Outside of eating turkey and shopping cyber week sales, watching football was the biggest event for Americans over the past couple weeks – as it is for the better part of 18 weeks each year. Growing up, my mother never watched football, but something changed for her this year. A big fan of Taylor Swift, this Thanksgiving my mother shared that she has been watching football regularly for the first time in her life, now that Taylor is dating Travis Kelce, tight end for the Kansas City Chiefs. She’s also been listening to the Kelce brothers’ podcast. I was shocked by this, and it got me thinking about the convergence of sports with an industry like beauty. This is an unexpected pairing, but one that we’ve seen gaining momentum, and one I suspect we will continue to see more of in the months and years ahead.
We’ve all read about Taylor Swift’s recent impact on the NFL, how it gained 2 million female fans and Kelce merchandise sales were up 400% in the early weeks of the season. But let’s not forget Taylor’s impact on the overall economy this year. It’s estimated that her U.S. Eras tour gave the economy a $5.7 billion boost in 2023. You’d think that someone with over 277 million followers on Instagram and this kind of sway with the public would be directly monetizing it beyond her music and tours, but interestingly, Taylor doesn’t have her own beauty or fashion product lines or even endorse any others (at the moment). Despite all her influence and impact, many people have noted that Taylor is also the new beneficiary of NFL viewer awareness now. Male NFL fans were a likely untapped market for her and for the brand she is building for herself.
While Taylor remains unaffiliated with any beauty or fashion lines, the past few weeks alone have proven that brands in these sectors are catching on quickly to the power of collaborating with sports and athletes. To name just a few examples, Kim Kardashian’s Skims became the official underwear partner for the NBA, Anastasia Beverly Hills makeup began sponsoring a race car driver, both Glossier and NYX began sponsoring WNBA players, and of course, LVMH announced they are sponsoring the 2024 Olympics. Further back, the most recent Superbowl aired the highest number of beauty ads in the game’s history and included a halftime show by Rihanna, who applied her Fenty lipstick midway through. There’s clearly something brewing in the sports zeitgeist with female beauty and fashion consumers. This has only been supported further by the Swift-Kelce relationship.
Fashion has a long history of partnering with athletes, but the beauty industry is catching up quickly. Perhaps beauty companies are interested in the large, generally untapped market that sports fans represent. Or perhaps it is the industry recognizing the connection between sports and wellness and responding to wellness’s growing influence in beauty. As someone who spent the past ten years trying to get people to consider their beauty ingredients, I’d be happy to see this trend lead to a further integration of wellness into beauty.
It is too soon to tell whether this type of influence will work for all parties involved, but I have a hunch it will – especially if millions of women across the country, including my mom, continue tuning into sports for the first time.
Headlines of the Week
One message to consumers is loud and clear this holiday season: It’s time to spend. And in the first couple days of the holiday shopping season, records have shattered. According to the National Retail Federation, 200.4 million people shopped online or in stores between Thanksgiving Day and Cyber Monday this year. This is an increase of 2% from 2022, and the highest number NRF has tallied since it started tracking holiday results. Spending was strong on both big shopping days. Black Friday saw a record $9.8 billion in online sales, according to Adobe Analytics. The firm found Cyber Monday sales rang up to $12.4 billion, 9.6% higher than last year. Consumers spent $15.7 million online each minute of the Monday shopping holiday. Big discounts and “Buy Now, Pay Later” arrangements, in which purchase costs are spread over time, helped drive the spending, said Patrick Brown, Adobe’s vice president of growth marketing.
Shein has confidentially filed to go public in the U.S. as the Chinese-founded fast-fashion juggernaut looks to expand its global reach with a long-rumored initial public offering, CNBC has learned. The retailer was last valued at $66 billion and could be ready to start trading on the public markets as soon as 2024, people familiar with the matter said. It is unclear how much the company is currently worth, but its valuation has been a central point of debate among Shein and the advisors it’s working with. A confidential filing is common, as it allows companies to communicate with the U.S. Securities and Exchange Commission and make any necessary adjustments to their filings in private. Over the next few months, Shein will likely make tweaks to its paperwork and answer numerous questions from the agency. The filing will be made public once the company is ready to move forward with its IPO. Shein has been on a meteoric rise over the past few years after it won over consumers across the globe with its fashion-forward designs, endless assortment and dirt-cheap prices. But Shein has faced a series of challenges along the way and faced accusations of using forced labor in its supply chain, violating labor laws, harming the environment and stealing designs from independent artists.
