__Whip out the pint of gelato and romcom marathon...__ Tinder-owner __[Match](https://robinhood.com/stocks/mtch)__ is feeling the pain as __[Facebook's](https://robinhood.com/stocks/fb)__ dating feature [goes live](https://newsroom.fb.com/news/2019/09/facebook-dating/) in the US (just update your app and opt-in if you're looking to mingle). Technically, Facebook told us last year that this was coming, but here's the love story timeline.

- __1st date (fall 2018):__ Colombia. The magic begins when Facebook started testing in the land of Arepas.
- __1st trip (winter 2019)__ Latin America. Facebook expands the tests regionally to Mexico and Argentina.
- __1st fight (spring 2019)__ Feedback. Listening to early users, Facebook updates the feature to make it easier to set up a profile (and creepily proposes a pic for you).
- __Facebook makes it Facebook official (*today*):__ Another [19](https://twitter.com/mattnavarra/status/1169611360881324033) countries enjoy access, including the US (Europe waits 'till 2020).

__"If you're a bird, [I'm a bird](https://www.youtube.com/watch?v=EdwkSYsUvBs)"...__ The Facebook dating concept is that simple. Since Facebook knows what you like/click/join/share, Zuck thinks he can play match-maker better than Tinder. But the most unique feature we could find in our Snacks research is "Secret Crush":

- Facebook Dating defaults to __not matching you with friends,__ but there are 9 exceptions.
- If your sophomore Geography class partner is the one that got away, you can "Secret Crush" tag them.
- If they unknowingly reciprocate, Facebook makes the connection (warning: You get 9 "Secret Crushes" max).

Lovely

__Instagram is Facebook's surprise +1...__ That's what crushed Match. Match investors have known *for months* what Facebook was up to. What they didn't know was how much Facebook's *Insta* would be involved. Turns out Facebook integrates photos from Insta profiles into the dating feature. Since Instagram is where a whole generation's digital-selves obsessively live, FB Dating is now much more of a threat than Match expected.

Match drops 5% as Facebook Dating just happened

__*This isn't how I imagined my dream IPO*...__ According to [WSJ](https://www.wsj.com/articles/wework-parent-weighs-slashing-its-valuation-roughly-in-half-11567689174), __WeWork__ is thinking about dropping its valuation in order to IPO down to $20B-$30B. That's half of where it was. The last time WeWork raised money, its valuation reached $47B. This update is just a few weeks after it officially filed its IPO paperwork (aka "the S-1"). Here's what wounded the coworking unicorn:

- __What WeWork wanted:__ Investors to be sooo excited to own We stock that there would be *overdemand*, requiring an *increase* in the planned offer price.
- __What actually happened:__ The opposite. Powerful investors are telling WeWork the stock is too pricey, and nobody wants to buy at that price when it goes public soon.
- __The reason:__ Lack of transparency. The IPO paperwork WeWork issued last month didn't clarify key details about its (un)profitability. [One investor](https://finance.yahoo.com/news/weworks-ipo-filing-masterpiece-obfuscation-170920303.html) called WeWork's S-1 "a masterpiece of obfuscation."
- __The result:__ WeWork's reportedly dropping the price, basically putting its stock "on sale for 50% off" so investors can get comfortable enough to buy shares at the IPO. None of this is official yet.

Discount

__Tough day for WeWork shareholders (they already exist)...__ Even though WeWork hasn't IPO'd, its employees, early investors, and venture capitalists already own shares (some as compensation for work). Now the stock could be worth 1/2 what We was hoping for. WeWork's valuation got (very) high as a private company, so when shares hit the public market (and anyone can buy them) their price could come down to reality.

WeWork plans to massively devalue itself to save the IPO

Dow Jones

S&P 500

Nasdaq

Bitcoin

10-Yr US Treasury

_"It's just Instagram. Your Tinder profile will be fine."_

Instagram's 1st date

__The force isn't as strong with this one...__ __[Slack's](https://robinhood.com/stocks/WORK)__ mission to destroy email with zippy messaging had a rough quarter. 100K companies pay Slack to manage non-verbal inter-office messaging and only 5K came on board in the last 3 months. That's [slower growth](https://www.cnbc.com/2019/09/04/slack-work-earnings-q2-2020.html), so shares tanked 14% on its 1st earnings since going public in June.

__It's very much unprofitable...__ but it's profitably dominating your life. The average Slack user is actively slacking [90 minutes per day](https://s23.q4cdn.com/371616720/files/doc_financials/2019/Q2/Updated/Earnings-Graphs-9.04.19_V11.pdf) and has it open for 9 hours of work/life imbalance. Here's why growth lost its mojo: 

- __#spent-less-on-advertising__ — Slack hoped its growth momentum was unstoppable, but it still needs to buy ads.
- __#low-hanging-fruit-is-gone__ — Early adopters have Slacked for years. To get less adventurous white collars, it needs to work harder training users on how to quote (use ~ tildes ~) and start a :thread:.

Debut

__For Slack to win, Microsoft must lose...__ Microsoft is the Tyrian Lannister of software (it thinks and it knows things). It finds ways to survive. It owns office email with Outlook, and is adapting with "Teams," a nimble messaging service that mimics Slack's qualities. Microsoft's Slack competitor is an easier sell to Larry-from-procurement, who's been Microsoft-loyal for decades. Plus, Teams is sneakily bigger: 13M daily users to Slack's 10M.

FYI: [This NYT guide](https://www.nytimes.com/2019/08/28/smarter-living/how-to-stop-slack-from-taking-over-your-life.html?fallback=0&recId=1QP79LRMzCAhEBn9ep0aITZKzDo&locked=0&geoContinent=NA&geoRegion=VA&recAlloc=random&geoCountry=US&blockId=home-living-vi&imp_id=82546538) to stopping Slack from taking over your life.

