With 11 celebrity brands launched so far in 2022, and celebrities including Hailey Bieber (rhode skin) and Scarlett Johansson (The Outset) making their first venture into the industry, it appears as though 2022 may be just as robust a year for celebrity beauty launches as 2021, which saw over 20 brands enter the market. The cosmetic category is popular amongst celebrities because it tends to be a high-margin category where there are many opportunities to white label products. As a result, it’s easy to get a brand off the ground with minimal product development or innovation, and it’s a quick way to capitalize on a celebrity’s fame to generate additional income. However, the velocity of new entrants into the celebrity beauty space is reaching a fever pitch and is reminiscent of the last peak of celebrity cosmetics – the celebrity fragrance boom of the early 2000s.
Elizabeth Taylor created the first celebrity fragrance franchise, and thus created the blueprint for the model, with her fragrance portfolio being managed by beauty conglomerate Elizabeth Arden. Eager to capitalize on royalties averaging 5 to 8 percent, between 1988 and 2014, more than 150 celebrities launched their own fragrance franchises, releasing nearly 500 scents in total. These celebrity scents were almost all one-noted. As a result, most of the sickly-sweet scents of the early aughts have been relegated to the shelves at discount pharmacies.
2022, with its flurry of celebrity line launches, may end up resembling 2014. 2014 was the last year of expansion for the celebrity fragrance industry; though 51 new fragrances entered the market, total revenues in the category declined by 17%. By early 2015, beauty conglomerates began whittling down their celebrity fragrance portfolios. Among the franchises that survived were Elizabeth Taylor, Jennifer Lopez, and Ariana Grande’s lines. These made their marks by bringing truly differentiated products to the budget perfume market and used synthetic molecules to replicate complex designer scents for a fraction of the price.
The formula for a celebrity beauty brand with staying power may not be so different. While the celebrity factor may amplify brand awareness and act as a powerful customer acquisition driver, for a celebrity brand to be both successful and enduring, it must bring to market a line of products that have a solid core value proposition and authentic messaging that resonates with the consumer. There are a handful of players in the celebrity beauty space following this playbook to great success, including Fenty Beauty (Rihanna) and Rare Beauty (Selena Gomez).
Fenty Beauty, launched in 2017 by Rihanna, has been a resounding success, partly because Rihanna is a celebrity with a large platform, but also because from the outset, the brand planted a flag in the inclusive beauty market, launching its banner product, a long-wear foundation, in 40 shades. Furthermore, Rihanna as the face of this brand makes the brand story even more authentic, given the brand mission is based on her real lived experience.
Rare Beauty, Selena Gomez’s brand launched in 2020, seems to be following in the footsteps of Fenty, centering the brand around a mission-driven message, making a commitment to donate $100 million to mental health over the next ten years through its Rare Impact Fund, and hosting “Rare Chats” on Zoom to solicit product feedback from the brand’s community.
With the celebrity beauty market potentially approaching saturation and consumers beginning to fatigue from the frenzied pace of new celebrity brand launches with little product differentiation, we are beginning to see certain lines attempt to adapt to achieve longevity. Some, such as Kim Kardashian (KKW Beauty, 2017; SKKN by Kim, 2022) and John Legend (Kinlo, 2021; and a yet-to-be-named line this year), are bringing several distinct brands to market with the hope that at least one will strike gold. Meanwhile, others are evolving existing lines, such as Lady Gaga (Haus Labs, 2019), who recently announced a rebranding and reformulating effort to stay relevant. With the momentum of the celebrity beauty business appearing increasingly unsustainable, we will all undoubtedly keep an eye on this market. Beauty industry cycles have proven to be ruthless in the past, and it remains to be seen which brands may be a hit today and a bust tomorrow.