Apparel & Footwear
Victoria’s Secret & Co. took a bottom-line hit in the third quarter, but said early holiday trends were promising. Net losses tallied $71.2 million for the third quarter, compared with earnings of $24.4 million a year earlier. Adjusted losses of 86 cents per share proved to be steeper than the 78 cent deficit analysts expected, according to FactSet. Adjusted earnings per share matched up with the company’s guidance last month, calling for losses of 70 cents to 90 cents. Sales for the quarter ended Oct. 28 fell 4 percent to $1.3 billion. But Martin Waters, chief executive officer, said he was seeing some signs of momentum and is looking ahead as the company seeks to continue its transformation. Waters pointed to the company’s new loyalty program, improvements in customer experience online, product improvements and tweaks to the Victoria’s Secret brand.
As part of its newly announced turnaround plan, VF Corp. has cut about 500 jobs worldwide, a spokesperson said by email Thursday. “As part of VF’s new Reinvent strategy and with the aim of improving operational efficiency, we have eliminated approximately 500 salaried positions across the company globally,” the spokesperson said. “While these decisions are never easy, they will give us the financial flexibility to invest behind our brands and better position us for long term growth.” The conglomerate has been plagued by weak sales, especially at its once-thriving Vans skate brand. In its most recent quarter, Vans sales fell 21%. Timberland fell 6.8% and Dickies fell 8%, while The North Face posted 19% year-over-year growth to $1.1 billion. The company didn’t immediately address questions about whether certain brands are more affected by the job losses. Last month an activist investor slammed the company’s previous leadership and called for $300 million in expense cuts.
Ralph Lauren veteran John Szczepanski will join Vince Holding Corp. as chief financial officer on Jan. 2, the apparel company said on Wednesday. He has spent most of his 20-year career at Ralph Lauren in various finance leadership roles, according to a company press release. Szczepanski takes over from interim CFO Michael Hand, who stepped in earlier this year when CFO Amy Levy left. She had been promoted to the role at the start of the year, replacing David Stefko, who retired. But Levy left five months later to take a job at Centric brands. Vince, which runs retail stores and e-commerce, an outlet business and wholesale, hit a rough patch in recent years. Earlier this year, brand management firm Authentic Brands Group snapped it up. adding to its growing stable of struggling companies. Last year, Vince had shuttered its Rebecca Taylor business, selling off that intellectual property months later. There’s some continuity at the company, as Vince CEO Jack Schwefel, appointed in 2021, remains in that post. But the CFO role has had a revolving door. Earlier this month, the company announced a transformation strategy centered on cutting $30 million in costs over the next three years.
Dr Martens has warned its earnings will fall below expectations after the bootmaker’s business was hit by warmer autumn weather and weak US sales. The famous brand, which first became popular in the 1960s, said its trade in the US had become more challenging in recent months and that two of its major wholesalers had reduced orders. Global profits for the firm fell by 55% to £25.8m in its half-year results. The profit warning saw shares plunge by almost 25% early on Wednesday. Chief executive Kenny Wilson said trading in the second half of the year had been “mixed”, with sales across the world impacted by warmer weather at the start of autumn. “In the USA, where there is an increasingly difficult consumer environment, our results have been more challenged, led by weakness in wholesale,” he added. The company said in its results that widespread caution among Dr Martens wholesale customers had resulted in a “weaker order book than in prior years”, but added that trade in recent weeks in Europe, the Middle East and Asia-Pacific had improved. Dr Martens makes more than half of its revenues from its most recognisable products, the eight-holed 1460 boot and sister product the 1461 shoe.
Athletic & Sporting Goods
Norwest Equity Partners, a leading middle market investment platform founded in 1961, has acquired United Sports Brands, a dynamic portfolio of category-defining sporting goods and active lifestyle brands. With a collection of six unique brands — Shock Doctor, McDavid, Cutters, Nathan, PEARL iZUMi, and Glukos — USB is dedicated to advancing athletes with best-in-class sports performance and protective products. USB sells mission-critical products used at every level of sport including mouthguards, protective gear, sports medicine and therapy, cycling, gloves, and other sport focused accessories and apparel. The Company’s products are sold by top retailers in more than 65 countries, including sporting goods, specialty stores and e-commerce retail channels. NEP’s history with USB brands dates to 2008, when it acquired Shock Doctor as part of its consumer products portfolio.