Slack's quest to kill Outlook email hits a speed bump

__Abercrombie's little cousin...__ __[American Eagle](https://robinhood.com/stocks/aeo)__ doesn't fill its stores with cologne and abs — Instead, the retailer is [adding](https://www.cnbc.com/2019/09/04/american-eagle-to-launch-beauty-business-before-the-holiday-season.html) CBD-infused lotions to its button-downs next month. In the meantime, shares plummeted 12% Wednesday because of the following contradiction in last quarter's performance:

- ⬇️1% = __American Eagle's__ sales fell — blame weak back-to-school sales in July.
- ⬆️16% = __Aerie__ sales surged — American Eagle's lingerie brand saw *its 19th-straight quarter of double-digit growth*. Let that sink in.

__Bralettes experienced "renewed excitement"...__ American Eagle's [words](https://seekingalpha.com/article/4289636-american-eagle-outfitters-inc-aeo-ceo-jay-schottenstein-q2-2019-results-earnings-call?part=single). It's talking about its Aerie brand's signature anti-push-up bra. Aerie's Photoshop-less models are ([actually](https://fashionista.com/2019/09/fashionista-five-jennifer-foyle-profile)) stealing market share from Victoria's Secret's ultra-sexualized ones. Now AE is opening 40 standalone Aerie stores and expanding the brand from underwear to yoga pants.

Worn

__Spinoff brands are the new black...__ While American Eagle's style stays grounded, its Aerie line has taken off. These spinoff brands let the parent brand catch trends, try-on new looks, take risks, and scare corporate. But your Snacks team is noticing key apparel spinoff brands outpacing their parents. Check your closet for examples:

- __Madewell__ has [outperformed](https://www.vox.com/the-goods/2019/4/12/18307911/jcrew-madewell-ipo-brand-spinoff) owner __J. Crew__ for years.
- __Anthropologie__ [out-dresses](https://www.businessinsider.com/urban-outfitters-vs-anthropologie-comparison-which-clothing-store-is-better-2019-6) and out-grows __[Urban Outfitters](https://robinhood.com/stocks/URBN)__.
- __Old Navy__ performed so well that __[Gap](https://robinhood.com/stocks/GPS)__ had to [spin off](https://www.nytimes.com/2019/02/28/business/gap-old-navy-spinoff.html) its spinoff brand into a separate publicly traded company.


Aerie's bralettes are saving its parent company: American Eagle

_American Eagle's "aha" moment_

American Eagle is now a bralette company

__#AnxiouslyWaitingForLikes...__ Been there. *You post a pic of you and that friend — or worse — a pic of just you. After 5 minutes you've got 2 likes. After 10, 6. After an hour, 14. DELETE POST.* The like-struggle is real. __[Facebook](https://robinhood.com/stocks/FB)__ is aware and just confirmed its test to remove the number of a post's social media affirmations from public view.

__Side hustle...__ Jane Manchun Wong enjoys one as a "reverse engineer" — while you're reading Snacks, she's mining code, searching for deep-app irregularities. We'll let her describe what happened next in [her own words](https://wongmjane.com/blog/fb-hiding-likes): 

- "*I observed that Facebook has recently begun prototyping this hidden like/reaction count feature in their Android app by reverse-engineering the app and playing with the code underneath.*"

Facebook [confirmed](https://techcrunch.com/2019/09/02/facebook-hidden-likes/) it's testing a way to hide the likes from your followers/friends, *but still showing you*. Letting go 100% is hard.

Testing

__This is a classic cost-benefit analysis...__ It's testing to see how users react first before it makes the thumbs-up invisible. The cons could hit Facebook's bottom line (less user engagement and potentially ad revenue), the pros are mostly for society (less anxiety). But Facebook could win valuable PR points if it makes the right decision — just as it separately faces political tech-lash over its privacy problems and anti-competitive size.

A side-hustler reveals Facebook's test to hide your "likes"

__Toothpaste or teeth-whitening?...__ Both. Last week, __[Walmart](https://robinhood.com/stocks/wmt)__ sneakily [updated](https://www.businessinsider.com/walmart-testing-health-clinic-in-georgia-with-counseling-dentistry-2019-8) its website to reveal it wants to be a doctor when it grows up: Starting September 13th, a Georgia location will add medical services. This week, Earth's biggest retailer is taking a fresh stand: *guns*. Big one. Here's what's in and what's out:

- __Out:__ Walmart will stop selling handgun ammunition nationwide or any handguns in Alaska (the last state where it still does that). And it's politely requesting shoppers not openly-carry guns in its 4,700 stores.
- __In:__ Walmart's still selling deer rifles and shotguns. 

__"The status quo is unacceptable..."__ — Walmart CEO [Doug McMillon](https://corporate.walmart.com/newsroom/2019/09/03/mcmillon-to-associates-our-next-steps-in-response-to-the-tragedies-in-el-paso-and-southaven). Both he and Walmart's founder were avid hunters. Plus, the chain enjoys 20% of all US ammo sales. Now he's expecting these policies to drop that market share to 6%. Two recent shootings within Walmart stores pushed these moves — here's how they fit in:

- __1990s:__ Walmart stops selling handguns south of Alaska.
- __2015:__ Stops selling assault-style rifles.
- __2018:__ Raises minimum gun-buying age to 21.
- __Last month:__ Yanks violent video game displays.

Recalibrate

__Corporate policies > Government policies...__ (lately). Investors have been [rewarding](https://www.fastcompany.com/90388604/politically-active-ceos-and-jobseekers) companies that jump into political issues where consumers crave government action, but aren't getting it. Picture Nike with social issues, Starbucks with employee pay, or private Patagonia on the environment. Walmart saw gun standards as its "[responsibility](https://www.cnn.com/2019/09/03/business/walmart-ends-handgun-ammo-sales/index.html)" — now it's even sending letters to Congress to follow.

