Story of the Week
Dow soars 1,500 points to record high in best day since 2022 after Trump election win
Stocks rallied sharply on Nov 6th, with major benchmarks hitting record highs, as Donald Trump won the 2024 presidential election. The Dow Jones Industrial Average surged 1,508.05 points, or 3.57%, to a record close of 43,729.93. The last time the blue-chip Dow jumped more than 1,000 points in a single day was in November 2022. The S&P 500 also hit an all-time high, popping 2.53% to 5,929.04. The Nasdaq Composite climbed 2.95% to a record of its own of 18,983.47. Investments seen as beneficiaries under a Trump presidency erupted as the former president appeared set for victory. Tesla, whose CEO Elon Musk is a prominent backer of Trump, saw shares surge more than 14%. Bank shares got a boost with JPMorgan Chase climbing 11.5% and Wells Fargo jumping 13%.
Apparel & Footwear
Steve Madden to slash China sourcing by as much as 45% as Trump’s tariff plan looms
Steve Madden said on Nov 7th that it will slash the goods it imports from China by as much as 45% over the next year as it braces for President-elect Donald Trump to carry out his pledge for steep tariffs on imports from other countries. On an earnings call, CEO Edward Rosenfeld said the shoe brand has been “planning for a potential scenario in which we would have to move goods out of China more quickly.” Over the past few years, he said, it’s looked for factories in other countries, including Cambodia, Vietnam, Mexico and Brazil. “As of yesterday morning, we are putting that plan into motion,” he said. “And you should expect to see the percentage of goods that we sourced from China to begin to come down more rapidly going forward.”
Outerwear brand Hawke & Co. to relaunch
Outerwear brand Hawke & Co. will relaunch following owner Michael Rosenberg gaining full control of the company, according to a press release on November 4. The company plans to release products that integrate “the latest in fabric technology, sustainability practices, and design versatility,” per the release. The brand hired Michael Macko as fashion director, who previously worked at Saks Fifth Avenue and menswear magazine “Details.” The company also named Blair Harrison-Carp as president of sales and planning, according to the release. Harrison-Carp has been with the brand since 2020, according to LinkedIn.
Wolverine Worldwide CEO Says Merrell and Saucony Sales ‘Outpaced Forecast’ in Q3
Shares for Wolverine Worldwide were up over 9 percent in pre-market trading on Nov 7th following continued signs that the company’s turnaround strategy is taking hold. The Rockford, Mich.-based company said total revenue in the third quarter of 2024 was $440.2 million, down 16.6 percent from $527.7 million the same time last year. Ongoing total revenue in Q3 – which excludes the impact of sold assets like Keds, Sperry and the Wolverine leather business – was $440.1 million, a decrease of 7.0 percent from $473.3 million the prior year period. While these results are still a marked decrease, Wolverine’s performance this quarter beat analysts’ predictions of sales between $418.6 million and $423.8 million in Q3, according to Yahoo Finance. “In the third quarter, we delivered better-than-expected revenue and earnings – led by Merrell and Saucony outpacing our forecast…,” said Chris Hufnagel, CEO.
Canada’s Gildan Activewear sees 2.4% sales growth to $891 mm in Q3
Canadian manufacturer of branded clothing, Gildan Activewear Inc, has recorded net sales of $891 million in the third quarter (Q3) ended September 29, 2024, up by 2.4 per cent vs Q3 2023. Gross profit was $278 million, or 31.2 per cent of net sales, versus $239 million, or 27.5 per cent of net sales, in the same period last year, representing a 370-basis point improvement, that was primarily driven by lower raw material and manufacturing input costs. The company generated an operating income of $193 million, or 21.7 per cent of net sales. This compares to $155 million, or 17.8 per cent of net sales in the same period last. Adjusted operating income was $200 million or 22.4 per cent of net sales, in line with the guidance provided, and up $43 million or 430 basis points compared to the prior year, as per a press release by Gildan Activewear Inc.
