The Weekly Consensus

Food and Beverage Trends to Watch at This Week’s Expo West Show

Lars Hem

Later this week, many in the food and beverage ecosystem will gather in Anaheim, California for the annual Natural Products Expo West trade show. From humble beginnings in the 1980s when 3,000 people attended the first show, Expo West has grown to an expected 67,000 attendees this year with over 3,500 companies exhibiting.  The scale of the show is massive, spread over the entire Anaheim Convention Center, with almost 13 acres of exhibit space on the floor.  The growth of Expo West reflects the scale of the Natural and Organic Products industry, which, according to data analytics firm SPINS, will reach $300 billion in revenue in 2023.

The Consensus team will be attending Expo West.  Some trends that we will be watching at the show will include:

  • Transaction Activity:  Deal announcements, whether a small round of growth capital for an emerging brand or a major acquisition by a multinational CPG, tend to increase around Expo West.  A recent article in Food Dive following the CAGNY Conference noted that large food CPG companies are seeking to put cash to work through smaller, bolt-on transactions that add value to existing brand portfolios.  Expo West is fertile ground for brands that could be the targets of such transactions.
  • Plant-based 3.0:  Bellwether companies such as Beyond Meat, Impossible Foods and Oatly have struggled recently with slowing consumer demand.  The next generation of plant-based companies are making products with great taste profiles and cleaner ingredient labels.
  • New label certifications:  Natural and organic consumers have typically sought out products with Non-GMO and/or USDA Organic certifications.  New certifications such as Upcycled (i.e. recycling that results in a product of higher value than the original) and Biodynamic (i.e. holistic and ethical approach to farming and food) are growing in popularity and we expect to see brands using these certifications on their packaging.
  • Holistic nutrition:  The low fat, high carb diet is out, replaced with a focus on holistic nutrition encompassing a diet of healthy fats, ample protein, minimal sugar and low carbs.  Healthy living brands offering these attributes to consumers will be well represented at Expo West.
  • No alcohol products:  There is a growing body of science that recommends minimal to no alcohol consumption for optimal health.  Brands are leveraging innovative production techniques to create zero proof products in the beer, wine and spirits categories that taste like full-alcohol products.
  • Brain health:  Optimizing cognitive function is a priority for consumers.  Brands in the supplement and functional ingredient categories are increasingly offering products designed to improve brain health.
  • Food-as-medicine:  Consumer are increasingly seeking out food that provides specific health benefits such as reducing inflammation, improving gut health and boosting immunity.
  • Meal kit innovation:  Meal kits are increasingly focused on simplifying the cooking process.  From streamlined packaging, to pre-prepped ingredients, to advancements in “heat and eat” meals, meal kits are evolving to meet the needs of consumers busy lifestyles.

There will surely be more trends to watch at Expo West this year.  It is always great to meet the entrepreneurs at Expo West who are bringing innovative new food and beverage brands to market.  If you are attending Expo, look for the Consensus team on the trade show floor.  If you want to set up a time to meet, drop me an email at

Apparel & Footwear

Arezzo & Co. Takes Majority Stake in Buzzy Footwear Brand Paris Texas

Arezzo & Co. is stepping up its game, opening a new chapter in its 50-year-long history. The Brazilian conglomerate grouping brands such as Arezzo, Schutz and Alexandre Birman has acquired a majority stake in hip Italian footwear label Paris Texas. In particular, Arezzo & Co. has invested 25 million euros to take over 65 percent of the brand Annamaria Brivio launched in 2015, which generated sales of around 15 million euros last year. Marking the group’s first international acquisition, the deal will be officially revealed at a joint event during Paris Fashion Week. Arezzo & Co.’s chief executive officer and footwear designer Alexandre Birman underscored that the operation is just the first move toward a new, ambitious direction the company is taking. “This moment for us is very important and beyond just one acquisition. It’s the beginning of a new era of Arezzo & Co. and of a transformation that we have been studying and planning for years,” he said.