Apparel & Footwear
Ted Baker has a new owner in Authentic Brands Group, the British brand said Tuesday, confirming a report in WWD earlier this week. As reported, ABG is set to acquire the entire issued, and to be issued, share capital of Ted Baker for 110 pence in cash, or around 211 million pounds, or $254 million. The price is one-third lower than the 160 pence-a-share that Ted Baker had wanted. The deal is expected to be completed in the fourth quarter of this year. In a filing to the London Stock Exchange on Tuesday, Ted Baker noted that ABG paid an 18 percent premium to the 93.1 pence share price at close of business on Monday, the last business day before the announcement. As reported in April, Ted Baker put itself up for sale after receiving a clutch of unsolicited bid proposals. ABG was always a front-runner, and sealed Tuesday’s deal after months of on-again, off-again negotiations. When Ted Baker put itself up for sale there were a number of interested parties, including Sycamore Partners, Bluestar Alliance and ABG.
The deal market in fashion has been something like a secret and brutal game of musical chairs. Last year’s rush of big-time consumer initial public offerings — from Warby Parker to Allbirds to Rent the Runway — has privately held brands looking to connect with a buyer and cash in as well. But the music has stopped, for now, and sellers still far outnumber buyers. WWD broke the news this month that Proenza Schouler, Khaite and A.L.C. have all tested the market or are still looking today. Outdoor Voices was likewise said to be considering a sale, according to a Bloomberg report. The company did not immediately return queries on Monday. Also said to be out in the market are Ganni, Isabel Marant and others, while the very strong and high-profile are most likely to connect with potential buyers at least willing to listen, as Tom Ford seems to have done through its reported talks with the Estée Lauder Cos. Inc., the brand’s beauty licensee. Ford is said to be looking for a deal that would value the company at about $3 billion. But being a promising brand in apparel isn’t enough — sellers also have to find the right buyer. Veronica Beard, for instance, is said to have gently tested the buyout market earlier this year but ultimately withdrew, finding no ready buyer willing to pay up for a brand of scale that’s growing.
Athletic & Sporting Goods
WellnessLiving, which provides a cloud-based business management software and integrated payments platform for fitness and wellness operators, announced that the Company has partnered with McCarthy Capital to accelerate its growth. In addition to McCarthy Capital leading the $46 million minority investment, CIBC Innovation Banking has provided $20 million in growth financing, bringing the total raised this round to US$66 million. Founded in 2013, WellnessLiving develops multi-tenant business management software to allow business owners to schedule classes, appointments and events, manage staff, process payments and increase member engagement. The Company serves an international market with customers in North America, Europe, Australia and New Zealand.
Ammo, Inc. acquired GunBroker.com, one of the largest online auction marketplaces dedicated to selling firearms, hunting, shooting, and related products, in May 2021. Ammo announced plans to split its marketplace and ammunition businesses into two independent publicly traded companies. The spinoff was the primary topic of Ammo’s conference call for the first quarter ended June 30, which saw the company bang out a 37 percent hike in sales with momentum behind both businesses while reiterating its guidance for the year. On a call with analysts, Fred Wagenhals, Ammo’s chairman and CEO, noted that since the company’s IPO in 2017, sales grew from $2 million in 2018 to an estimated $300 million for fiscal 2023. The 2021 acquisition and integration of the GunBroker.com platform and the recent completion of a new ammunitions-manufacturing facility in Manitowoc, WI, position the company to split the ammunition and marketplace businesses. The online and marketplace business will be called Outdoor Online, Inc., comprised of GunBroker.com and related online businesses. The second entity, Action Outdoor Sports, Inc., will support its legacy ammunition business, including Streak, Blackline, Stelth, Blue Line, AMMO Brass, and Hunt Ammunition brands.