Athletic & Sporting Goods
Planet Fitness enters 11th hour bid for bankrupt Blink Fitness
Planet Fitness wants to acquire bankrupt budget fitness chain Blink Holdings, according to court filings viewed by CNBC. Planet Fitness previously lost out in a bankruptcy auction against U.K.-based, privately held fitness chain PureGym. Now the U.S. chain, with a public market valuation of roughly $6.8 billion, is making another attempt. Equinox Group-owned gym chain Blink Fitness filed for bankruptcy protection in August after a failed attempt by the luxury fitness group to enter the budget-friendly market. Since then, its more than 100 fitness centers have been tied up in bankruptcy court. Planet Fitness’s initial bid was rejected in part because of concerns around antitrust considerations, people familiar with the matter told CNBC. Planet Fitness already owns a significant share of the fitness club market with more than 2,000 clubs in the U.S., according to estimates by Piper Sandler. In making a subsequent play for Blink, Planet Fitness has submitted two offers, according to the filings.
Under Armour Beats Projections in Q2 as Restructuring Continues
Despite sales that were down in the double digits across the board in the second quarter, Under Armour claimed it continued to make headway in its quest to become a more premium brand. In the period ended Sept. 30, the Baltimore-based sports giant, reported operating income was $173 million. Excluding charges, the adjusted operating income was $166 million. Net income was $170 million and adjusted net income was $131 million. Overall sales were down 11 percent to $1.4 billion, in line with expectations. North America revenue decreased 13 percent to $863 million, and international revenue decreased 6 percent to $538 million.
Cosmetics & Pharmacy
E.l.f. shares soar as cosmetics brand raises guidance after posting 40% sales gain
E.l.f. Beauty raised its full-year guidance on Nov 6th after posting a 40% growth in sales. Shares of the company rose nearly 10% in after-hours trading. The cosmetics retailer’s earnings came in well ahead of expectations on the top and bottom lines and it now expects sales to be between $1.32 billion and $1.34 billion during fiscal 2025, ahead of the $1.30 billion analysts had expected, according to LSEG. Here’s how E.l.f. did in its second fiscal quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG: Earnings per share was 77 cents adjusted vs. 43 cents expected; Revenue was $301 million vs. $286 million expected.
Vitamin Shoppe owner files for bankruptcy
Franchise Group, whose banners include Pet Supplies Plus, The Vitamin Shoppe and Buddy’s Home Furnishings, said it is undergoing restructuring within a Chapter 11 bankruptcy filing. Franchised locations are not part of the process. The company will wind down its American Freight banner, “which has struggled due to sustained inflation and macroeconomic challenges facing the large durable goods sector,” per a company press release. Store-closing sales at locations nationwide and online begin on Nov 5th. A restructuring support agreement with holders of some 80% of its first lien debt will convert that debt into 100% equity in the reorganized business, the company said. Lenders have committed $250 million in debtor-in-possession financing, subject to approval by the U.S. Bankruptcy Court for the District of Delaware.
The former longtime Coty executive, who was most recently chief executive officer of publicly listed BeautyHealth, has been named Kenvue Inc.’s president of skin health and beauty in North America, Europe, Middle East and Africa. His remit will include brands like Neutrogena, Aveeno and OGX, in those regions. Prior to joining Kenvue, Stanleick served as the president and CEO of BeautyHealth, owner of the Hydrafacial device. Before that, he was executive vice president of Coty Americas, overseeing their portfolio of luxury and consumer brands across the region. He also served as the global CEO for the joint venture with Kylie Jenner Beauty and oversaw the Kim Kardashian business. Earlier in his career, Stanleick spent several years as president and CEO of Coach, Europe and South Asia and Pacific.
Discounters & Department Stores
Rick Dreiling stepped down as CEO of Dollar Tree on Sunday, the company said in an announcement late Monday. Dreiling also resigned from the company’s board. He is leaving due to personal health issues after leading the company for nearly two years. Dollar Tree named Chief Operating Officer Michael Creedon interim CEO. The retailer said its board has initiated a search for a permanent CEO, which will include internal and external candidates. Additionally, Ned Kelly was elected board chairman following Dreiling’s departure. Kelly joined the board in 2022 and was re-elected to the position for the past two years.
