Friday Dec.13, 2019

Hasbro's Baby Yoda toy nightmare

_Baby Yoda missing the train to Holiday Season 2019_

Hey Snackers,

There can only be up to three Friday the 13ths in a year. This is the last of the decade.

Over in the UK, Brexit-committed Boris Johnson won the election to extend his Prime Minister-ship. Back in the US, stocks popped to record highs on hints that an outline of a US/China trade deal was close (we’ll update you when it's official).

Play

Hasbro misses huge holiday toy opportunity with Disney's "Baby Yoda"

Furious with you, I am... When the CEO of toy company Hasbro snuggled into his sofa to watch Disney+'s Star Wars-ish The Mandalorian series, he wondered what that adorable miniature Yoda thing was. It was hundreds of millions of should-be dollars for his company.

"Baby Yoda" is 50-years-old (diaper-age for yoda's species) and the cult star of the series.
But Disney kept him a secret until the show launched in November — it didn't even tell top toy-making partner Hasbro.
So parents ended up searching for "Baby Yoda" toys on Amazon over 90K times this past month (and ordered $100K worth of fake/unofficial ones).
Now Hasbro's unveiled a gaggle of Baby Yoda toys... but they won't arrive until May 2020.

This is "Tickle Me Elmo" money... The master of all holiday toys quintupled 1996 sales for its company (Tyco). The current popularity and undeniable cuteness of Baby Yoda could've driven similar holiday pandemonium, but Disney's stealthy self-serving moves were Hasbro's loss.

Hasbro is pretty much a Disney toy store... Hasbro paid big for the rights to be the official toymaker of Disney franchises Star Wars, Marvel, and Frozen. Now those toys are a huge part of its biz — 27% of Hasbro sales last quarter came from "partner brands." That's corporate-speak for Disney's billion-dollar character franchises, from Elsa to the Skywalkers.

Ride

Lyft is launching a car rental service (it's a tough day for Avis stock)

Lyft or rent? Now, you can sorta do both... Lyft already changed taxis. Yesterday it launched a rental car service starting in LA and SF. As little as $35 a day gets you wheels for a weekend getaway, right through the app. Here's how Lyft is competing with rental OGs like Enterprise and Hertz:

Car-to-Car service: Lyft will actually pay for your rides (up to $20 each) to and from the rental car lot.
Lower age: You have to be 25 to rent a car in the US (or pay extra) — Lyft is ok with 22-year-olds and up.
Tank-friendly: You don't have to give away your firstborn child to fill up your tank. Lyft will top-off your tank post-Napa weekend, charging just the local gas price (no fee).
Clean machine: Lyft also has a leg up over car-share startups like Getaround and Turo, since you're not getting someone else's car (and forced to endure their BO).

If it sounds too good to be true, it probably is... With all these perks at low costs, we're guessing this car rental scheme won't be profitable. Long-term, if they successfully snag your loyalty from Avis or Hertz, Lyft can increase prices to turn a profit. That's also the general plan for its core rides business... which is still unprofitable.

Charged

Delta's Investor Day reveals it's really a credit card company

All remaining passengers may now board... It's a pretty un-exclusive group that gets to show up at Delta's Investor Day: Any Delta shareholder. The airline uses the opportunity to humble-brag its most impressive company highlights. Here are some stats investors are proud of:

Your legs get less room: Average seats per aircraft jumped from 97 to 127 over the last decade. And probably not just because the planes got bigger.
At least the planes are more environmentally efficient: The company emits 11% fewer C02 emissions overall than it did in 2005.

Flight update: Delta is really a credit card company... We couldn't stop staring at slide #24 in the Investor Day deck — Delta's co-branded credit card with American Express is the airline's true profit puppy:

8% of all Amex spending in 2018 was on Delta.
That Delta/AmEx card earned Delta $1.4B in 2010 — and a whopping $4B this year.
Now the AmEx card is estimated to bring in 35% of Delta's profits.

Delta is a perfect card candidate... because its customers spend lots on it. If you splurge on a few LAX-JFK flights home every year, you'd prefer to use the airline card that's boosting your points situation. Delta owns a big chunk of its close to 200M customers' wallets — and the credit card is where it makes money off them.

What else we’re Snackin’

Desserted: Nestle sells its US ice cream biz (including Häagen-Dazs) for a mega-pint-sized $4B
Caf-fiend: Pepsi launches a soda-coffee hybrid drink after Coca-Cola's (creatively named) Coke Plus Coffee became a thing
Tight Ship: Amazon is shockingly delivering about half its own packages now as it eats away at FedEx and UPS
Bon Voyage: Bonobos' founder is leaving Walmart, just 2 years after his khaki-disruptor was acquired by Earth's biggest retailer
Ads Speak: Pandora is testing a new type of ad that lets listeners respond to questions (you listen to a pitch about meal kits, then it listens to you)

Friday

US retail sales report

Disclosure: Authors of this Snacks own shares of Disney and Amazon.

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Alphabet shares are soaring in the after-market session, with a initial jump of more than 10% implying a gain of upwards of about $200B in market value when the stock opens tomorrow morning.

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4/25/24

No, Apple hasn’t cut its Vision Pro production estimates in half

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?