Walmart's new arithmetic: add dentists/therapists, subtract guns/ammo

_Waking up in a like-free Instaworld_

Facebook tests the end of the like 👍

__Therapy in aisle 6...__ __[Walmart's](https://robinhood.com/stocks/wmt)__ making it happen. The chain subtly updated its website last week to include hearing, vision, dentistry, and mental health services for $59-$99. The pilot stealthily starts on September 13th at one Georgia location as Walmart [tests](https://www.cnbc.com/2019/08/29/walmart-is-piloting-health-clinic-at-walmart-health-in-georgia.html) the concept. With 140M American visitors every week and 1.5M employees, it could actually democratize doctor access like it did tube socks.

__"Peloton sells happiness."...__ The privately-held workout-tech unicorn [stuck that](https://www.sec.gov/Archives/edgar/data/1639825/000119312519230923/d738839ds1.htm) in its IPO paperwork as it plans to go public. __Peloton__ makes nearly 80% of its money from selling $2K bikes or $4K treadmills — the rest rolls in from $39 monthly video subscriptions to its streaming fitness classes. It lost $196M last year, but we were impressed by the loyalty of the 500K+ Pelotonistas: Only 0.65% of customers end their subscription each month.

Highs

Who's up...

__Spend money to make money...__ __[Citigroup](https://robinhood.com/stocks/C)__ raised its [minimum wage](https://www.cnn.com/2019/08/28/business/citigroup-minimum-wage/index.html#targetText=A%20Citi%20spokesman%20told%20CNN,that%20was%20made%20public%20Tuesday.) in the US to $15/hour. It's not doing it for smiles — with an ultra-competitive market for workers, it's upping paychecks to keep tellers from ditching for __[Bank of America](https://robinhood.com/stocks/BAC)__ (which pays $20/hour). We also learned that __Panera Bread__ has 100% worker [turnover](https://www.cnbc.com/2019/08/29/fast-food-restaurants-in-america-are-losing-100percent-of-workers-every-year.html) — if it hired 100 sandwich-crafters, it'll lose 100 by the end of the year. Promotions cost money. Losing a worker costs more.

__Your new farm-raised almond butter routine...__ is killing your childhood peanut butter go-to. __[Smucker's](https://robinhood.com/stocks/sjm)__ sales dropped 6% as grocery stores are stuck cutting peanut butter prices. The 122-year-old master of jelly, Jif, and UnCrustables (picture a PB&J dumpling) [claims](https://www.wsj.com/articles/smucker-shares-fall-but-consumer-staples-are-poised-to-bounce-11566930349?mod=lead_feature_below_a_pos1) grocers face 2 problems: price pressure from Walmart/Amazon  and taste buds preferring alt-nuts over peanuts.

Lows

...and who's down

__2 dollar store companies, 30K American locations...__ Stocks of dollar chains are living their best lives. Dollar General's CEO put it [best](https://www.axios.com/rural-america-dollar-stores-retail-recession-grocery-51054373-38f8-45fd-b088-9ab0dd00aba3.html): "*The economy is continuing to create more of our core customer.* " While rising American inequality's been great for his business, the trade war hasn't. Then last week happened: 

- __[Dollar Tree](https://robinhood.com/stocks/DLTR)__ stock popped 5%.
- __[Dollar General](https://robinhood.com/stocks/DG)__ stock surged 13%.

__Red pill or blue pill?...__ Imports from China made dollar stores possible. But Trump's latest tariffs (a 15% tax on $110B of Chinese goods) just kicked in Sunday. That left dollar store managers with 2 options: raise prices by 15% (make customers pay) or don't raise prices (pay the tariffs themselves). But they twisted into 3 [way more creative](https://www.marketwatch.com/story/dollar-general-pvh-other-retailers-adjust-their-outlooks-to-soften-the-blow-of-tariffs-2019-08-29) options:

1. __Find the same products made in other countries:__ If your Solo cups are made in China, find Solo cups made in Vietnam.
2. __Find just-as-good products (aka "substitutes"):__ Paper cups should do just fine. Source ones crafted in the US instead. 
3. __Make someone else pay them (aka "negotiate"):__ Try to get the Chinese Solo cup company to reduce prices by 15%.

Avoid

__Dollar stores get a "10" for dodge-ability...__ Those 3 tricks above didn't completely offset trade war pain, but Wall Street is pumped that they're adjusting well. Other retailers aren't as nimble. Picture shoe, apparel, and electronics companies — you can't just up and move a Nike, Ralph Lauren, or GoPro factory. And Abercrombie can't start stocking American Eagle henleys to avoid tariffs (the teens will notice). 

How to not pay for tariffs: Dodge 'em (Dollar Stores figured it out)

_To dodge a tariff, channel your inner Neo_

How to avoid tariffs like Keanu

__Now batting, for the New York Yankees...__ Jeff Bezos. In one of the final chapters of the Disney-acquires-Fox saga, __[Disney](https://robinhood.com/stocks/DIS)__ officially [sold](https://www.geekwire.com/2019/amazon-joins-ownership-group-yes-network-tech-giant-moves-sports-media/) the YES Network Thursday to the NY Yankees, Sinclair Broadcast Group, __[Amazon](https://robinhood.com/stocks/AMZN)__, and some other investors. Here's what they're buying:

- YES is __the TV channel__ with rights to broadcast the Yankees, Brooklyn Nets, NY Liberty, and NYC FC teams.
- And __it's worth $3.7B__ because New York sports have global appeal despite local frustration.