Target touts early Black Friday sale
Starting Friday, Target began dropping new deals every day and every week throughout the holiday season. Additionally, Target is launching a new early Black Friday sale from Thursday through Saturday. Early Black Friday offers include up to 50% off small appliances; 50% off Threshold holiday sheets, 30% off clothing and shoes; and 30% off trees and lights. Daily and weekly deals in November and December will change regularly. Both national brands, like Lego, Barbie, Dyson and Shark, along with Target-owned brands like Wondershop, Threshold, Good & Gather and Cat & Jack are part of the deals, which also include exclusive offers for Target Circle loyalty program members, the retailer said in a Wednesday announcement.
Emerging Consumer Companies
Indoor farming company, Bowery, to shut down after raising $700 million
Bowery Farming is laying off 187 workers and reportedly closing operations as the once well-funded indoor farming sector struggles with financial setbacks and rising costs. The New York City-based company, previously valued at $2.3 billion and backed by celebrities like Natalie Portman and Justin Timberlake, notified workers of layoffs at two locations last week. According to WARN filings, 104 people lost their jobs in Bethlehem, Pennsylvania, and a facility closed in Nottingham, Maryland, affecting 83 workers. Bowery, founded in 2015, is one of the largest vertical farming companies in the United States. The company uses controlled environment techniques to grow pesticide-free leafy greens and herbs, including lettuce, kale and basil, and services more than 850 grocery stores and major e-commerce platforms like Amazon and Walmart.
The online mattress brand Casper has become a subsidiary of Carpenter Co., a manufacturer of polyurethane foams. Casper, once deemed a DTC darling, has faced a number of changes over the past five years. The brand entered the public markets in early 2020 before the effects of the pandemic were fully realized across the industry. Casper’s initial public offering also came ahead of a wave of IPOs from DTC brands. But less than two years after its public debut, Casper announced it would be acquired by private equity firm Durational Capital Management, taking the brand private once again.
Vuori Share Sale Values Athleisure Startup at $5.5 Billion
Activewear maker Vuori will allow some early investors and employees to sell shares in a tender offer that values the company at about $5.5 billion. The tender is about $825 million, and the investors leading the tender are General Atlantic and growth equity firm Stripes. The deal is a jump from Vuori’s $4 billion valuation in 2021 — when the company raised $400 million from SoftBank.
Food & Beverage
Molson Coors buys majority stake in Zoa energy drinks
Alcohol giant Molson Coors is continuing its quest to conquer beverages beyond beer by purchasing a majority ownership stake in Zoa, the energy brand created by Dwayne “The Rock” Johnson. Financial terms of the deal were not disclosed. The deal gives Molson Coors a seat at the table in Zoa’s operations, with control over the brand’s marketing, direct-to-consumer sales and development strategy. Molson Coors first entered a distribution deal with Zoa in 2021, and last year boosted its investment in the zero-sugar energy drink brand. The Coors Light maker said in the press release the majority stake purchase indicates the growth potential it sees for the brand.
Lifeway Foods rejects Danone’s $283M ‘opportunistic’ takeover offer
Lifeway Foods rejected a Sept. 23 offer by Danone to acquire the kefir maker for about $283 million, or $25 a share. Danone, a long-time shareholder in Lifeway, currently owns 23.4% of its common shares. In a statement, Lifeway said its board determined that “Danone’s opportunistic proposal substantially undervalues Lifeway and is not in the best interests of the Company and its shareholders or other stakeholders.” Lifeway said its board adopted a limited-duration shareholder rights plan that will go into effect if an entity, person or group acquires beneficial ownership of 20% or more of the outstanding shares of the company’s stock. Shareholders would receive the right to purchase one preferred share of Lifeway’s stock for each outstanding share of common stock. A so-called position pill is meant to make it harder and more expensive for an acquirer to purchase a company.