Cosmetics & Pharmacy
Estée Lauder announced its full year 2022 results that reported net sales of $17.74 billion, an increase of 9% from $16.22 billion in the previous year. The company reported net earnings of $2.39 billion, compared to $2.87 billion in the previous year. Total reported operating income was $3.17 billion, an increase from $2.62 billion in the previous year. Estée Lauder also announced its fourth quarter 2022 net sales of $3.56 billion, a 10% decrease from $3.94 billion in the previous year. Net earnings were $52 million. Skin care reported full-year net sales of $9,886 million, compared to $9,484 million in the previous year. Net sales growth from La Mer, Clinique and Bobbi Brown was offset by a decline from Estée Lauder. Makeup reported full-year net sales of $4,667 million, compared to $4,203 million in the previous year. The growth was led by increases from both M·A·C and Estée Lauder. Fragrance reported full-year net sales of $2,508 million, compared to $1,829 million in the previous year. Net sales grew across every region and every fragrance brand, led by Jo Malone London, Tom Ford Beauty and Le Labo.
Everyone’s beauty routine is an extremely personal process, one that is becoming more customized with the rise of the personalized beauty market. According to a report from Research and Markets, the personalized beauty market is expected to grow from $29.25 billion in 2021 to $37.72 billion in 2022 at a compounded annual growth rate (CAGR) of 11.87 percent. The market is expected to reach $51.64 billion in 2026 at a CAGR of 12.08 percent. A personalization concept can range from a company questionnaire determining a consumer’s individual needs and tailoring products according to the gathered info, to scanning a consumer’s hair type and analyzing strands to determine a customized hair product set. Beauty News approached three personalized beauty brands, including Proven Skincare, Function of Beauty, and newly-launched The Hair Lab, to explore why this specific section of the beauty market is expanding so quickly.
Boulevard raised $70 million in Series C funding to continue revolutionizing the client experience for spas and salons. Boulevard is the premier salon and spa management platform designed to streamline operations, increase sales, and delight customers. Developed in collaboration with industry-leading owners and operators, the company’s all-in-one platform includes client self-scheduling, CRM, marketing, custom reporting, and integrated payment processing. Boulevard delivers an intuitive, modern SaaS solution to an industry traditionally underserved by technology, helping them unlock their full potential. Boulevard is based in Los Angeles and was founded in 2016 by Matt Danna and Sean Stavropoulos.
Discounters & Department Stores
Slashing its guidance for full year sales and margins, Kohl’s on Thursday said Q2 total revenue fell 8.1% year over year to $4.1 billion, with net sales down 8.5% and comps down 7.7%. Net income tumbled 62.6% and operating income fell 53.3%, per a company press release. Gross margin contracted 290 basis points to 39.6%. Leaning heavily on its Sephora tie-up, the department store now aims to bring those shop-in-shops to all 1,100-plus stores, per a separate press release Thursday. Sephora openings largely drove the quarter’s 3.4% SG&A expense increase, with Kohl’s store refreshes and Sephora build-outs totaling $36 million. The retailer now expects its 2022 net sales to fall 5% to 6% year over year, with operating margin of 4.2% to 4.5%. In May, it had expected net sales to be flat or rise 1%, with operating margin of 7% to 7.2%; that was down from its March guidance for a net sales rise of 2% to 3% and operating margin of 7.2% to 7.5%.
Target’s sales and earnings in the second quarter fell short of analyst estimates even after the retailer warned that it was rightsizing inventory in the face of flagging demand and refocusing around its best-selling categories. Operating income came in at $321 million, down 87% from last year, as gross margins fell on markdowns as well as increased costs from merchandise, shrink and freight. Target’s gross margin rate fell by nearly 9 percentage points. Comparable sales grew 2.6% — which came in below analyst estimates — with traffic up 2.7%. The company said that growth was driven by the food and beverage, beauty, and household essential categories.
Walmart posted a better-than-expected performance for the second quarter, with companywide revenue and earnings beating analyst estimates. In the U.S., comp sales rose by 6.5% and net sales by 7.1%, to $105.1 billion. Operating income in Walmart’s U.S. business fell 6.7%. Executives attributed lower operating profits and margins on markdowns and a higher share of grocery products in the retailer’s sales mix. With traffic and sales improving, management held its guidance for the second half, projecting comp growth of 4% in the U.S. for the full fiscal year.