Vista Outdoor, Inc. said late Wednesday that following consultation with its financial and legal advisors, its board of directors had rejected the unsolicited proposal received from Colt CZ Group SE to acquire the company. As reported by SGB Media, Colt CZ on November 22 made a cash-and-stock merger offer to acquire Vista Outdoor for $30 a share, or $1.74 billion. Czechoslovakia-based Colt CZ’s proposal calls for keeping the company together, scrapping plans to separate Vista’s Sporting Products and Outdoor Products businesses. In October, Vista reached an agreement to sell the Sporting Products segment, including CCI, Federal, Hevi-Shot, Remington, and Speer, to Czechoslovak Group (CSG), a defense-oriented firearms company also based in Czechoslovakia. The all-cash deal was valued at $1.9 billion on an enterprise value basis, which includes debt.
Cosmetics & Pharmacy
Four of bankrupt Amyris’ beauty brands have been sold at auction to the highest bidders. According to court documents, skin care brand Biossance has been sold to online beauty retailer THG Beauty, formerly known as The Hut Group, for $20 million. Centered around Amyris’ star ingredient, squalane, Biossance has long been considered the best brand on its roster and the most likely to find a buyer. Elsewhere, Scent Theory Products paid $600,000 for 4U By Tia, launched in partnership with Tia Mowry to fulfill the needs of those with 2A through 4C hair textures by providing a streamlined assortment of need-based products. Dr. Reddy’s Labs paid $3 million for Menolabs, a women’s health and technology company that provides probiotics for women in perimenopause, menopause and midlife. And HRB Brands paid $1.75 million for clean baby care brand Pipette. As of yet there has been no word on some of its other brands for sale, including Naomi Watts’ menopausal beauty brand Stripes, color cosmetics line Rose Inc. with model Rosie Huntington-Whiteley, and hair care brand JVN with “Queer Eye” star Jonathan Van Ness.
Avon Products Inc. appointed Kristof Neirynck as its new chief executive officer. Avon’s parent company, São Paulo-based Natura & Co., said in a notice to the market Thursday that Angela Cretu is stepping down from the CEO role on Jan. 1. Cretu has been with the company for 25 years, and will serve as a senior adviser to API. Neirynck is currently API’s chief marketing officer and managing director for Western Europe. Prior to Avon, Neirynck held the job of chief marketing officer for global brands at Walgreens Boots Alliance, overseeing a portfolio of more than 20 owned brands across beauty and consumer health care categories. Natura has been selling off assets. Most recently, in mid-November, the company announced it had spun off The Body Shop to Aurelius Investment in a deal valuing the beauty chain at 207 million pounds. In early April, Natura sold the Australian luxury personal care brand Aesop to L’Oréal for an enterprise value of $2.53 billion.
Marubeni has announced that it has sealed a capital allowance deal to underwrite a third-party allotment of new shares by Osaji. The Japanese firm will invest some ¥1 billion in Osaji, which was spun off from Nitto last month. The company plans to expand Osaji’s sales channels in Southeast Asia and Osaji will pile the new funds into the construction of a plant in the region. Marubeni is hoping to transform its cosmetics business into a mainstay of its operations with at least three to four acquisitions per year, Nikkei Asia reports. Southeast Asia’s cosmetics market is growing by approximately 10 percent a year, making the region an attractive target for Marubeni.
Mav Beauty Brands, home to brands like Marc Anthony True Professional, Renpure, Cake Beauty and The Mane Choice, has obtained the approval of the Ontario Superior Court of Justice for the sale of substantially all of its assets and subsidiaries to an affiliate of LA-based Nexus Capital Management LP, for lower than the existing outstanding debt. Nexus previously invested in the Sugarbear beauty vitamin brand. The sale is expected to be completed sometime between December 8 and December 22, 2023. Business operations will continue uninterrupted, according to Mav Beauty Brands. Concurrent with the new agreement, trading of the company’s common shares on the Toronto Stock Exchange has halted; its common shares will be delisted on December 21, 2023.
Discounters & Department Stores
Off-price retailer Burlington’s inventory fell 8% year over year in Q3 to $1.3 billion as the company worked through reserve stocks it had purchased opportunistically in 2022. The company has been able to drive faster inventory turns by getting merchandise to stores faster, among other initiatives, CEO Michael O’Sullivan noted on an earnings call. Executives also outlined how the company planned to gain back 3 percentage points of lost operating margin since 2019 through freight initiatives and more efficient inventory management, among other efforts.