1440 Foods Acquires FITCRUNCH to Enhance Leading Portfolio of Active Nutrition Brands
1440 Foods (“1440”), a leading portfolio of sports and active nutrition brands, announced the acquisition of FITCRUNCH, a protein bar brand, from celebrity chef Robert Irvine, Union Capital Associates, L.P. and its founders. FITCRUNCH’s Chief Executive Officer Patrick Cornacchiulo will become Chief Executive Officer of 1440. Financial terms of the private transaction were not disclosed. FITCRUNCH was founded in 2012 by Bakery Barn, a high-quality active nutrition manufacturer, and Robert Irvine. FITCRUNCH’s growing assortment of great-tasting high-protein snacks, including bars, wafers and powders caters to fitness enthusiasts and everyday consumers looking to enhance their diets.
Grocery & Restaurants
Yum Brands earnings miss estimates as KFC, Pizza Hut same-store sales decline
Yum Brands on Tuesday reported quarterly earnings and revenue that missed Wall Street’s expectation as same-store sales at KFC and Pizza Hut slid more than expected. “The complex consumer environment that exists in many markets around the globe has contributed to pronounced regional sales variations, which has caused our system-sales growth to fall short of our long-term algorithm this year,” CEO David Gibbs said on the company’s conference call. In 2022, Yum raised its long-term target to 5% unit growth, 7% system-sales growth and 8% operating profit growth. Net sales rose 7% to $1.83 billion. Yum’s worldwide same-store sales fell 2% in the quarter, dragged down by weaker performances at KFC and Pizza Hut, which both reported same-store sales declines of 4%. The company’s sales have been hurt by pressures related to “geopolitical conflicts and challenged consumer sentiment,” Gibbs said in a statement.
Burger King parent Restaurant Brands falls short of 3Q expectations
Restaurant Brands International on Tuesday reported quarterly earnings and revenue that missed analysts’ expectations as domestic same-store sales growth for all four of its chains fell short of Wall Street estimates. The company’s worldwide same-store sales grew just 0.3% in the quarter. Burger King, Firehouse Subs and Popeyes all reported same-store sales declines in their home markets. But so far in the fourth quarter, same-store sales trends have improved. “October now is, for the whole business, positive, low-single digits of same-store sales, which is an improvement from what we saw in [the third quarter],” CEO Josh Kobza told CNBC. He credited more successful marketing promotions and better consumer sentiment in the U.S. for the improvement in sales. “If you look at some of the things that really drive finances for our guests, everything from gas prices are down, interest rates are starting to go down, inflation has really started to moderate a fair bit,” Kobza said. Burger King’s same-store sales fell 0.7% during the three-month period that ended Sept. 30. Analysts had expected the metric to be flat, according to StreetAccount estimates.
FAT Brands to spin off Twin Peaks and Smokey Bones in joint IPO
FAT Brands is one step closer to spinning off Twin Peaks and Smokey Bones and taking them public as a combined entity with the filing of a Form 10 Registration Statement with the U.S. Securities and Exchange Commission for the newly named Twin Hospitality Group. According to the Form 10, the Beverly Hills, Calif.-based company plans to spin off 5% of Twin Hospitality Group’s class A common stock to shareholders as the company is listed on Nasdaq as an independently owned private company. The remaining 95% of stock will continue to be held by FAT Brands. This is lower than the average IPO, which tends to spin off about 20% of the company to public shareholders and means that FAT Brands will retain a significant controlling interest in Twin Peaks and Smokey Bones after it goes public. “Establishing our company as separate from FAT Brands will provide us with a greater ability to focus on and grow our business,” Twin Hospitality said in the registration statement. “By separating the businesses, we will have the flexibility to implement strategic initiatives aligned with our business plan and to prioritize investment spending and capital allocation in a manner that will lead to growth and increased operational efficiencies of our company that otherwise may not occur as part of a larger, more diversified enterprise like FAT Brands.”
Home & Road
Buyout Firms Said to Circle Reckitt’s £6 Billion Homecare Assets
Advent International and Apollo Global Management Inc. are among buyout firms studying a potential acquisition of Reckitt Benckiser Group Plc’s homecare assets, according to people familiar with the matter. Reckitt is targeting a valuation of more than £6 billion ($7.7 billion) for the assets. Reckitt in July unveiled plans to sell some of the homecare brands it deemed non-core and also review options for its infant formula business. The UK-based company wants to focus on “power brands” like Strepsils lozenges, the Mucinex cold remedy, Gaviscon heartburn medicine and Durex condoms, along with some disinfectants like Dettol and Lysol that boomed during the pandemic.