__This Disney & Fox deal goes way back to 2017...__ That's when Mickey started a bidding war against Comcast to acquire 21st Century Fox, which included X-Men, Fantastic Four, The Simpsons, Avatar, 22 regional sports networks, and the YES Network. The Justice Department allowed the merger on 1 big condition:

- __The requirement:__ Disney can add all those big names, but only if it [sells](https://www.justice.gov/opa/pr/walt-disney-company-required-divest-twenty-two-regional-sports-networks-order-complete) the sports channels and YES — otherwise it would have too much media power.
- *__Sports translation:__ LeBron and Kobe can be on the same team, but only if they trade away Steph to another one.*

_When Amazon buys a sports channel_

Bundled

__Amazon's now the proud 15% owner of YES Network...__ It hasn't said what it will do with that — But we're all hoping for the Yankees to be a #PrimePerk. Amazon Prime Video has already done deals with the NFL's Thursday Night Football and the Premier League. CEO Bezos won't offer up details yet, but it's already generating HQ2-style speculation.

Disney sells YES Network to the Yankees, Sinclair, and *Amazon*

__Because you need that fall transitional cropped sweater ASAP...__ "fast fashion" became a thing: it's the art of catching new trends and pumping out styles quick with efficient supply chains — and the big 3 have been __H&M__, __Zara__, and __Forever 21__. Now Forever 21 and its satin belted 800 stores are [reportedly](https://www.cnn.com/2019/08/29/business/forever-21-bankruptcy-trnd/index.html) filing for bankruptcy.

__Travel back to 1984...__ Mock turtlenecks were in and a South Korean immigrant couple with $11K founded a store in LA committed to chambray, bomber jackets, and anything that had staying potential (fyi, Forever 21 is still private — you can't buy the stock). That fast fashion trend it rode hit a peak this decade, but now the leaders are feeling pains. Fast.

- __H&M__ lost half its market value in just the last 5 years — and it's stuck with $4.3B in unsold clothes, some of which [it burns](https://www.nytimes.com/2018/03/27/business/hm-clothes-stock-sales.html) to get rid of.
- __Zara__ just [missed](https://fortune.com/2019/08/11/hm-zara-store-closing/) full-year earnings expectations.
- *Fast fashion has now faced the f-word: "Fad" — it's become one.*

Strut

__Fast Fashion's losing to its opposite...__ *sustainable fashion*. Sure, Forever 21 is also dependent on physical stores and malls that are struggling — but overall, the *used* fashion industry is now suddenly expected to [pass](https://www.cnbc.com/2019/03/19/fashion-retailers-under-threat-from-24-billion-second-hand-market.html) the *fast* fashion one within a decade. Here's who's out-dressing fast fashion:

- __Rent the Runway__ literally rents you daily clothes now (not just fancy wedding weekend gowns).
- __[Urban Outfitters](https://robinhood.com/stocks/urbn)__ launched its own rental copycat look.
- __[Stitch Fix](https://robinhood.com/stocks/sfix)__ sends monthly boxes and uses AI to better tell what you'll actually like (and not waste).
- __[TheRealReal](https://robinhood.com/stocks/real)__ IPO'd this year committed to reusing and reselling that authentic Gucci getup so it doesn't end up in a landfill.

Forever 21 may declare bankruptcy — and the end of fast fashion

__Free bread's not enough...__ The CFO of __Panera__ told [CNBC](https://www.cnbc.com/2019/08/29/fast-food-restaurants-in-america-are-losing-100percent-of-workers-every-year.html) that he's suffering through 100% employee turnover every year. With [100K](https://www.businessinsider.com/panera-bread-employees-facts-2018-7) employees, this stat means the carbo-loaded chain needs to hire 100K people every year because about 100K quit every year. Let that sink in. And get this:

- The __"turnover rate"__ is even higher in the rest of fast food — up to 150%.
- That means __more than 1 person quits__ from the same position each year, and the company just has to keep on rehiring.

__Different industry, same problem...__ To keep employees from leaving, __[Citigroup](https://robinhood.com/stocks/C)__ just increased its minimum wage to $15/hour, finally catching up with __[Wells Fargo](https://robinhood.com/stocks/WFC)__ ($15/hour), but still trailing __[JP Morgan](https://robinhood.com/stocks/JPM)__ ($15-18) and __[Bank of America](https://robinhood.com/stocks/BAC)__ ($20). 

- High turnover is driven by __our ridiculously low unemployment rate (3.7%)__ that puts workers in high demand, more able to switch jobs and make more money.
- The response is to __do nothing or pay more__ to preempt a cook from bouncing to Chipotle for an extra buck or two an hour.

__Companies can *save* money by paying workers more...__ To replace a Panera employee, it has to hire (+ paperwork/interviews), train (that takes time), and wait until the worker is actually good (many mis-flipped eggs later). Paying more could prevent those costs by keeping workers around. But wages are still [not growing fast](https://www.nytimes.com/2019/05/02/business/economy/wage-growth-economy.html) on average, forcing some states to push minimum wage increases.

Citibank & Panera Bread: 2 stories show minimum wage is having a moment

Amazon snags 15% of the Yankees (network)

__Pranks just got harder...__ Over 400 police departments ([these ones](https://blog.ring.com/2019/08/28/working-together-for-safer-neighborhoods-introducing-the-neighbors-active-law-enforcement-map/)) can now ask __Ring__ security camera owners for help cracking a crime. __[Amazon](https://robinhood.com/stocks/amzn)__ acquired Ring last year for $800M, then connected the doorbell-camera security startup to its own Neighbors app — Now Ring shows you, or the police, who's knocking.

__Don't panic...__ You've got to opt in first. But here's how it goes down. The Neighbors app lets Ring-owners open up the video feed of their front stoop for all to see. Then "neighbors" (as Amazon calls the users) could get this request from local police: "*There was a burglary this morning on 240 Spruce Street — you got video footage?*" Got Ring? You might.