Ted Baker-owner Authentic Brands Group among Hunter Boot suitors

The American company behind brands such as Reebok and Ted Baker is among the suitors weighing bids for Hunter Boot, the royal warrant-holding footwear brand. Sky News understands that Authentic Brands Group (ABG), which also has a stake in David Beckham’s branded products portfolio, has expressed an interest in a deal with Hunter. An auction of the business is taking place after Hunter Boot secured a multimillion-pound funding lifeline, with existing shareholders injecting £5m into the business and lenders contributing a further £2m. Hunter, whose boots have often been seen adorning festival-going celebrities such as Kate Moss and the Princess of Wales, is working with advisers at AlixPartners on the auction. The company was last saved in 2020 through a £16.5m capital injection, part of which came from Pall Mall Legacy, a fund backed by Goldman Sachs and Three Hills Capital Partners, an existing shareholder. Pall Mall Legacy owns the majority of Hunter’s shares, with Searchlight Capital Partners, a private equity firm, and Pentland Group, the sportswear giant behind brands such as Speedo, holding the remainder.


Urban Outfitters Posts Mixed Fourth-Quarter Figures

Urban Outfitters Inc. managed sales increases at most of its store and digital channels in the fourth quarter, but saw earnings drop after taking markdowns to reduce inventories. Net income for the period ended Jan. 31 fell to $31.5 million, or $0.34 per share, from $40.95 million, or $0.42 a share in the year-ago period. Total sales increased 3.9 percent to a record $1.38 billion. By brand, comparable sales increased 15 percent at the Free People Group and 9 percent at the Anthropologie Group and decreased 10 percent at Urban Outfitters. That divide in sales between the groups has been going on for a while with the more affluent Anthropologie and Free People customers continuing to spend, while the younger crowd at Urban Outfitters pulled back. At the wholesale segment, net sales decreased 7 percent with a 13 percent decrease in Free People Group, while Urban Outfitters wholesale sales increased by $3 million. At the Nuuly segment, net sales increased by $25.5 million, driven by a 149 percent increase in subscribers by the end of the fourth quarter versus the end of the prior year’s quarter.


Former Intermix Leaders Said Now Consulting for Intermix

Changes keep coming at Intermix, the multibrand retailer, which was sold last fall to Regent L.P., a Los Angeles-based private equity firm. According to sources, Haro Keledjian, a cofounder of Intermix, and Sari Sloane, former fashion director at Intermix, are consulting to try and help the business regain its stature and are meeting with vendors to keep them on board. Sources indicated Sloane has been in the market meeting with vendors and Keledjian is doing more operational work and talking to landlords about leases. Market sources noted that Regent, which has no connections to the designer and contemporary sportswear market, is looking for Keledjian and Sloane to get in front of the vendor community to calm them down and talk about the future of the business. One source indicated the retailer is looking to offer a tighter edit and go in a more sophisticated direction. Sources indicated that Intermix is selectively paying vendors, and asking them to take reduced payments. Some vendors haven’t been paid yet on last fall’s merchandise, when they should have been paid in October, and have decided to discontinue business with them, sources said.



Athletic & Sporting Goods

MASTRY Ventures And General Catalyst Acquire NFL Sports Agency Athletes First

MASTRY Ventures announced, in partnership with General Catalyst, that it has acquired a majority stake in Athletes First. Athletes First is the premier football agency representing athletes, coaches, front office personnel, and broadcasters. Founded in 2001 by Brian Murphy, Athletes First has set itself apart by brokering countless record-breaking contracts, representing eight Super Bowl MVPs, the most first round NFL draft picks for three years in a row, and a prestigious list of NFL and NCAA coaches and front office personnel. The terms of the deal were undisclosed.


Running industry isn’t vulnerable to recession, Brooks and New Balance CEOs say

As economists and businesses weigh the probability of a shallow, mild, or even severe recession in 2023, CEOs from two household-name running companies remain optimistic about their prospects to weather any kind of downturn.  “I think running has a good shot of muddling through this economy with all of the ups and downs we see,” Brooks Running CEO Jim Weber told Yahoo Finance Live. “Over the last 30 years, it’s been more or less recession resistant. We saw it in the dot-com bust two decades ago, [and in] the Great Recession. Even in COVID, when retail shut down, people were out there running, and our category grew.”  New Balance CEO Joe Preston echoed Weber’s sentiment, noting that for some people, setting an exercise routine is as simple as lacing up sneakers for a run.