Dollar Tree Inc.’s consolidated net sales rose 5.4% to $7.3 billion in the third quarter, the company said Wednesday. At the company’s namesake banner, net sales rose 6.6% year over year to about $4 billion. Family Dollar net sales rose 3.9% to $3.3 billion. The company’s overall same-store sales grew 3.9%, while Dollar Tree comps increased 5.4% and Family Dollar comps grew 2% from the year-ago period. The company’s operating income fell nearly 21% year over year to $301.7 million from $381.3 million last year. Dollar Tree lowered its full-year outlook Wednesday. The company now expects its fiscal 2023 consolidated net sales to range from $30.5 billion to $30.7 billion, down from a previous range of $30.6 billion to $30.9 billion.
Saks will lay off 90 employees next year and end operations at a Wilkes-Barre, Pennsylvania, fulfillment center, according to a Nov. 7 Worker Adjustment and Retraining Notification (WARN) Act notice. Layoffs are slated to start on Jan. 6, with a second round of layoffs occurring on March 26, per the notice. Employees were notified about the layoffs in September. Saks will shift the facility’s volume to other company locations early next year, a spokesperson said in an emailed statement. “The Wilkes-Barre facility has become redundant for Saks given the more advanced capabilities available at other locations within our highly-scalable fulfillment network,” the spokesperson said. “We appreciate our Wilkes-Barre team members’ contributions and will support them as much as we can through this transition.”
Emerging Consumer Companies
Hang Media, the leading direct-to-consumer sports platform, has raised $9.2 million in a Series A funding round. The company’s HANG platform has attracted over 22 million young viewers who can interactively experience sports events alongside current players, all-time greats, and celebrities. The funding will be used to accelerate product development and audience growth, solidifying Hang Media’s position in the direct-to-consumer sports media category. The financing was led by The Operating Group, with participation from Clara Vista Investment Partners, Ratner Ventures, Brown Angel Group, and Anthony Baranello. HANG allows fans to mingle with their favorite athletes on livestreams across YouTube, Facebook, and Twitch. The platform has attracted hundreds of current athletes and legends, as well as entertainers, and averages 800,000 viewers per event. Hang Media’s unique combination of broad reach and deep Gen Z engagement has attracted leading sponsors such as Toyota, Wells Fargo, and Coca-Cola.
Better-for-you energy drink company LUCKY F*CK has closed a $4 million seed funding round led by Imaginary Ventures. The investment will be used to accelerate growth in Texas and California, increase production, and expand the team. This is Imaginary’s first investment in an energy drink company. LUCKY F*CK, founded by Richard Laver in August 2023, offers a range of energy drinks with natural flavors and five super ingredients. The brand has zero sugar, zero aftertaste, and is designed to be approachable for individuals over 18 who may have never tried an energy drink before.
4th & Heart secures $10 million to scale ghee stick production
4th & Heart, a brand known for its ghee stick innovation, has received a $10 million growth equity investment to expand its production. The investment was led by existing investor Cambridge Companies SPG and included participation from new and existing investors such as Boulder Food Group and Harbinger Ventures, as well as 15 professional athletes and several food industry operators and influencers. The $10 million investment will enable 4th & Heart to expand its operations and meet the growing market needs. With this funding, 4th & Heart aims to solidify its position as a leading player in the ghee market and continue to innovate in the space.
Food & Beverage
Ripple Foods, has raised another $49 million in its latest funding round, about two years after the Californian dairy-free protein company closed its oversubscribed $57.28 million series E led by S2G Ventures, Ajax Strategies, and Bloom8. Adam Lowry and Dr. Neil Renninger founded Ripple Foods in 2014 to use yellow peas as its primary protein source for a line of flavored plant-based beverages. The company has since rolled out a variety of non-dairy milk, protein shakes, and most recently, an unsweetened milk for kids. Ripple Foods continues to be led by CEO Laura Flanagan, and the deal makes it one of the few larger VC investments to women-led businesses. The SEC filing also listed Chuck Templeton, managing director of S2G Ventures, as a new director of Ripple Foods. Ripple Foods’ latest fundraise is expected to intensify competition in a $29 billion global dairy alternatives market that will grow at a 12.6% CAGR between 2023-2030. In the U.S., the company also faces direct competitions from other well funded players in the non-dairy space, notably Oatly, Califia, and NotCo, which has just debuted a plant-based mac ‘n’ cheese through its joint venture with Kraft Heinz.
