markets

2/21/25

Celsius soars after announcing plan to buy Gen Z-focused competitor, shrugging off Q4 sales dip

Celsius Holdings, the energy drink brand beloved by celebrities and fitness influencers, is spiking in early trading after disclosing a $1.65 billion deal (net of tax assets) to acquire rival beverage maker Alani Nu.

Yesterday’s acquisition announcement came almost simultaneously with the company’s Q4 earnings, which revealed sales were down 4% year on year, better than analysts were forecasting, per Barron’s.

Since its Nasdaq debut in 2010, Celsius’ stock has been on a wild ride.

It was delisted from the Nasdaq at the end of that year, and while it returned in 2017, shares remained below $2 — until the company signed major distribution deals with beverage giants like AB InBev, Keurig Dr Pepper, and PepsiCo as consumers came around to its “healthier energy drink” marketing message. Since 2020, its revenues have grown more than tenfold, sending shares to an all-time high of ~$100 in March.

But, since peaking in May 2024, shares have plunged ~73%, wiping out over $16 billion in market cap as PepsiCo — Celsius’ primary US distributor — cut back orders to adjust inventory levels, triggering a 31% year-over-year revenue drop in Q3.

Acquiring the seven-year-old Alani Nu, which is popular among Gen Z and millennial women, might be the shot in the arm Celsius needs: in January, Alani Nu saw retail sales jump 78% from the previous year, according to Circana. Celsius expects the combination to drive the company’s revenue toward ~$2 billion (up from the $1.4 billion it pulled in alone in 2024), and boost its energy drink market share from 11% to 16%. Currently, Celsius holds the third spot in the $23 billion US energy drink market, trailing Red Bull and Monster.

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Western Digital Seagate Technology Rise to top of S&P 500

Data storage is so hot right now

A rapid turnaround in profitability helps explain how Seagate Technology and Western Digital have clawed to the top of S&P 500 this year.

Matt Phillips1h

markets

3h

Why Apple usually falls on a new iPhone launch

You can only shock the world so many times, and a thinner phone with a better camera isn’t always going to cut it.

That, in short, is why Apple has tended to go down on days when it’s introduced a new iPhone to the world, as this great chart from Bespoke Investment Group shows:

Bespoke iPhone announcement Apple performance — Source: Bespoke Investment Group

On average, the tech giant falls 0.4% on the release date and is negative more than 70% of the time, perhaps a useful tidbit on this, the day of the iPhone 17 launch.

One more thing....

A potentially complicating factor to the aforementioned data is that Apple has often done quite well in the six months leading up to a new iPhone announcement, roughly 5 percentage points better than its typical six-month return, as shown above. That’s not the case this time, with Apple shares up about 5% over the past six months compared to a typical near 20% advance in the prelude to a new iPhone drop.

So it’s not like expectations about how big of a catalyst this can be for the company are sky-high and due for a sharp retrenchment, especially given Apple’s relatively lackluster progress in developing AI capabilities relative to its megacap tech peers. But a seemingly low bar to clear hasn’t necessarily been a boon for the company on the big day, either.

In any event, staring too closely at the minutiae of all this may be missing the forest for the trees.

“While this info may be helpful to traders, we doubt it’s something that long-term shareholders are too worried about given the huge compounding returns the stock has provided during the iPhone era,” Bespoke wrote.

Negative US payroll revisions as bad as 2009 add to fears of consumer spending slowdown

Reconciling the spending versus jobs trends is the key question for US economic analysts.

Yellow traffic light against an office building

markets

5h

Planet Labs slips after big post-earnings gain

Smallish midcap satellite imagery and data company Planet Labs is giving back a chunk of the nearly 50% gain it racked up after posting earnings early Monday.

No tears, though: the shares, which seem to have a fairly robust retail following, are still up roughly 340% over the past 12 months.

Retail darling Planet Labs soars on earnings pop for second straight quarter

Retail darling Planet Labs soars on earnings pop for second straight quarter

markets

6h

CoreWeave soars as Microsoft’s deal with Nebius shows unrelenting demand for AI compute

CoreWeave is soaring as Microsoft’s $17.4 billion deal with Nebius shows the immense value and continued demand for all parts of the AI data center ecosystem.

One additional reason for CoreWeave’s jump may be that its pending acquisition of AI data center infrastructure company Core Scientific looks like a great deal compared to Microsoft’s renting of (more broad and advanced) AI data center capacity from Nebius.

CoreWeave’s all-stock deal to buy Core Scientific was initially valued at ~$9 billion, but with the subsequent decline in its shares, it’s worth about 40% less. And in purchasing Core Scientific, CoreWeave is saving $10 billion in what it would have paid the company to lease data center infrastructure over the next 12 years.

As it stands, Microsoft is getting about 300 megawatts in data center power capacity from Nebius, while Core Scientific boasts that its footprint is in excess of 1,300 megawatts. So, on the surface, it looks like an absolute steal for CoreWeave.

But again, this is not an apples-to-apples comparison; not all access to AI computing infrastructure is created equal.

There are differences in the type of AI infrastructure provided by the two: Nebius owns GPUs, while Core Scientific doesn’t, and what it provides in the software layer isn’t offered by Core Scientific as a stand-alone entity. This is the difference between the “full stack” approach (Nebius) and a “colocation” approach (Core Scientific).

That being said, CoreWeave’s acquisition of Core Scientific, once completed, will make the combined entity’s business model look more like Nebius’ model, which, as Microsoft just told us, is something that top hyperscalers are willing to pay a pretty penny for.

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