Cosmetics & Pharmacy

Live Tinted Closes $10 Million Series A Funding Round

Live Tinted has closed a Series A fundraising round of $10 million led by Monogram Capital Partners. Other investors are Unilever Ventures, Devonshire Partners and Silas Capital. The beauty brand has secured $15 million to date.  Founded by Deepica Mutyala in 2018, Live Tinted has sold 1 million units since launch. Mutyala’s focus has been on developing makeup and skin care goods for all skin types and tones.


UK-based Virtual Dermatology Startup Skin + Me Adds £10M in Series B Funding

Skin + Me is a UK-based startup that aims to revolutionize skincare by making medical-grade advice more accessible and boosting skin confidence. The company recently secured £10M in Series B funding led by Octopus Ventures. Skin + Me’s success is driven by increasing consumer awareness of prescription ingredients and a growing trend towards personalization in the skincare industry.  Across Series A and Series B funding, it is estimated that Skin + Me has raised a total of £18.3M, with Octopus Ventures £13m of that — deepening the relationship, and demonstrating their faith in the brand’s market-leading personalisation strategy.”


BeautyHealth Acquires SkinStylus

The Beauty Health Company is set to acquire SkinStylus, a US Food and Drug Adminstrayion -cleared microneedling device for an undisclosed amount.  The agreement represents a key step forward in BeautyHealth’s portfolio build-up strategy. Upon successful integration of SkinStylus into the BeautyHealth portfolio, the Company expects upside from the acquisition in 2024 and beyond. Beautyhealth’s flagship brand is Hydrafacial.



Discounters & Department Stores

Touting off-mall success, Macy’s mulls acceleration of small-store strategy

Macy’s on Thursday reported a Q4 net sales decline of 4.6% to $8.3 billion, with comps down 2.7%. Comparable sales at namesake Macy’s fell 3.3%, at Bloomingdale’s rose 0.6%, and at Bluemercury rose 7.2%. Gross margin shrank to 34.1% from 36.5% a year ago. Merchandise margin declines were largely from higher markdowns and promotions necessitated by competition and inventory management. Inventory was down about 3% versus 2021 and about 18% versus 2019. Net income tumbled 31.5% to $508 million, according to a company press release.


Target profits continue to slide as discretionary purchases slow

Same-day services – which include in-store pickup, drive up and Shipt – increased 4.3% in Q4, making up more than 10% of Target’s sales, the retailer reported on a Tuesday earnings call. Increased customer traffic drove comparable sales up 0.7%. Revenue for the quarter was nearly $31.4 billion. Target said its full-year sales increased 2.8% to $107.6 billion from $104.6 billion last year. Full-year total revenue of $109.1 billion was up 2.9% compared with 2021. Comparable sales for the year grew 2.2% on top of 12.7% growth in 2021. Target’s 2022 operating income of $3.8 billion was down 57% from $8.9 billion year over year. The retailer said higher freight, and supply chain costs, along with increased compensation and headcount in distribution centers drove its full-year gross margin rate down to 22.7% from 25.7% year over year.


Kohl’s mulls pricing changes in turnaround reboot

Kohl’s on Wednesday reported that Q4 net sales fell 7.2% year over year to $5.8 billion, with comparable sales down 6.6%. Net loss narrowed to $273 million from $299 million a year ago. Gross margin contracted by 1,016 basis points to 23%, mostly due to clearance markdowns. Inventory was down 4% year over year, according to a company press release. For the full year, net sales fell 7.1% compared to 2021 to $17.2 billion, with comparable sales down 6.6%. Gross margin contracted by 485 basis points to 33.2%. The retailer swung to a $19 million net loss from net income of $938 million the previous year.


Dollar Tree sales momentum continues in Q4

Dollar Tree’s consolidated net sales rose 9% year over year to $7.7 billion for the fourth quarter, the company said in a Wednesday earnings announcement. Gross profit increased 11.6% from the year-ago period to $2.4 billion, and operating income for the quarter increased nearly 7% to $618.1 million. Overall company same-store sales increased 7.4% in Q4. By banner, Dollar Tree comps increased 8.7% — driven by a 10% increase in the average ticket, despite a 1% decline in traffic — and Family Dollar comps rose 5.8%, which comprised a 5.3% increase in average ticket and 0.5% uptick in traffic. For the full year, consolidated net sales increased 7.6% to $28.3 billion, gross profit increased 15.5% to nearly $9 billion and operating income rose 23.5% to $2.2 billion. In its first quarter guidance, the company expects consolidated net sales to range from $7.2 billion to $7.4 billion.