EagleTree Capital has acquired the flavor and ingredients company Summit Hill Foods. Terms of the acquisition were not disclosed. Brands manufactured and marketed by Summit Hill Foods include Better Than Bouillon, Better Than Gravy and The Original Louisiana Hot Sauce. EagleTree said Summit Hill’s current management team will remain in place following the acquisition. Based in New York, EagleTree Capital is an investor in media and investor services, consumer, and the water and industrial sector. Past food industry investments have included the American Seafood Group, Harry & David, Odwalla and So Delicious.
Dairy giant Danone announced a partnership with the Global Methane Hub to reduce methane emissions in the dairy supply chain, becoming the first corporate sponsor of the Enteric Fermentation R&D Accelerator. The fund has raised $200 million thus far from an alliance of charitable organizations and governments. The goal of the accelerator program is to scale solutions for livestock farmers that can help them reduce enteric fermentation, which causes methane production in cattle. The money will fund research into feed additives, genetics, vaccines and other tech advancements to curb production of the harmful greenhouse gas, Danone said in a statement. As pressure mounts from activist investors and governments, more dairy producers are working to combat enteric fermentation. Danone is aiming for a 30% reduction in methane emissions from its fresh milk supply chain by 2030.
Grocery & Restaurants
Panera Bread has confidentially filed to go public again, people familiar with the matter told CNBC. The restaurant chain, known for its soups, sandwiches and bagels, has been signaling for months that it’s looking to go public through an initial public offering. In May, Panera announced a CEO transition and said the leadership changes were “in preparation for its eventual IPO” — amid a two-year IPO drought that ended in the fall. The company was last publicly traded in 2017. JAB Holding, the investment arm of the Reimann family, bought the company for $7.5 billion. In recent years, however, JAB has been reworking its portfolio. In 2021, it sold Au Bon Pain to a Yum Brands franchisee and took Krispy Kreme public. JAB also tried to take Panera public again that year. But in 2022, Panera called off its deal with Danny Meyer’s special purpose acquisition company.
Kroger might already be feeling the effects of deflation, as the Cincinnati-based grocer reported a relatively soft third quarter and revised its yearly outlook. Same-store sales for Q3 were 0.6% lower than they were at the same time last year. Wall Street was projecting a decrease of 0.5%. In its most recent quarterly statement, released Thursday, Kroger attributed the mediocre performance to declining prices. For fiscal year 2023, Kroger is forecasting same-store sales to increase 0.6% to 1% year-over-year, which is down from its original projection of an increase of 1% to 2%.
Home & Road
While global consumers spent an estimated $71 billion online on Black Friday, up 8% from 2022 according to software company Salesforce, the furniture category wasn’t the recipient of consumers’ largess. Online sales growth for furniture on Black Friday was down 11% year-over-year, with sales on the two days leading up to Nov. 24 down 13% and 6%, respectively. Order volume, however, was up slightly, rising by 4% year-over-year on Friday. Among furniture shoppers, traffic via computer was down 15% and down 4% for mobile on Black Friday. Searches and direct led online traffic for furniture on Black Friday at 37% and 34%, respectively. And mobile was the device of choice for shoppers, with 76% using the phones on Friday.
Although La-Z-Boy’s sales fell 16% in in the second quarter, they landed on the high end of guidance, spurring the company to up its dividend 10%. Sales for the quarter ended Oct. 28 totaled $511 million. They were up against a 6% increase in the year-ago quarter, which benefited from delivery of pandemic-related backlog orders. That year-ago comparison rippled across this year’s Q2 results. Written same-store sales for the entire La-Z-Boy Furniture Galleries network inched up 1% vs. a year ago, with company-owned written same-store sales essentially flat in a consumer environment that the company said remains challenged. Operating margin was 6.6% in the quarter on a GAAP basis and 7.9% on a Non-GAAP basis, which also exceeded guidance. Earnings per diluted share totaled 63 cents on a GAAP basis and 74 cents on a non-GAAP basis.