Arhaus’ Q3 sales near even with 2023; income decline still sharp
For the third quarter of fiscal year 2024, Top 100 retailer Arhaus posted net revenues near levels it hit a year ago. Net income continued to lag, reflecting the challenged environment faced at retail. For the three months ended Sept. 30, the Boston Heights, Ohio-based retailer recorded $319.13 million in net revenue, a 2.18% slip compared with $326.23 million during the same quarter in 2023. Net income totaled $9.92 million, or 7 cents per diluted share, down 49.73% against $19.74 million, or 14 cents per diluted share in 2023. In the quarter, Arhaus recorded adjusted EBITDA of $23.11 million, giving it an EBITDA margin of 7.2%. Based on ongoing consumer trends, Arhaus adjusted its full year guidance to net revenues of $1.23 billion to $1.25 billion, down from $1.25 billion to $1.29 billion previously, with net income totaling $55 million to $125 million, compared with its earlier guidance of $125 million to $145 million.
Tempur Sealy defies industry trend with Q3 sales, income increase
Tempur Sealy International bucked the industry trend with its third quarter earnings reporting an increase in net sales and net income. The company reported net sales of $1.3 billion, a 1.8% increase for the quarter ended Sept. 30, compared with net sales of $1.27 billion in the prior-year quarter. The sales results were carried by a 12.4% increase in Tempur Sealy’s international business. Mattress brands Sleep Number and Purple Innovation, recently posted 10% and 15.3% sales declines, respectively, for the quarter. In today’s call with analysts, Scott Thompson, chairman and CEO, said the company has been taking “market share for more quarters than I can remember, and I don’t think that will change. I think we took a step forward in the third quarter in market share as compared to the last two quarters.”
Wayfair Q3 results show ‘resilience’ to industry challenges
Despite consumer trepidations on spending, Wayfair continues to take market share, said Niraj Shah, CEO, co-founder and co-chairman, during the company’s third quarter earnings call. “Q3 marked another proof point of resilience for Wayfair with further market share capture in the face of sustained challenges in the category,” said Shah in a prepared statement. Wayfair has consistently gained share every quarter since the end of 2022, he noted, using a combination of price optimization, improved logistics and better storefront experience on its websites and apps to capture and retain customers. For the quarter ended Sept. 30, Wayfair saw total net revenue fall by 2% year-over-year to $2.9 billion and U.S. net revenue decrease by 2.3% vs. the same quarter in 2023.
HomeGoods, Costco lead the pack with Q3 store visit growth
Third quarter traffic trended positive for many major home furnishings retailers, but two stood out distinctly. HomeGoods drove the sharpest increase in store visits among the home goods retailers covered in Placer.ai’s Q3 Quarterly Retail Review. For the period stretching from July through September, the TJX Cos. division saw store traffic climb 8.1%. Costco sailed in with traffic up 7.2% for the same period – continuing a strong run. In a separate report that took a deep dive into Costco, Place.ai noted that the warehouse club has logged consistently positive year-over-year (YOY) foot traffic growth each month since the beginning of 2024. The location intelligence firm’s Q3 report also found solid traffic growth for BJ’s Wholesale (+5.9%), TJMaxx (+5.6%), Sam’s Club (+5.2%) and Marshalls (+5.2%).
Jewelry & Luxury
Tapestry Tops Q1 Expectations as CEO Joanne Crevoiserat Touts ‘Position of Strength’
Tapestry Inc. topped expectations in its fiscal first quarter and is keeping its eye on the horizon now that its $8.5 billion deal to buy Capri Holdings has been blocked. The company’s net income slipped to $186.6 million, or 79 cents a diluted share, from $195 million, or 84 cents a year earlier. However, the bottom line was held down by $31 million paid for interest expense, most of that supporting debt that Tapestry took on to buy Capri. The Federal Trade Commission sued to stop the deal in April, arguing that bringing together Tapestry’s Coach and Kate Spade brands with Capri’s Michael Kors would create an accessible luxury giant with too much sway in the market. A federal judge bought that argument and stopped the deal with a preliminary injunction last month that is seen as ultimately ending the transaction all together.