Walmart’s store-fulfilled delivery sales nearly triple in two years

Walmart’s store-fulfilled delivery sales have nearly tripled over the last two years, and the company is now seeing more than $1 billion a month in that category, CFO and Executive Vice President John David Rainey said on the company’s Q4 earnings call Feb. 21. The retailer has been expanding its store-based delivery capabilities in recent years amid the e-commerce boom. More than 3,900 Walmart U.S. stores now offer same-day delivery, out of 4,717 locations overall, per an earnings presentation. Walmart U.S. isn’t the company’s only segment benefiting from increased delivery activity. E-commerce sales at Sam’s Club jumped 21% year over year in Q4, “with contributions from both curbside and ship to home,” Rainey said.



Emerging Consumer Companies

Rebuy raises $17 million for its AI-powered ecommerce personalization platform

Rebuy, a personalization platform for online retailers, has announced a $17 million series A funding round, led by M13, with participation from Dynamism Capital, R-Squared Ventures, Peterson Ventures and Sidekick Partners, as well as strategic investments from Ben Jabbawy of Privy and Nik Sharma. The company combines the flexibility and scalability of no-code, low-code and custom-code technology with AI. Rebuy has tripled its revenue over the last year, released 218 new products or feature enhancements and launched integrations with solutions in ecommerce including Klaviyo, Attentive and Tapcart. The company aims to help brands of every size and industry build hyper-intelligent shopping experiences across every stage of the customer journey. Rebuy will use the funding to enhance its intelligence engine, expand its platform capabilities and expand its team.


Fantasy Sports Startup, Champions Round, Secures $7 Million

Champions Round, the LA-based fantasy sports startup, has raised $7 million in a Series A funding round led by Point72 Ventures, a venture capital firm founded by Steve Cohen, owner of the New York Mets. The platform, which allows users to compete against each other in daily fantasy games, plans to use the funding to expand its team and develop new features. The company is tapping into a growing market, as fantasy sports continue to gain popularity around the world.


Warby Parker Narrows Losses in Q4 2022

Direct-to-consumer eyewear brand Warby Parker has announced its Q4 2022 financial results, reporting narrower net losses compared to the same period the previous year. The improvement was driven largely by a 41% reduction in marketing spend, and lower customer acquisition costs partly related to the company’s push into brick and mortar. The company has been expanding its brick-and-mortar presence in recent years, with 200 stores across the US and Canada. The company’s revenue also increased by 10% quarter-over-quarter, up to $147 million.


Food marketplace Shef raises $120 million in Series B funding

San Francisco-based food marketplace, Shef, has announced that it raised $120 million in a Series B funding round led by CRV, with participation from Andreessen Horowitz and Amex Ventures. The round also included $7 million in venture debt. Shef connects home chefs with customers in their local communities, allowing users to order freshly prepared meals that are delivered directly to their door. The company, which was founded in 2020, has quickly grown to become a leading player in the food delivery industry, with operations in 11 states across the United States. “With the expansion, more people who need access to income opportunities can join Shef,” co-founder and CEO Joey Grassia said. “On the demand side, we can now provide more access to healthy, high-quality, affordable meals, whereas in these more rural and suburban areas that is hard to come by.”



Food & Beverage

Food CPG makers are hungry for M&A, but taking ‘disciplined’ approach to acquisitions

Large food CPG companies are eager to put their cash to work through M&A, but executives said they’re currently being selective about which assets they target — prioritizing transactions that build on their exposure in certain areas or bring them into fast-growing categories.  After a prolonged period of mega-deals, companies have narrowed their focus to buying one-off brands, oftentimes in $1 billion-plus deals. Recent deals in this vein include Hershey snapping up Dot’s to broaden the company’s salty snacks portfolio, Coca-Cola purchasing the rest of BodyArmor to boost its stake in better-for-you sports drinks and Mondelēz International gobbling up Clif Bar to increase its presence in the high-growth bar business.