Watch

__Nearly every new tech product has a privacy issue...__ Amazon made phone-connected home security a scalable thing — Ring became a Prime Day [bestseller](https://www.vox.com/recode/2019/7/16/20695008/amazon-ring-prime-day-fear-social-media). Now catching package thieves in the act is the next reality TV hit. But Ring's relentlessly un-blinking 24/7 footage is just another front in the tech privacy battles:

- __The customer benefit:__ Protect your home, your neighborhood, and help the police catch "the [Wet Bandits](https://homealone.fandom.com/wiki/Wet_Bandits)."
- __The social downside:__ Record your unwitting neighbors, potentially start over-reporting unsuspicious activity, and possibly get your feed hacked into. 

Amazon's Ring security cameras team up with 400 police departments

__Manning vs. Brady. Jordan vs. Kobe...__ __[Fitbit](https://robinhood.com/stocks/fit)__ vs. __[Apple](https://robinhood.com/stocks/aapl)__. Fitbit's only product competes with the iPhone maker's 4th most important product (Apple Watch). But the fitness tracker pioneer just [announced](https://www.cnet.com/news/fitbit-has-a-new-versa-2-smartwatch-with-alexa-a-new-premium-health-service/) Fitbit *Premium* — the new subscription concept hopes to more money every month off users who already paid for a Fitbit. It's a trick out of Apple's book.

__Put me in, coach...__ For $10/month, your fitness tracker will crunch some artificial intelligence and tell you what to do — it analyzes your activity, diagnoses your "problems," then guilts you into changing with "solutions." And it's got a menu of 9 health programs to choose from, like "Healthy Habits" or "Get More Zzz's." Think of it like this:

- __Your old Fitbit wearable:__ It just showed that you only did 683 steps today. That's it. It counted.
- __The new Fitbit Premium service:__ Nudges you to go for an 18-minute walk at 2pm since you haven't moved in hours. Then it "encourages" you to join a 30-minute mindfulness course to clear your head before dinner.

Sweat

__Are we at #SubscriptionSaturation?...__ Add "digital AI health assistant" to the list of things you're coughing up $10 monthly for. On top of your Netflix, Spotify, and Blue Apron subscriptions, Fitbit's adding to the subscription-obsessed tech-meets-wellness trend we're seeing elsewhere:

- __Fitness:__ Peloton's about to IPO, charging $39/month just for videos of spin classes. And OG gyms do the same thing (physical gyms matter, too).
- __Wellness:__ Calm and Headspace [charge](https://snacks.robinhood.com/newsletters/I8ABCDal2o99W3TesGSBI/articles/3ziQ103JRMSgNbg05BPe1F/) $60 and $96 per year for meditation audio. Like podcasts, but for your deep brain.

Fitbit snags a trick from Apple: Premium Subscription

"_This is nothing — I just installed an Amazon Ring at my condo_"

Amazon Ring is the new neighborhood watch

__Founded by a New Yorker annoyed by sold-out spin classes...__ Now __Peloton__ is almost a publicly traded stock. The at-home fitness company trying to crush gyms (and hammies) just revealed its S-1 — that's the tell-all document every company must issue before its IPO (read the thing [here](https://www.sec.gov/Archives/edgar/data/1639825/000119312519230923/d738839ds1.htm)). The highlight was the numbers:

- Bike-powered revenues [were](https://www.cnn.com/2019/08/27/tech/peloton-ipo-filing/index.html) __$915M__ last year.
- But costs were way more — especially the marketing splurge on those Jay-Z [soundtracked](https://www.ispot.tv/ad/dfnS/peloton-on-to-the-next-song-by-jay-z) commercials, leading to a loss of __$196M__.

__For thousands of $$$, Peloton instructors will yell at you...__ from the comfort of your own basement. Here's the value prop, which has converted 613K spinners to become Pelotonians/Pelotonistas.

- __Really expensive equipment:__ A $2,245 indoor bike or a $4,295 treadmill, both with HD touchscreens. Perfect reach wedding registry item.
- __Pricey monthly subscription:__ $39/month for streaming fitness classes, taught by super fit, probably good-looking instructors with Instagram-toned muscles.
- __Once a Pelotoner, always a Pelotoner:__ Only 0.65% of its monthly subscribers cancel each month. That's loyalty.

_The plot for Peloton's IPO, in 1 picture_

Reveal

__This is all the trends in one hill climb...__ Peloton thinks  there are enough high-income earners craving abs *and* time by exercising at home. That's earned it a $4B valuation in the private market. Once it IPOs, regular investors have a chance to own shares of this Franken-monster of business models. Here's what Peloton's like:

- __Netflix:__ Peloton is a media company with a library of original content.
- __Apple:__ Peloton makes beautifully-designed hardware that's top-shelf price.
- __Casper:__ Peloton sells directly to consumers, with 74 of its own retail showrooms.

Peloton takes off its bike shorts to show off its pre-IPO financials

__Second time's a charm...__ __[Altria](https://robinhood.com/stocks/MO)__ and __[Philip Morris International](https://robinhood.com/stocks/PM)__ both sell Marlboro cigarettes. Altria's got dibs on the US market and Philip covers the rest of the world. They used to be the same company, then they split, now they confirmed they're trying to merge again. Here's the relationship timeline.

- __1998:__ The tobacco companies settled with 46 states plus DC for [$246B](https://www.npr.org/2013/10/13/233449505/15-years-later-where-did-all-the-cigarette-money-go) for the health damages they helped create. That's. A lot. Of money.
- __2008:__ Fearing another lawsuit, Altria split off Philip and gave it a foreign passport — that shielded PMI from American lawsuits and anti-smoking legislation.
- __Now:__ With tobacco sales [declining](https://www.wsj.com/articles/philip-morris-altria-discussing-all-stock-merger-of-equals-11566913969) globally (except some developing markets) the two want to move back in to save money. Picture that couple paying $2K each for studios in TriBeCa. Shares fell for both companies on the uninspiring news that it's just a practical move.

