penny in 2013, joining Australia, Brazil, Finland, New Zealand, Norway, and Israel, according to Smithsonian Magazine.

3.07¢

Pop Quiz!

What’s the world’s busiest airport?
Don't be a sucka