Going With Their Gut: BelliWelli Raises $15.4M

Gut health-focused snack bar brand BelliWelli announced this week it raised $15.4 million in a funding round that closed in January, led by New York-based private equity firm The Invus Group. The news comes only six months after the direct-to-consumer-first brand made its first major move into retail, launching into Sprouts stores nationwide in mid-October. The low-FODMAP, prebiotic, allergy-friendly snack bars are made with almond flour, oat flour, sorghum, probiotics and come in eight SKUs ranging from Chocolate Chip to Strawberry Shortcake. According to CEO Katie Wilson, recent SPINS data indicates that BelliWelli has become the fourth-highest turning bar in the single format category at the natural retailer on a dollars per total distribution points (TDP) basis since its launch, while the brand’s chocolate chip flavor specifically has earned the second highest dollars per TDP spot.  Founded in March 2021, BelliWelli has now set its sights on becoming the top-selling, women-focused bar brand in the natural channel.  According to research cited by Natural Grocers, 44% of Americans reported taking supplements in 2022 in order to improve their gut health. The retailer believes that in 2023, shoppers will look to diversify beyond pills and powders, incorporating foods that can also assist with “digestive comfort.”


Brynwood Partners backed Great Kitchens Food acquires Uno Food

Private label take-and-bake pizza company Great Kitchens Food Co., a subsidiary of Chicago-based Brynwood Partners VIII, LP, has acquired frozen pizza company Uno Foods, a division of Uno Restaurant Holdings Corp., from its owner, Newport Global Advisors. Financial details of the transaction were not disclosed.  Uno Foods was born from Pizzeria Uno, a Chicago restaurant opened in 1943 that served the first deep dish pizza, according to the company. Uno’s Pizzeria & Grill still operates as a restaurant today, but since 1988 the frozen pizza line has been manufactured in Brockton, Mass., and distributed to retailers from Boston-based Uno Foods. The company’s frozen product portfolio has expanded from deep dish pizzas to include frozen flatbread pizzas, thin crust pizzas, calzones, grab-and-go calzones, entrees, dips and more.  In addition to Great Kitchens, Brynwood Partners’ portfolio contains food and beverage companies including Harvest Hill Beverage Co., Carolina Beverage Group, Hometown Food Co. and Buitoni Food Co. The acquisition of Uno Foods increases Brywood Partners’ annual sales to approximately $2.5 billion, according to the company.



Grocery & Restaurants

Digital boom helps Kroger in Q4, FY 2022

With a merger with Albertson’s still pending, grocery giant Kroger continues to be a force all its own, and 2023 could be a monumental year. Kroger unveiled fourth quarter results on March 2. Total company sales were $34.8 billion in the final quarter of 2022, compared to $33 billion for the same period last year. Excluding fuel, sales increased 5.9% compared to the same period last year. Kroger’s progress in the digital arena helped bolster gains not only in the fourth quarter, but also for all of FY 2022. The grocer’s digital revenue grew 12% over the final three months, and for the year delivery sales were up 22%. Digitally engaged household numbers went through the roof, with Kroger reaching about 900,000 more than the previous year. “Kroger’s 2022 results demonstrate the strength of our value creation model. In 2023, we expect to build on this momentum and deliver revenue and EPS growth on top of the record results achieved over the past three years,” said Kroger CFO Gary Millerchip., cost saving initiatives and growth in our alternative profit businesses.”


Xperience Restaurant Group acquires Rio Mambo Tex Mex y Mas and The Rim

Xperience Restaurant Group — Cyprus, Calif.-based parent company of Chevys Fresh Mex, Sol Mexican Cocina, Solita Tacos, El Torito, and Las Brisas, among others — announced Thursday the acquisition of casual dining brands, Rio Mambo Tex Mex y Mas and The Rim scratch craft eats from RM Restaurant Group for an unspecified sum. Keeping in-line with the rest of the Mexican cuisine-inspired portfolio, Rio Mambo Tex Mex y Mas’ four locations offer a Tex-Mex-inspired menu of margaritas, ceviches, quesos, enchiladas, and more. The Rim, meanwhile, is a two-location homestyle restaurant serving retro-American, Texan-sized eats like burgers, pizza, Texas chili, pot roast, and Creole classics like shrimp and grits. Both brands will add six units to Xperience Restaurant Group’s growing portfolio of 68 restaurants operating throughout the United States, with plans to expand this year with new Sol Mexican Cocina restaurants in New York City and Boston.