Walmart has partnered with Paramount Global to bundle a streaming subscription into Walmart+ at no extra cost, a news release announced. Users of the retailer’s membership program gain access to the Paramount+ Essential plan, which carries a limited ad load, beginning in September. Financial terms of the deal were not disclosed. The addition of the streaming benefit does not change the $12.95 per month or $98 per year Walmart currently charges customers for Walmart+. Paramount+ Essential on its own costs $4.99 per month while a premium, ad-free tier of the streamer goes for $9.99 per month.
Emerging Consumer Companies
Outdoor Voices, the activewear brand founded in 2013, and backed by GV, General Catalyst, and NaHCO3, among others, is reportedly considering putting itself up for sale. According to sources familiar with the matter, the company has hired an advisor to explore options for the brand. Among the options are a sale or raising new funds. During the pandemic, activewear sales soared, and Outdoor Voices achieved a cult-like following around products such as The Exercise Dress. However, now, as consumer discretionary spending has waned over concerns of a recession, valuations in the activewear space have dampened.
The four-year-old, Los Angeles-based startup, which provides freshly packaged salads, heat-and-eat prepared meals and vegan overnight oats, has raised $7 million in funding. BlueYard Capital, Y Combinator, and Gaingels, among others, participated in the round. As consumers shift to healthier lifestyles, the fresh prepared foods market has grown to $34 billion. Positive Food’s take on fresh prepared foods is a vertically integrated solution, which allows the company to deliver products directly from its kitchen to stores, unlike competitors, which are forced to rely on third parties for production and distribution. The new funding will be used to expand logistics and into new channels beyond Whole Foods.
This week, Bravo Sierra, a men’s personal care company founded in 2019, announced its $17 million Series B fundraise. The round was led by The Merchant Club, with participation from AF Ventures and Mousse Partners, among others. The company develops male grooming products including shampoo, body wash, shaving cream, and deodorant, and tests them with its community “The Battalion”, a group of 2,500+ US Special Operations Forces, active service members and veterans. All of the company’s formulas are clean, vegan, cruelty-free, and made in the US. The company also donates 5% of sales to military quality of life support. In addition to the raise, the company announced it will be launching into Walmart stores nationwide on August 20, and it is bringing on Nicolas Geiger of L’Occitane Group as a new board member.
Food & Beverage
Laird Superfood said it received an unsolicited offer from EF Hutton SPV I LLC to pay $3 for each share of the plant-based food company. Laird, which has a market cap of about $23.5 million, said last week it had nearly $25 million in cash and no debt on its balance sheet. In a statement, Laird said it will review the proposal and “determine the course of action that it believes is in the best interests of the Company and all Laird Superfood shareholders.” Since Laird Superfood went public at $22 a share in late 2020, it has struggled with heavy competition and mounting losses. In January, the company picked Jason Vieth as president and CEO.
Private equity firm Butterfly announced today it has closed its sophomore fund, securing commitments from an undisclosed number of institutional investors, family offices, entrepreneurs, and food investors to invest a total of $1 billion in “seed to fork” food-focused entities. Compounded with its previous fund and co-investments, today’s announcement brings Butterfly’s total assets under management to nearly $4 billion. Launched in 2016, Butterfly has invested in a number of mission-driven food companies including avocado oil maker Chosen Foods and Pete & Gerry’s Organic Eggs. The fund launched when the firm was founded, with the goal of supporting innovative food companies spanning the value chain and supporting the pursuit of B-Corp certifications for its investments and the firm itself, according to Beck. The firm has focused on vertically integrated businesses, where it can have greater control over inputs such as crops and manufacturing processes.