Brilliant Earth’s Q3 Sales Fall 13%
Brilliant Earth posted double-digit declines in net sales in the third quarter, but CEO Beth Gerstein shared a positive outlook for the holiday season. On an earnings call Thursday evening, Chief Financial Officer Jeff Kuo said, “We’re pleased to report a quarter where we continued to successfully drive our strategic initiatives, innovate, meet our top-line expectations, and far exceed our profitability expectations, even in the face of industry headwinds.” Net sales in the third quarter ending Sept. 30 fell 13 percent year-over-year to $99.9 million, in line with its forecast. For the first nine months of the year, net sales totaled $302.6 million, down 6 percent. Notably, Brilliant Earth has been growing its non-bridal fine jewelry offerings, recently introducing a collection with conservationist Jane Goodall.
Pandora Posts Double-Digit Revenue Growth in Q3
Pandora reported a strong third quarter Wednesday, once again raising its fiscal guidance. The company reported Wednesday that third-quarter revenue was up 10 percent year-over-year at actual exchange rates (11 percent organic growth) to 6.1 billion Danish kroner ($877.1 million), with like-for-like sales growth of 7 percent. Revenue for the first nine months of the year totaled 19.71 billion Danish kroner ($2.83 billion), up 14 percent at actual exchange rates (15 percent organic growth), with like-for-like sales growth of 8 percent. “We are very pleased with our strong results this quarter, particularly in the context of the current macroeconomic backdrop,” said Pandora CEO Alexander Lacik. “We are transforming the perception of Pandora into a full jewelry brand and unlocking the next chapter of our growth by attracting more consumers to our brand. Step by step we are capturing the many untapped opportunities, and we will continue to invest in our strategic growth initiatives.”
Office & Leisure
Nintendo lowers full-year forecast as H1 sales fall 34% to $3.4bn
Nintendo has released its financial results for six months ended September 30, showing further declines in both hardware and software sales as the wait for the Switch’s successor continues. For the first half of its fiscal year, the platform holder reported a 34% decrease in net sales, 31% drop in hardware, and 27.6% fall in software. As a result, Nintendo has lowered its full-year expectations. The first half of Nintendo’s fiscal year suffered tough comparisons with the same period in 2023, when the company not only launched the best-selling Legend of Zelda: Tears of the Kingdom but also the box office smash that was The Super Mario Bros Movie.
Yeti Revenues Expand Double-Digits in Third Quarter on Wholesale Bounce
Yeti Holdings, Inc. profits rose 18 percent on an adjusted basis, driven by improving margins and a 10 percent sales gain. The maker of Drinkware and Coolers saw balanced growth across product categories and channels while updating its FY EPS outlook to the high end of its previous range. Net sales increased 10 percent. Coolers & Equipment net sales increased 12 percent. Drinkware net sales increased 9 percent. Wholesale net sales increased 14 percent. Direct-to-consumer net sales increased 8 percent. International net sales increased 30 percent. U.S. net sales increased 7 percent.
Solo Brands Logs Deep Q3 Loss on Terminated Marketing Contract, Impairment Charges
Lifestyle products company Solo Brands, Inc. posted a net loss of $111.4 million in the third quarter due to costs related to the termination of an underperforming marketing agreement, impairment charges for IcyBreeze and an impairment charge related to its declining stock price—results excluding the adjustments aligned with expectations with sales down 15 percent. The company’s brands include Solo Stove, TerraFlame, Chubbies, Isle, Oru Kayak and IcyBreeze. “Our third quarter results were in line with our expectations despite a continued challenging macroeconomic backdrop for big ticket consumer durable items,” said Chris Metz, chief executive officer of Solo Brands.
Pet Valu Reports 5.2% Increase in Q3 Revenue
Pet Valu, a Canadian specialty retailer of pet food and pet-related supplies, reported system-wide sales were up 0.3 percent versus the year prior to $358.2 million during its third quarter, ended Sept. 28. Same-store sales growth was negative 2.5 percent, primarily driven by a 4.1 percent decrease in same-store transaction growth partially offset by a 1.7 percent increase in same-store average spend per transaction growth. Revenue was $276.0 million in Q3 2024, up 5.2 percent to $13.7 million, compared to $262.3 million in Q3 2023. The increase in revenue was mostly driven by growth in franchise and other revenues and partially offset by a decline in retail sales.