Corner Bakery Café declares Chapter 11 bankruptcy

The Dallas-based fast-casual bakery-café chain, Corner Bakery Café, has declared Chapter 11 bankruptcy with estimated assets and liabilities both between $10 million and $50 million, according to documents filed in the Delaware Bankruptcy Court on Feb. 22. Corner Bakery Cafe ended 2021 with 172 locations — up six stores from the year prior when Roark Capital Group sold the struggling fast-casual chain to Pandya Restaurant Growth Brands in Oct. 2020, after being a Roark subsidiary since 2011. Pandya is no stranger to trying to turn around struggling brands, as the restaurant investment group owned by Jignesh Pandya of Bucks County, Pa. had also purchased Boston Market in April 2020.



Home & Road

Floor & Decor to open 32 to 35 locations in 2023; Q4 sales top $1 billion

Floor & Decor Holdings ended its fiscal year on a strong note, with increases across its top- and bottom-lines and its 14th consecutive year of comp sales increases. The specialty hard surface flooring retailer continued its expansion in 2022, opening 32 warehouse-format stores during the year. It ended the year with a total of 191 warehouse stores and six design studios across 36 states. “We remain on plan to open 32 to 35 warehouse stores in 2023,” said CEO Tom Taylor. The company’s net income increased 38.8% to $69.2 million, with earnings per share of $.64, in the quarter ended Dec. 29, 2022, compared to $49.9 million, with earnings per share of $0.46 in the year-ago period. Net sales increased 14.6% to $1.048 billion from $914.3 million last year. Comparable store sales increased 2.5%. For fiscal 2023, the retailer expects net sales of approximately $4,610 million to $4,750 million Comparable store sales are expected to range from approximately (3.0)% to flat.


Traffic rebounds at 2 home chains, but probably not the ones you’d guess

One has 242 stores in 39 states. The other operates just 46 doors. But they share the distinction of driving positive store traffic in January at a time when larger peers were still experiencing downturns. World Market kicked off the year with a 7.8% year-over-year jump in store visits after a small 0.4% uptick in traffic in December. TJX Cos.’s Home Sense chain operates just under 4 dozen stores, but its visits rose 2.6% in the first month of 2023, according to data. The foot traffic analytics firm’s data set includes Bob’s Discount Furniture, which saw visits jump more than 18% in January.  By contrast, traffic at HomeGoods and At Home was still lagging in January, although both showed improvement from steeper declines in the preceding months.


Revenues up, earnings down for Franchise Group in Q4

Franchise Group, which owns American Freight, Badcock Home Furniture & more and Buddy’s, posted gains in revenues but losses in income for the fourth quarter and full fiscal year 2022. For the quarter ended Dec. 31, 2022, total reported revenue for Franchise Group was approximately $1.1 billion, an increase of 18.4% from $942.3 million in the same quarter of 2021. Net loss was $710,000 or 8 cents per fully diluted share, compared with net income of $147.2 million in 2021, or $3.53 per share. For the full fiscal year 2022, total reported revenue for Franchise Group was $4.4 billion, up 35.1% from $3.3 billion in 2021. Net loss was approximately $68.6 million or $1.96 per fully diluted share, vs. net revenues of $363.8 million, or $8.67 per share. For fiscal 2023, FRG expects to generate revenue of approximately $4.4 billion with a net loss of approximately $1.4 million or 4 cents per share.


Shifting e-commerce winds impact 1stDibs’ Q4, year-end financials, an online marketplace focused on luxury products, including furniture and art, saw net revenues fall 15% year-over-year to $23 million for the fourth quarter and to $96.8 million, or a 6% decline, for the full year ended Dec. 31. Despite calling 2022 “a challenging environment for e-commerce,” CEO David Rosenblatt said 1stDibs “made significant progress on our strategic priorities, primarily auctions, international expansion, supply growth and improving our cost structure.” In the company’s earnings call, Rosenblatt noted 2022 began on a high note, with record gross merchandise value (GMV) in the first quarter brought about by “pandemic-related e-commerce tailwinds.” However, those tailwinds turned to headwinds as consumers shifted their focus from online to offline and from buying goods to seeking services, he said. Other factors contributing to the slowdown included inflation and a softer housing market.