Today, Chilean food tech company NotCo is selling plant-based milk made with pineapple and cabbage juices, plant-based burgers that contain bamboo fibers, and a new chicken product formulated with corn flour and strawberry extract. But in the future, said co-founder and chief technology officer Karim Pichara, NotCo could be selling food that tastes like falling in love or the carefree experience of childhood. Pichara, a creator of the company’s powerful Giuseppe AI technology that finds ingredient and function matches between traditional animal-derived products and items in the plant kingdom, said new patents are bringing new capabilities to the system.
Grocery & Restaurants
Lifted in part by inflation, SpartanNash tallied strong sales gains across its business segments in its fiscal 2022 second quarter. The grocery distributor also reported adjusted earnings per share (EPS) above the top end of Wall Street’s estimates. For the 12-week quarter ended July 16, net sales totaled $2.27 billion, up 7.9% from $2.11 billion a year ago, SpartanNash said Thursday. That compared with a 3.6% dip in the 2021 quarter, when the company cycled big gains from pandemic-fueled demand a year earlier. SpartanNash noted that the 2022 quarter’s increase reflects sales upticks in all three of its business units, which were favorably impacted by inflation. Net sales in food distribution, SpartanNash’s biggest business segment, advanced 5.9% to $1.12 billion in the second quarter from $1.06 billion in prior-year period, when sales were down 3.1%. In the grocery retail segment, net sales climbed 8.5% to $672.4 million from $620 million a year ago, when SpartanNash recorded a 1.8% decrease. Second-quarter 2022 military distribution net sales rose 12.4% to $483.2 million from $430.1 million in the 2021 quarter, when sales fell 7.1%.
Home & Road
Lowe’s on Wednesday reported second-quarter earnings that beat analysts’ expectations as the company said improved operations offset lower-than-expected sales that were hurt by a shortened spring. The home improvement retailer said sales to do-it-yourself customers were also hurt by lower demand for certain discretionary items, specifically in seasonal products like patio furniture and grills and some popular pandemic products such as freezers. Transaction volume was down 6% over the quarter, but average ticket rose 6.5% partially due to inflation. Comparable sales fell 0.3% overall, though home improvement in the U.S. saw a slight growth of 0.2% versus the same quarter last year. Lowe’s saw an increase in sales to professionals such as contractors and electricians. CEO Marvin Ellison said the company’s new loyalty programs are attracting more professional contractors and driving repeat visits. Professionals who were enrolled in the program spent three times more than those not enrolled, he said.
The home improvement retail giant Home Depot reported record earnings and sales for its most recent quarter. The company said Tuesday that overall revenue was up 6.5% from a year ago, to $43.8 billion. The company reported a net profit of $5.2 billion, or $5.05 a share. That topped Wall Street’s forecasts, as professional contractors and the do-it-yourself crowd kept spending. The numbers were strong across the board. Sales at stores open at least a year, rose 5.4% from the same quarter in 2021 in the United States and 5.8% at all locations worldwide. The company also reiterated its earnings and outlook for the full year. Customers didn’t make as many purchases as they did a year ago. The number of overall transactions slid 3%. But this decline in activity was offset by the fact that customers spent more on what they did buy. The average sales ticket was a little more than $90, up 9% from last year.
The saga of struggling retailer Bed Bath & Beyond keeps getting curiouser and curiouser. Shares of the company have surged more than 60% in the past week and soared nearly 250% in the past month thanks to meme investors on Reddit. Those self proclaimed “apes” have been touting the fact that Ryan Cohen, the Chewy founder and GameStop chairman, had taken a nearly 10% stake in the company just a few months ago. But it now appears Cohen is preparing to unload his shares in the retail chain. Cohen’s RC Ventures said in a Securities and Exchange Commission filing Wednesday that the firm intended to sell up to 7.78 million shares of Bed Bath & Beyond as well as more than 16,000 call options that gave RC Ventures the right to buy more shares. The planned sale represents the vast majority of Cohen’s stake in the company. “The exact reasons for Cohen ditching his stake are not yet known,” Neil Saunders, managing director of GlobalData, said in a report. “However, the extent of the problems at Bed Bath & Beyond are likely to have played a part in his reasoning.”