Rekindle

__Tobacco's not even worth suing anymore...__ Health worries had already crushed cigarette growth — now existing smokers are gravitating toward e-cigs and cannabis.

- Altria's sales are 35% lower than ten years ago.
- PMI's have dropped 10% over the same decade.


Altria and Philip Morris hope to light back up together in cigarette love

__Need milk...__ __[J. M. Smucker](https://robinhood.com/stocks/sjm)__ dropped 8%, making it the worst-performing stock in the S&P 500 yesterday. The 4-generation, 122-year-old company is grumpy about 1 product: peanut butter.

__"Choosy moms choose Jif"...__ Now they choose humanely-raised alt-nut options. Sales of peanut butter and Smucker's other headline jam/jelly/butter foods fell 6% last quarter — the company is blaming grocery stores, which are cutting PB prices. But those retailers are discounting for 2 reasons:

1. __Gotta compete:__ With Amazon pushing harder into food and Walmart already America's biggest grocer, grocery stores are slashing prices to keep win customers. 
1. __The rise of the anti-peanut butters:__ Almond. Macadamia. Cashew with a little cinnamon swirl. More expensive fancy butters are [encroaching](https://www.reuters.com/brandfeatures/venture-capital/article?id=82896) on peanut butter's bread real estate.

"_Stay with me until the next earnings report, Strawberry!_"

Jammin'

__We need to redefine food “staples”...__ A staple = *“Eaten routinely and in such quantities that it constitutes a dominant portion of a standard diet.”* Peanut butter has always been one. And Jif was the staple food's staple brand. But as consumers upgrade their spreads and retailers downgrade prices,  old school "staples" like Jif are losing their staple "status."

Peanut butter price drop hits Smucker's hard

Peloton is Netflix, Apple, and Casper all in one

__Take one and call us in the morning...__ Mega drug company __[Johnson & Johnson](https://robinhood.com/stocks/jnj)__ was handed a verdict by an Oklahoma judge: *pay the good people of the state $572M for what you did*. 

- __The crime:__ J&J was over-selling Oklahomans about the application of its prescription pain medications and under-warning about the risk of addiction. 
- __The damage:__ In 2015, 326M opioid pills were prescribed in the state — that's enough for each adult to have 110 pills. And [6K died](https://www.npr.org/sections/health-shots/2019/08/26/754481268/judge-in-opioid-trial-rules-johnson-johnson-must-pay-oklahoma-572-million) from overdoses since 2000.
- __The penalty:__ $572M. But it's way less than the $17.5B the state's Attorney General pushed for.

__It's over for J&J in Oklahoma...__ But the legal tour goes on. Next is Cleveland, where a bunch of drugmakers and distributors suit up for another courtroom trial. J&J investors were pleased about the smaller-than-expected dent in the company's bank account — shares rose 3% despite the half-a-billion dollar fine.  

Judged

__Dirty corporate deeds will chase you for years...__ Johnson & Johnson's exited many of its opioid-dealing businesses. But its drug marketing has left huge emotional and physical wounds — these cases call it a "public nuisance" — which are now facing lawsuits in civil court. Fyi, over 2K other opioid cases remain.

The 1st big corporate opioid lawsuit: Johnson & Johnson got off not too bad

__New play-date for the Power Rangers...__ This one's with [Peppa Pig](https://www.peppapig.com/), the British kids show featuring alliteration-enabled animal characters. Toy icon __[Hasbro](https://robinhood.com/stocks/has)__ will is paying $4B for the company behind the cartoon, __Entertainment One__. Fun side fact: In addition to Peppa, Entertainment One also owns Death Row Records, the production company behind Dr. Dre.

__Peppa's got a passport for China...__ (stamped regularly). The Blues Clues-meets-Mary Poppins character is translated into 40 languages. But to Hasbro, she's a "Beachhead to go into China for many years to come.”

- She's been in China since the mid 2000s — and was temporarily [banned](https://www.independent.co.uk/news/world/asia/peppa-pig-ban-china-childrens-tv-cartoon-gangster-douyin-a8332846.html) once for "promoting gangster attitudes."
- Now she's [loved](https://www.npr.org/sections/goatsandsoda/2019/02/05/691501906/why-its-the-year-of-peppa-pig-in-china) by the People's Liberation Army (they do these military formations in the cartoon's honor).
- And she's got a spot on China Central Television (that's the state-owned channel).

Play

__"Disneyfication" is the future of entertainment...__ Hasb-rival __[Mattel](https://robinhood.com/stocks/MAT)__ is transforming Barbie from toy-to-franchise with her own real-life [movie](https://variety.com/2019/scene/news/margot-robbie-on-playing-barbie-it-is-a-great-opportunity-to-put-some-positivity-out-in-the-world-1203276988/) starring Margot Robbie. Hasbro wants a similar profit ecosystem with Peppa. But Hasbro stock had fallen as investors weighed the hefty price tag for the strategy — turns out __[Disney](https://robinhood.com/stocks/DIS)__ paid the same sum to get Star Wars back in 2012 as Hasbro splurged for Peppa.

Hasbro drops $4B on a kids TV program (and it got some rappers)

__Movie night! (*Unless it rains*)...__ That's the reality for '80s babies who grew up with a satellite dish. __[Dish Network's](https://robinhood.com/stocks/DISH)__ stock just enjoyed a "buy" [recommendation](https://www.cnbc.com/2019/08/26/dish-shares-climb-after-analyst-declares-an-opportune-time-to-buy.html) from a Wall Street analyst — only a month after it was hit with a "sell" recommendation. That made us want to sit down, kick off our shoes, and take a look at the satellite OG.