Technology & Internet
Amazon CEO Andy Jassy: 5-day office mandate isn’t a ‘backdoor layoff’
Amazon CEO Andy Jassy denied speculation that the company’s five-day in-office mandate was made to further reduce head count or appease city officials. “A number of people I’ve seen theorize that the reason we were doing this is a backdoor layoff or we made some sort of deal with the city, or cities, and that’s why we were having people come back and be together more often,” Jassy said at an all-hands meeting Tuesday, according to remarks obtained by CNBC. “I can tell you both of those are not true.” Amazon announced the new mandate in September. The company’s previous return-to-work stance required corporate workers to be in the office at least three days a week. Employees have until Jan. 2 to adhere to the new policy. “This was not a cost play for us,” Jassy said at the meeting, which coincided with Election Day. “This is very much about our culture and strengthening our culture.” At the time he announced the mandate, Jassy said that a return to the office full time would allow Amazon to be “better set up to invent, collaborate and be connected enough to each other and our culture to deliver the absolute best for customers and the business.”
Pinterest stock drops following weak Q4 guidance
Pinterest shares plunged as much as 15% on Thursday after the social media company provided soft guidance for its fourth-quarter revenue despite beating on the top and bottom lines with its third-quarter earnings. The company said fourth-quarter revenue will be between $1.125 billion and $1.145 billion. The midpoint of the fourth-quarter guidance, $1.135 billion, trailed analyst estimates of $1.143 billion. Pinterest CFO Julia Donnelly told analysts during an earnings call that ongoing weaknesses from food and beverage advertisers, which are part of the broader consumer packaged goods market, has negatively impacted the social media company’s overall sales. The slump by this sector will likely continue into the fourth quarter, she said. Sales in Pinterest’s third quarter rose 18% from $763.2 million a year ago. Pinterest said it had 537 million global monthly active users in the third quarter, topping analyst estimates of 532.6 million.
Finance & Economy
Federal Reserve cuts interest rates by 25 basis points
The Federal Reserve cut interest rates by a quarter percentage point, avoiding any surprises just days after the election of Donald Trump. The central bank voted unanimously on November 7th to cut its benchmark rate by 25 basis points to a new range of 4.5%-4.75%, making the decision at the conclusion of its two-day policy meeting in Washington, D.C. The move marks the second rate cut in seven weeks, following a jumbo half percentage point reduction in September that kicked off the Fed’s first easing cycle in more than four years. This new cut was justified, according to the Fed’s Federal Open Market Committee, as a way of supporting its dual mandate to maintain stable prices and maximize employment.
Mortgage rates rise again amid election volatility
Mortgage rates rose for a sixth consecutive week, following Treasury yields as they climbed higher through the presidential election. The average 30-year fixed-rate mortgage rose to 6.79% through November 6th, up from 6.72% a week earlier, according to Freddie Mac data. The average 15-year fixed-rate mortgage was essentially unchanged, to 6% from 5.99%. Mortgage rates typically mirror 10-year Treasury yields, which rose quickly in recent weeks as traders grew increasingly confident that former President Donald Trump would win the election and implement inflationary policies like tariffs.
Wall Street expects Trump presidency will unlock deal-making
Wall Street dealmakers and corporate leaders expect the flood gates to open on merger and acquisition activity after President-elect Donald Trump takes office in January. He’ll likely have congressional help. Trump defeated Democratic candidate Vice President Kamala Harris, and Republicans claimed a majority of the Senate in elections this week. That red wave is expected to spell loosening regulations on deal-making, with plenty of pent-up demand. “We know kind of where the world is headed in a Trump environment because we’ve seen it before,” said Jeffrey Solomon, president of TD Cowen, on CNBC’s “Money Movers” November 6th. “I think the regulatory environment will be much more conducive to economic growth. There will be lighter and targeted regulation.”