With losses mounting, high-end Italian furniture supplier Natuzzi has listed its iconic High Point showroom for sale. “We are actively engaged in the process to accelerate the sales of our non-strategic assets, the most relevant being our iconic building located in High Point, North Carolina,” CEO Antonio Achille said in a third quarter earnings report. The 0.8-acre property is valued at $8.4 million according to the Guilford County Tax Parcel website. The Natuzzi showroom has been a staple of design at every furniture market since its debut in 1998.
Jewelry & Luxury
Farfetch’s chief executive José Neves is reportedly conferring with top shareholders, including Richemont and Alibaba, and JP Morgan about delisting the company, The Telegraph reported on Tuesday. A take-private deal could happen imminently as Farfetch’s stock remains under pressure, according to the report. The e-tailer’s share price has plummeted more than 80 percent since its 2018 IPO. Details on whether Farfetch is being bought by a known entity like Richemont or a private equity firm are still unclear. Investors, however, appear optimistic about Farfetch going private. Its stock rose more than 22 percent before market close. Farfetch declined to comment on the news that it may go private. But shortly after The Telegraph’s report on Tuesday, Farfetch announced that it will not be reporting its planned third quarter earnings that were scheduled for Wednesday.
Claire’s Holdings, parent company of the ear-piercing chain, has appointed Chris Cramer chief financial officer and chief operating officer. He will oversee Claire’s finance, supply chain, technology, and North America real estate teams and report to its CEO, Ryan Vero. In a statement, Cramer said he was excited to join Claire’s as it transforms itself into “a powerful global fashion brand.” Cramer most recently served as president of Parade, a Gen Z–focused intimate apparel and loungewear retailer. Prior to joining Parade, he spent over 20 years with Bath & Body Works in different leadership roles, including chief financial officer and chief operating officer.
Black Friday may have set a record for in-store traffic, and jewelry was a big beneficiary, with three separate surveys saying the category logged strong gains over last year. RetailNext, which provides data on store visits, reported that foot traffic in jewelry stores increased 6.7% on Black Friday and 2.6% on Saturday of Thanksgiving weekend, compared with 2022. That made jewelry the second best performing sector tracked by the service, behind health and beauty (which enjoyed increases of 13.3% on Black Friday and 9% the day after), and surpassed the overall Black Friday jump in store traffic of 1.6%. “The increase in U.S. store traffic over Black Friday weekend is a positive development considering recent trends and is on the higher end of our expectations,” Joe Shasteen, global manager of advanced analytics for RetailNext, said in a statement. “This is a good sign for retail in the holiday period.”
Office & Leisure
Vail Resorts, Inc. has announced its agreement to acquire Crans-Montana Mountain Resort in Switzerland from CPI Property Group. Spanning over 1,400 meters (approximately 4,593 ft) of skiable vertical terrain and featuring 140 kilometers (approximately 87 mi) of trails, Crans-Montana Mountain Resort is easily accessible from five airports and by train. Situated in the Valais canton of Switzerland, the resort is located approximately two and a half hours from Geneva, less than four hours from Milan and Zurich, and is also two and a half hours away from the company’s other owned and operated European resort in Andermatt-Sedrun. Subject to closing adjustments, the resort operations are valued at approximately CHF 118.5 million, including around CHF 7 million in debt. Vail Resorts anticipates CHF 5 million in EBITDA for the fiscal year ending July 31, 2025, with projected growth from Epic Pass inclusion, network synergy, and guest experience investments.
Canadian exhibitor Cineplex has unveiled a definitive agreement with OpenGate Capital to sell Player One Amusement Group for $155 million, the company said Wednesday. The deal will see Los Angeles-based private equity firm OpenGate acquire all issued and outstanding common shares of the amusement gaming provider. The transaction is expected to close in the first quarter of 2024, subject to closing conditions, and includes a long-term agreement for Player One to continue supplying service amusement games to Cineplex theaters and location-based entertainment venues across Canada. Toronto-based Player One supplies amusement services and games across North America. Cineplex launched the business as Cineplex Starburst in 2015 as an amusement and gaming equipment provider and rebranded the company as Player One Amusement Group in 2016. “As we continue to focus on our growth plan, the strategy to divest P1AG came at an opportune time to strengthen our balance sheet,” stated Ellis Jacob, president and CEO of Cineplex.