__While you were enjoying *Clueless* on Netflix...__ Dish Network realized it needed a makeover. 

- __The old Dish = *Pay TV*:__ It literally owns satellites that orbit the earth, sending signals to the dish jiggered to grandpa's garage. That biz has shrunk for years from cord-cutting.
- __The new Dish = *Wireless*:__ It's gearing up to launch 5G service for the Internet of Things ➡️ Connect your appliances so they buzz your phone when the wash cycle finishes. Dish is also acquiring Boost Mobile as part of the Sprint/T-Mobile merger.

Redefine

__Pay TV companies are evolving gorgeously fast...__ Just look at __[AT&T](https://robinhood.com/stocks/T)__: it's evolved from its landline past, acquired Time Warner, now owns HBO, and is going big on wireless and streaming. Telecom companies are becoming media giants. Dish hopes to Metamorphosize as gracefully, but hasn't quite yet. It's still almost 100% dependent on pay TV revenue because it's mid-makeover.

Dish Network faces mixed Wall Street reviews during its transformation

"_You're telling me I'm fined $572M, and my stock price increased?_"

The 1st corporate opioid verdict

__Retail-pocalypse survivor = Target...__ Shares surged 17% for Minnesota's pride-and-joy because its $7B Millennial makeover is winning — __[Target](https://robinhood.com/stocks/tgt)__ has remodeled 500 locations and just [unveiled](https://www.cnbc.com/2019/08/23/target-opens-100-mini-stores-remodels-500-bigger-ones.html) its 100th mini-store, where sales are actually rising. It [also launched](https://www.eater.com/2019/8/19/20812094/target-store-good-and-gather-grocery-food-brand) its biggest ever food brand, Good & Gather, which is smothered in organic-ness.

__5.6M wrists...__ __[Fitbit](https://robinhood.com/stocks/fit)__ just snagged them via a [big new client](https://www.forbes.com/sites/jamessomauroo/2019/08/22/fitbit-partners-with-singapore-government-to-offer-trackers-to-56m-people/#197dd03b2031): the government of Singapore wants its citizens wearing quasi-cool fitness trackers for a nationwide public health initiative. Sales for Fitbit's "health solutions", through partnerships like this, have jumped 42% from last year.

__11...__ That's how many times __[Estée Lauder](https://robinhood.com/stocks/el)__ dropped the term "travel retail" in [its latest](https://media.elcompanies.com/files/e/estee-lauder-companies/universal/investors/earnings-and-financials/quarterly-earnings/2019/q4/q4-fiscal-2019-earnings-release.pdf) earnings report. The makeup legend is squeezing splurge-cash from captive audiences stuck in airport terminals. The trend isn't limited to just EL's makeup and skincare sales — spending overall at airports tripled over 15 years, hitting $69B in 2017.

__New card, who dis?…__ __[Apple’s](https://robinhood.com/stocks/aapl)__ digital-first credit card with __[Goldman Sachs](https://robinhood.com/stocks/gs)__ went [live](https://www.apple.com/newsroom/2019/08/apple-card-launches-today-for-all-us-customers/.) nationwide to everyone with iPhones. Apple’s proud of its hoverability (you don't "swipe" your iPhone), privacy (the number changes with each transaction), and rando-coolness (it turns colors based on your purchase). But Apple's most innovative creation since AirPods couldn’t save the stock from the trade war cross-fire — nearly all Apple hardware is made in China.

__Fewer angel sightings...__ More bralettes and inclusive sizing. __Victoria's Secret__ missed that trend — and shares of its owner __[L Brands](https://robinhood.com/stocks/lb)__ plummeted to a [10-year low](https://www.cnbc.com/2019/08/22/victorias-secret-parent-l-brands-shares-tank-touch-near-10-year-low.html) after the lingerie icon's sales fell another 6% last quarter. The Chief Marketing Officer behind its push-up culture is out after 30 years and the company will stop broadcasting its fashion show.

__Propagandists ❤️ [Twitter](https://robinhood.com/stocks/TWTR), [Facebook](https://robinhood.com/stocks/FB), and [Google](https://robinhood.com/stocks/GOOG)...__ As activists in Hong Kong protest for more democracy, Chinese authorities started buying ads online. And posting a lot of [false details](https://www.reuters.com/article/us-hongkong-protests-twitter/twitter-discloses-china-backed-interference-in-hong-kong-protests-idUSKCN1V91NX). The social media platforms acted to crush the state-sponsored disinformation — a reminder to investors that online ads are good for mattress companies that want to sell to you... and dishonest governments that want to mislead you.

__If you snoozed news Friday...__ you missed a 24-hour drama of Twitter squabbling and real economic punching that unfolded in 4 parts: 

1. 🇨🇳 🤜 🇺🇸 __China__ announced it was increasing tariffs on a hefty $75B worth of stuff it buys from the US every year (including cars).
2. 🇺🇸 🤜 🇺🇸 __President Trump__ [wondered](https://twitter.com/realdonaldtrump/status/1164914610836783104) aloud on Twitter who was a bigger enemy to the US: China's President Xi or the Chairman of the Fed, Jerry Powell.
3. 🇺🇸 🤜 🇨🇳 🇺🇸 __Trump__ ordered US companies to start the process of removing production from China.
4. 🇺🇸 🤜 🇨🇳 __Trump__ increased all existing and planned tariffs on China by 5%.  