Jewelry & Luxury

LVMH Takeover of Richemont Rumored, Report Says

There are “whispers” in the luxury industry that LVMH—owner of Tiffany and dozens of other high-end brands—might have its sights set on rival luxury conglomerate Richemont, according to Swiss newspaper Finanz und Wirtschaft. “Observers believe that [LVMH chairman Bernard Arnault] has already tried to put pressure on [his] Swiss competitor in a roundabout way,” it said. LVMH was said to be particularly interested in Richemont’s best-known jewelry holding, Cartier. Both LVMH and Richemont did not respond to requests for comment by JCK by the time of publication. The newspaper was careful to note that the takeover talk is currently “little more than a whisper.”


Christie’s Luxury Appoints New Global Managing Director

Christie’s has appointed Emmanuel Danan global managing director of Christie’s Luxury. Danan will direct all aspects of Christie’s luxury business across both live and online auctions and private sales. He will be based in Paris and report to Francis Belin, the president of Christie’s Asia Pacific, who oversees Christie’s luxury, Asian, and world art departments globally. Danan joins Christie’s from beauty brand Maesa, where he served as president for Europe and the Middle East. He has more than 22 years of experience in luxury, including 17 years with L’Oréal, where he was general manager of L’Oréal Paris for Western Europe.


Farfetch Aims to be at Center of Luxury Brands’ Shift to Digital

Luxury retail marketplace Farfetch is facing the same inventory and macroeconomic headwinds as other players in the sector but is pushing forward with plans to do more deals and further its mission to be the one-stop shop for high-end shoppers everywhere. Like apparel retailers at all ends of the fashion spectrum, Farfetch lost some momentum in its fourth quarter as heavy promotions and excess inventory were cleared at deeper sale prices as it revealed during its Q4 2022 earnings call on Feb. 23. “Our Q4 results reflect higher than expected GMV [gross merchandise value] from the marketplace, which was supported by strong supply growth from our luxury sellers,” Farfetch founder and CEO José Neves said as he also outlined an internal overhaul of the platform aimed at supporting growth in 2023 with the objective of achieving $10 billion in GMV within roughly 24 months, after already almost doubling since the start of the pandemic in 2020.


Tighter Sanctions on Russian Diamonds Are Likely Coming, JVC Warns

Leaders of the Group of Seven recently announced they will be working together to tighten restrictions on diamonds coming out of Russia, both rough and polished. The Group of Seven, or G7, is an informal, intergovernmental group comprised of seven industrialized democracies: the United States, Canada, France, Germany, Italy, Japan, and the United Kingdom. In a statement issued Friday—the one-year anniversary of Russia’s invasion of Ukraine—G7 leaders called on Russia to put a stop to the war in Ukraine, which has killed thousands of Ukrainians, forced millions more to flee, and led to the destructions of homes, hospitals, schools, critical infrastructure, and historic cities across the country.



Office & Leisure

Regal Cinemas owner Cineworld says shareholders will be wiped out

Regal Cinemas owner Cineworld, which filed for Chapter 11 bankruptcy protection last year, said Friday that it expected shareholders to be wiped out entirely, meaning they should not expect to recover any funds from a restructuring or sale of the business. The world’s second-largest movie theater chain — hit hard by the pandemic, like many cinema operators — has been in talks with its “key stakeholders” to develop “a plan of reorganization” that would allow it to emerge from bankruptcy, it said in a statement. Cineworld said it had also received a number of non-binding proposals to buy some or all of its business, but none of them involved an all-cash bid for the entire company. “Based on the proposals received to date, it is not expected that any sale transaction will provide any recovery for the holders of the company’s equity interests,” it said. The same would apply to a restructuring “in light of the level of existing debt that is expected to be released under any plan,” it added. The British company continues to operate its theaters around the world as usual, it reiterated in its statement on Friday. Last month, Cineworld announced it was closing 39 more movie theaters in the United States. Around 500 remain across the country.


Michaels expands inventory with online marketplace

Michaels is rolling out a new online marketplace. The Michaels Companies is giving its customers direct access to a wide new curated third-party assortment. The major North American specialty arts & crafts retailer is increasing its online product inventory from 250,000 items to more than 1 million goods via a new third-party digital marketplace. The marketplace features more than 750,000 curated products from selected sellers across categories including arts and crafts supplies, candle and soap making, leather and woodwork, baking, tools and tech, yarn, stitchery, kids, toys, education, journaling, and seasonal products. The retailer has built a full-service portal for sellers to manage their business on and enable direct integration, including a suite of seller APIs and connections with multi-channel integration partners such as ChannelAdvisor (a CommerceHub company) and ShipStation.