Jewelry & Luxury
Joining a trend that is shaking up the industry, Pandora announced Tuesday that it is launching a lab-created diamond jewelry collection in the U.S. and Canada on Aug. 25 that includes recycled silver and gold, according to a press release. The 33-piece Brilliance collection — featuring rings, necklaces, bangles and earrings — has diamonds created using 100% renewable energy, per the release. It launches following a pilot in the U.K. last year, which coincided with news the retailer would stop using mined diamonds. Pandora released Q2 earnings on Tuesday, showing that U.S. sales were down 12% year over year, which the company attributed to the lack of stimulus checks this year. 2022 guidance was unchanged and organic growth was 3% compared to 84% in Q2 2021.
Collectible timepiece platform WatchBox has named Jack Forster, the former editor-in-chief of Hodinkee, its global editorial director. Forster will boost the site’s editorial content and help formulate its video strategy and global events. Forster joined Hodinkee in 2015 and initially served as the site’s managing editor. In 2017, he was appointed the watch information site’s editor-in-chief. Prior to that, he worked for eight years at Revolution magazine, first as group technical and features editor and then as editor-in-chief for the magazine’s U.S. edition.
Watches of Switzerland kicked off its fiscal year on a high note but is looking cautiously to the year ahead. “The first quarter continued with strong momentum throughout, and we carry this positive momentum into the second quarter,” said CEO Brian Duffy. “Despite the well-publicized concerns about the macro-environment, demand for our products remains robust, with client registration of interest lists continuing to extend.” Here are five important takeaways from the company’s recent earnings report. Watches of Switzerland had a strong start to the year, with U.S. revenue doubling.
From $300 bucket hats to $900 sneakers and $700 t-shirts, the high-flying luxury sector is fretting over the appetite among financially stretched Gen Z consumers for such “aspirational” purchases. Executives are troubled in particular by a hit to young Chinese shoppers, not only because mainland China has been a major driver of the industry’s growth in recent years, but also because high end consumers in the world’s second-largest economy are a decade younger than the global average of 38. Young adults around the world have been “a very strong factor of luxury growth over the past decade,” said Gregory Boutte, chief client and digital officer at Gucci-owner Kering. Data this week showed China’s economy slowed unexpectedly, prompting a central bank rate cut, while macroeconomic trends are disproportionately impacting the extra funds that those born between 1996 and 2012 might use to enter the world of luxury.
Office & Leisure
Mattel Inc sued the maker of Rap Snacks in Los Angeles federal court Thursday, alleging its Nicki Minaj-branded “Barbie-Que Honey Truffle” potato chips violate Mattel’s trademark rights in the famous Barbie doll. Mattel said it never gave Rap Snacks Inc permission to use its trademarks. The toy maker asked the court for an order blocking Rap Snacks from using the “Barbie” name, as well as money damages including profits from “Barbie-Que” sales. Minaj is not a defendant in the case. Her label Universal Music did not respond to a request for comment on the lawsuit. The rapper has long used “Barbie” as part of her persona, and she collaborated with El Segundo, California-based Mattel on a doll for charity in 2011. Miami-based Rap Snacks has teamed with several famous rappers to make signature lines of snacks, like Snoop Dogg’s O.G. Bar-B-Que Cheddar potato chips. Mattel told the court that Rap Snacks’ Minaj-branded “Barbie-Que” chips, launched in June, create customer confusion and a false association with the “Barbie” brand.