__As always with tariffs, there are plenty of losers...__

- __Cars:__ Besides Americans, China buys the 2nd-most US-made cars. Tariffs are like a tax raise on __[Tesla](https://robinhood.com/stocks/TSLA)__ (-5%), __[Ford](https://robinhood.com/stocks/F)__ (-3%), and __[BMW](https://robinhood.com/stocks/BMWYY)__ (-3% — the Carolina-made X5 is the #1 exported car in America, going mostly to China).
- __Toys:__ __[Mattel](https://robinhood.com/stocks/MAT)__ fell 7% because most of Barbie is made in China.
- __Electronics:__ Entertainment staples __[Best Buy](https://robinhood.com/stocks/BBY)__, __[Apple](https://robinhood.com/stocks/AAPL)__, and __[GoPro](https://robinhood.com/stocks/GPRO)__ were destined for punishment after producing in China.
- __Everything else:__ Tariffs will look to us like price increases on the stuff we buy, which JP Morgan [estimates](https://www.cnbc.com/2019/08/19/heres-what-new-tariffs-will-cost-an-average-american-household.html) will cost every American household $1K/year.

_A whole lot of trade war ping pong_

Drama

__The crazy curve is getting steeper...__ We've never seen so many economic punches thrown in one day. A crucial element of economic growth is business investment — and it's hard out there for a CEO to do that right now. With President Trump and President Xi openly calling each other names, both sides are less likely to back down and cooperate if it could make them look weak-ish. 

4 moments that made Friday the worst day of the Trade War

Your new $1K trade "tax"

__There's a disturbance in the universe...__ Spider-Man (we know — he should drop the hyphen) is stuck in the middle of it. And it's a battle between __[Sony](https://robinhood.com/stocks/sne)__ and Marvel Comics, which is now owned by __[Disney](https://robinhood.com/stocks/dis)__. Back in 2015, the two struck a deal:

- __The superheroes:__ Marvel's creative team includes Spider-Man in its films, but Sony surprisingly owns the film rights.
- __The money:__ In return, Marvel (now Disney) got 5% of the ticket sales from the 1st day of a Spider-Man movie release (+ all the merchandise $$) — Sony got the rest of the box office.
- __The switcheroo:__ Now Disney's proposed a new 50/50 plan — both companies pay the production costs and split the profits evenly. But Sony said 'No.'

__So who's got the Infinity Stones?...__ No one. If this doesn't get resolved, then Spider-Man [won't be](https://www.vox.com/culture/2019/8/22/20827020/spider-man-mcu-sony-disney-tom-holland) in any Marvel films in the future. That means Iron Man and Black Panther can't call on Peter to save the world the next time it inevitably faces eternal death. That would be bad for both Disney and Sony, but right now the talks show no signs of life.

"_Are spidey-hands why nobody wants me?_"

Negotiate

__We're witnessing the power of franchise ecosystems...__ That new Spider-Man movie *Far from Home* is now Sony's top-grossing movie ever. Meanwhile, Disney's *Avengers: Endgame* became the largest movie of all time, period. Both share characters, which drives engagement and future spin-offs. That's why Disney acquired Fox for $71B — it's adding 15 movie franchises to its Star Wars and Avengers treasure chest. And it just delivered a record film year.

Spider-Man is a victim of a Disney/Sony contract war

__Curling is having a moment...__ Sporting goods stores aren't. With Amazon competition and a decline in youth team non-virtual sports, __[Dick's Sporting Goods](https://robinhood.com/stocks/DKS)__ stock is below where it was 12 years ago (and compadre __The Sports Authority__ is RIP). But it showed it can still suit up and take the field, announcing quarterly sales rose 3.2%. But we're interested in its guns experiment.

__The school shooting in Parkland, FL in Feb, 2018 was heartbreaking...__ Dick's CEO Ed Stack took action by banning assault rifles and raising the age to buy a gun at Dick's to 21. He's also [deciding](https://www.marketwatch.com/story/dicks-sporting-goods-removed-hunting-category-including-guns-from-125-more-stores-2019-08-22) whether to ban firearms altogether at the sporting goods store (they're in the "hunting & shooting" section). Here are the two intense choices he's facing:

1. __Don't ban guns__, and potentially face the negative PR of selling a weapon used in a mass shooting.
2. __Ban guns__, and face the negative PR of being anti-2nd amendment.  

Experiment

__This is *claaaassic* "A/B testing"...__ That's when you isolate one variable, then measure two groups to see which was best — one with it, one without it. In the fall, Dick's ended gun sales at 10 of its stores. This spring, it did it for 120 more. Now it's watching the performance of two groups: 

- __Group A:__ 600 stores still sell guns & ammo.
- __Group B:__ 130 stores don't.

Management hasn't decided yet which group is performing better, but it knows the one variable that would drive the difference: __guns__. Soon it'll announce which way is better for its profits.

Dick's Sporting Goods decided to A/B test guns

__Negative interest rates = The bizarro market...__ And it's happening right now in most of Europe. The federal government of Germany just did something nearly unheard of: It issued a 30-year bond with a *negative* interest rate. Here's why that's weird:

- __How a 30-yr bond normally works:__ An investor gives $900 today, in return for $1,000 in 30 years. *Investors make money by lending.*
- __How Germany's 30-yr bonds work right now:__ Investors gave Germany $1,149 today, in return for just $1,000 in 30 years. *Investors pay money to lend.*

__The asparagus is white...__ and you have to pay to keep money in a bank. These are both truths about Germany right now, and it's thanks to the European Central Bank — Europe's equivalent to the Fed. It's using a *negative interest rate* to force you to take cash from your savings account and invest it instead. It's like opposite day for European bank accounts:

- In Germany, banks won't pay you interest — *they charge you interest.*
- Banks have to pay money for holding your money in an account, so they probably pass that charge on to you.

Upside-down

__This is punishing you for not investing...__ European economies didn't recover from the financial crisis as well or fast as America's did. Policymakers there are still desperate to stimulate growth, which requires investment. So negative interest rates hurt people who don't invest. You're more likely to buy things or invest in stocks if the alternative is your money *shrinking* in a bank account. 