Ellorie Jacobs loves everything Barbie. “The dolls are super fun to play with, and it’s about girl power,” the 9-year-old from Lakeville said during lunch with her mom recently at the Malibu Barbie Cafe at Mall of America. The blockbuster movie released in July has boosted California toymaker Mattel’s Barbie brand. And while it’s been a stalwart on toy store shelves for decades, there’s undoubtedly a new fervor around the doll and anything related this holiday season. Barbie sales jumped 25% for the July-August combined months vs. the same two-month period a year ago, according to Circana. It was the No. 1 doll globally in the third quarter (July through September), per Circana, The Barbie boom has come at a good time for Mattel. Toymakers overall have seen softer sales this year as many households trim spending while still having stockpiles of children’s play goods purchased during the pandemic. U.S. toy industry sales revenue declined by 8% through September, compared with the same nine-month period in 2022, Circana reported. After the Barbie movie craze, Mattel reported in October a 9% net sales increase in the third quarter, “with significant contributions from box-office participation” and consumer product partnerships, Chief Executive Ynon Kreiz said during a call with analysts.
Technology & Internet
A federal judge in Montana has blocked a law that would have resulted in a state-wide ban of TikTok starting on Jan. 1, 2024. Judge Donald Molloy explained his rationale for issuing the preliminary ruling via a legal filing released Thursday, saying the state of Montana failed to show how the original SB 419 bill would be “constitutionally permissible,” among other reasons. The ruling represents a setback for Montana, whose Governor Greg Gianforte signed into law the SB 419 bill in May, pitching it as helping “our shared priority to protect Montanans from Chinese Communist Party surveillance.” “Despite the State’s attempt to defend SB 419 as a consumer protection bill, the current record leaves little doubt that Montana’s legislature and Attorney General were more interested in targeting China’s ostensible role in TikTok than with protecting Montana consumers,” judge Molloy wrote in the filing. “This is especially apparent in that the same legislature enacted an entirely separate law that purports to broadly protect consumers’ digital data and privacy.” A TikTok spokesperson said in a statement the company is “pleased the judge rejected this unconstitutional law and hundreds of thousands of Montanans can continue to express themselves, earn a living, and find community on TikTok.”
ChatGPT, OpenAI’s viral AI chatbot, turns one today. A year ago, OpenAI released ChatGPT as a “low-key research preview” — reportedly spurred in part by an intense rivalry with AI startup Anthropic. The goal, OpenAI leadership told the OpenAI rank-and-file at the time, was to gather more data on how people use and interact with generative AI to inform the development of OpenAI’s future models. Initially a basic free-to-use, web-based and chat-focused interface on top of one of OpenAI’s existing models, GPT-3.5, ChatGPT would go on to become the company’s most popular product… ever — and the fastest-growing consumer app in history. In the months following its launch, ChatGPT gained paid tiers with additional features, including a plan geared toward enterprise customers. OpenAI also upgraded ChatGPT with web searching, document analyzing and image creating (via DALL-E 3) capabilities. And, leaning on speech recognition, voice synthesis and text-image understanding models developed in house, OpenAI gave ChatGPT the ability to “hear,” “speak,” “see” and take actions. Indeed, ChatGPT became priority number one at OpenAI — not simply a one-off product but a development platform to build upon.
Finance & Economy
U.S. consumer spending rose moderately in October, while the annual increase in inflation was the smallest since early 2021, signs of cooling demand that could further strengthen expectations that the Federal Reserve’s interest rate hiking campaign was over. Consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased 0.2% last month after an unrevised 0.7% gain in September, the Commerce Department’s Bureau of Economic Analysis said. Economists polled by Reuters had forecast spending gaining 0.2%. The moderation in consumer spending followed a brisk growth pace in the third quarter and reflects the impact of higher borrowing costs and depleted excess savings among low-income households. Though wages remain elevated, the pace of increase has slowed from earlier in the year as the labor market eases.
Higher mortgage rates appear to be doing very little to cool home prices. Nationally, prices were 3.9% higher in September compared with the same month a year earlier, up from a 2.5% annual gain in August, according to the S&P CoreLogic Case-Shiller Index. This occurred as the average rate on the 30-year fixed mortgage climbed toward 8%. Of the 20 metropolitan markets highlighted in the report, Detroit saw the biggest annual increase at 6.7%, followed by San Diego at 6.5% and New York at 6.3%. Three of the 20 cities, Las Vegas, Phoenix and Portland, Oregon, reported lower prices compared with a year ago. Those cities were some of the biggest gainers in the first few years of the Covid-19 pandemic.