Lego Group, the company behind everyone’s favorite birthday present-turned-heel poker, turned 90 years old on August 10. So how did the wooden toy company, founded in a carpenter’s workshop 90 years ago, become a multimedia powerhouse? In 1949, the company transitioned from wooden toys to the plastic bricks we know today. But while the bricks have stayed the same, the universe has multiplied. These days, the debate over the best on-screen Batman—what might be a toss-up between Christian Bale or Robert Pattinson—can’t exclude Will Arnett, the voice of the caped Minifigure in The Lego Batman Movie from 2017. And no Star Wars video game has come close to the campy fun of the Lego Star Wars franchise. It wasn’t always this way, though.
They say that dogs and their owners start to look alike after a while. Whether that’s true or not is open to debate, but now at least they can dress the same. Tommy Bahama has partnered with K9Wear to create a line of pet harnesses and apparel that will actually match the patterns offered in the company’s apparel for humans. K9Wear produces its own line of pet apparel and has collaborated with other fashion brands including Badgley Mischka on custom collections in the past. The Tommy Bahama x K9Wear collection will launch in November for holiday and will be sold on the Tommy Bahama website as well as at select department and specialty retailers around the U.S. K9Wear was founded by James Straggas who was frustrated when he tried dozens of options to dress his Boston Terrier who struggled with the cold Boston winters. K9Wear offers a patented hybrid harness that offers freedom of movement for dogs and features military-grade mesh for breathability and adjustable metal buckles.
Casino and racetrack operator Penn Entertainment has moved to fully acquire Barstool Sports by buying up 66% of the sports and pop culture media company in a deal announced via an SEC filing on Thursday. In the SEC filing Penn said the purchase “is expected to be completed in February 2023, after which Barstool will be a wholly-owned subsidiary.” The acquisition comes almost 3 years after the January, 2020 deal in which Penn — at the time known as Penn National Gaming — acquired 36% of Barstool in a deal that included the option to buy the entire company outright. The 2020 deal cost Penn $163 million; according to Bloomberg, Penn will pay a total of $387 million for the rest, split between two payments. Penn raked in $1.6 billion in revenue during the first fiscal quarter of 2022.
Technology & Internet
In its latest effort to contend with soaring inflation, Amazon is planning to raise fulfillment fees during the holiday season, passing off some of its increased costs to the millions of merchants who rely on the site to sell their products. Starting Oct. 15, and running through Jan. 14, third-party sellers who use Fulfillment by Amazon, or FBA, will have to pay 35 cents per item sold in the U.S. or Canada, the company said Tuesday in an email to sellers. For merchants using FBA, Amazon handles the process of picking, packing and shipping items. The holiday fee comes on top of existing charges that sellers pay for using FBA services. Those costs vary depending on an item’s size, category and weight. Amazon said it’s implementing an added holiday surcharge for the first time as “expenses are reaching new heights,” making it harder for the company to absorb costs tied to the peak shopping season.
Finance & Economy
Despite falling mortgage rates providing some relief to potential home buyers, mortgage applications fell to the lowest level since the turn of the century last week—providing fresh evidence that the housing market downturn may have room to run as some experts worry about how the collapse will damage the broader economy. Mortgage applications fell 2.3% from one week earlier, according to the latest data from the Mortgage Bankers Association, pushing overall applications to the lowest level since 2000 even as rates on the popular 30-year fixed mortgage slipped to a two-month low of less than 5.5%.
Retail activity was flat in July as falling fuel prices held back gas station sales and consumers turned more heavily to online shopping, the Census Bureau reported. While advance retail sales were unchanged, total receipts excluding autos rose 0.4%. Economists surveyed by Dow Jones had been looking for a 0.1% increase in the top-line number and a flat total ex-autos. June’s gain was revised down to 0.8% from 1%. Retail and food sales excluding gasoline and autos rose 0.7% from a month ago. The numbers are adjusted seasonally but not for inflation, and come during a month when the consumer price index also was flat. A tumble in fuel prices off their record nominal highs pushed down sales at the pump, with gas station receipts off 1.8%. Motor vehicle and parts dealers sales also fell sharply, declining 1.6%.