Microsoft set to win EU nod on Activision with licensing offer, sources say

Microsoft Corp is expected to secure EU antitrust approval for its $69 billion acquisition of Activision with its offer of licensing deals to rivals, three people familiar with the matter said, helping it to clear a major hurdle. Microsoft announced the Activision bid in January last year, its biggest ever, to take on leaders Tencent and Sony in the booming videogaming market and to venture in the metaverse which is virtual online worlds where people can work, play and socialise. The European Commission, which is scheduled to decide on the deal by April 25, is not expected to demand that Microsoft sell assets to win its approval, the people said. In addition to the licensing deals for rivals, Microsoft may also have to offer other behavioural remedies to allay concerns of other parties than Sony, one of the people said. Such remedies typically refer to the future conduct of the merged company. Microsoft President Brad Smith last month said the U.S. software group was ready to offer rivals licensing deals to address antitrust concerns, but it would not sell Activision’s lucrative “Call of Duty” franchise.



Technology & Internet

Best Buy tops holiday-quarter expectations, warns of sales declines in the coming year

Best Buy on Thursday reported holiday-quarter earnings and revenue that topped Wall Street’s expectations, as waning demand for consumer electronics wasn’t as bad as feared. For the coming fiscal year, the consumer electronics retailer said it expects revenue between $43.8 billion and $45.2 billion, a decline from its most recent fiscal year, and a same-store sales decline of between 3% and 6%. The company is expecting to feel the majority of that pressure during the first quarter and then level out in the second half of the fiscal year. “We are preparing for another down year for the [consumer electronics] industry,” said CEO Corie Barry on a call with analysts. Best Buy was a big beneficiary of sales trends during the Covid pandemic as consumers bought computer monitors to work remotely, home theaters to pass the time and kitchen appliances to cook more. Its quarterly sales were down about 3% from the same period before the pandemic when it reported $15.2 billion in revenue. Its pandemic-era momentum has teed up challenging comparisons for the consumer electronics retailer, particularly as shoppers feel strained by bigger grocery bills and other higher expenses fueled by inflation.


Meta Quest Pro VR headsets get a price cut

Meta will slash the prices of its Quest 2 and high-end Quest Pro headsets, the company announced Friday. The price of the 256GB Meta Quest 2 will drop from $499.99 to $429.99, while the price of the higher-end Meta Quest Pro will be slashed to $999.99 from $1,499.99. Meta lost $13.7 billion on its Reality Labs segment in 2022. That’s the business unit responsible for building the company’s ambitious metaverse technologies. Reality Labs generated revenue of $727 million in the fourth quarter, and $2.16 billion for all of 2022 — a decline from $2.27 billion in 2021 — including sales of Quest headsets. The Meta Quest Pro was launched in October, but its high price put it out of reach for most consumers. And there didn’t seem to be a clear professional use case either. The lower price could make it more attractive to both audiences. “Our goal has always been to create hardware that’s affordable for as many people as possible to take advantage of all that VR has to offer,” the company said in a release.



Finance & Economy

U.S. consumer confidence retreats, house price inflation cools further

U.S. consumer confidence unexpectedly fell in February, with the decrease concentrated among lower-middle-income households, though Americans grew more upbeat about the labor market.  The survey from the Conference Board also showed consumers apprehensive about buying big-ticket items like motor vehicles and household appliances over the next six months. But correlation between confidence and consumer spending has been weak. A strong labor market has kept Americans spending despite worries about the future fueled by the Federal Reserve’s stiff interest rate hikes to quell inflation.  Consumers expressed optimism about current economic conditions, but were becoming more fearful about the next six months.


Mortgage demand from homebuyers drops to a 28-year low

Mortgage rates moved higher again last week, pushing buyers back to the sidelines just as the spring housing market is supposed to be heating up.  Mortgage applications to purchase a home dropped 6% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Volume was 44% lower than the same week one year ago, and is now sitting at a 28-year low.  Mortgage rates have moved 50 basis points higher in just the past month. Last February, rates were in the 4% range.