__April showers bring...__ May's expensive water bill. We're checking in on our old frenemy, inflation. Consumer prices were up 8.3% in April from a year earlier. The pace of inflation slipped a bit from March, falling for the first time in eight months — but is still close to a 40-year high. The biggest culprits were food, plane tickets, and housing. Zooming in:

- __That bites:__ Food prices were up over 9% from a year ago. Dairy products jumped 2.5% from March alone, the category's largest monthly price gain since 2007. Milk is up 15% from April 2021, and your omelet isn't faring much better: eggs are +10% month over month.
- __Not fly:__ Your summer getaway’s making you sweat before you hit the beach. Airline fares were up a whopping 33% from a year ago, and soared 19% from March alone. 
- __Lost steam:__ Not everything got more #flated. Energy and clothing prices fell from March to April, with gas dropping 6%. Don't get too pumped — that’s still up 44% year over year.

__JFK to LAX...__ You know it's bad when $600 looks like a sweet deal. With stimulus gone, consumers are dipping into savings to support [rising spending](https://snacks.robinhood.com/newsletters/7Eii6CUWY0BFV8UUv3TpJD/articles/6HBcxIs3mE0INLHalLT7zn/). The Fed’s hiked rates twice so far this year to tame prices, but April's data inspires little confidence that broad inflation is cooling. And despite the hot labor market, prices are rising faster than historically high wage gains.

The dreaded dairy aisle (Michael M. Santiago/Getty Images)

Flated

__Lower income = smaller runway…__ Americans with low incomes are the [most sensitive](https://www.npr.org/2022/05/11/1097966775/inflation-poor-income-inequality-biden-federal-reserve) to inflation because they have smaller cash reserves to meet elevated prices for necessities (think: $4.50 milk gallons and wild rent prices). While there are signs that inflation could be peaking, the real question is how long it’ll take to get back to “acceptable” levels. The longer it takes, the sooner savings will run dry.

From flights to cheese, prices are still rising — and while inflation could be peaking, real relief looks distant

__Sunbathing at a shepherd’s hut…__ welcome to the new age of great escapes. __[Airbnb](https://robinhood.com/stocks/ABNB)__ has launched its biggest makeover in more than a decade, hoping you’ll ditch your spa getaway for an off-the-grid excursion. The revamp includes the ability to search by category, from castles to tiny homes, no specific destination required. Plus:

- __AirCover:__ Free travel protection with a 24/hr safety line, and a “get what you booked” guarantee. AKA: travel insurance. 
- __Split stays:__ A frictionless way to split longer trips between two homes, intended to appeal to digital nomads.
- __“OMG” getaways:__ A new category highlighting IG-worthy stays, like an alien-themed [glamping](https://www.airbnb.com/rooms/33518282/photos?source_impression_id=p3_1652292763_%2B1kSo8fTVlR2YqQj) site in Joshua Tree (FYI: it’s booked solid till 2025).

__Team meetings in Tahoe...__ Airbnb almost collapsed when Covid hit, cutting a [quarter](https://www.npr.org/sections/coronavirus-live-updates/2020/05/05/850986054/airbnb-cuts-1-900-jobs-25-of-its-workforce-as-pandemic-freezes-travel#:~:text=Airbnb%20says%20it's%20cutting%201%2C900,email%20to%20employees%20on%20Tuesday.) of its workforce as bookings fell off a cliff. But the rental giant staged a quick pivot — not to mention an IPO — recognizing that "old" travel was gone while creating experiences for remote safety-conscious customers. Bookings [reached](https://www.cnbc.com/2022/05/03/airbnb-abnb-earnings-q1-2022.html) a record 102M last quarter, and nearly a quarter were long-term rentals. The company expects a strong summer travel season to keep fueling record sales.

- __Rental competition:__ Rival __VRBO__ (owned by __[Expedia](https://robinhood.com/stocks/EXPE)__) also [saw](https://skift.com/2022/05/02/expedia-says-half-of-recent-vrbo-customers-were-new/) record bookings in the first quarter, and said half its customers were brand new.
- __7 out of 10 Americans__ expect to travel this summer, though inflation could scramble some of those plans.

Treehouse

__Flexibility and discoverability are the future of travel…__ and Airbnb has always had a built-in advantage for that future. Its revamp is intended to merge the things that customers love about the service (think: the whimsy of finding and staying in a treehouse) with the comforts of the traditional hotel experience (think: getting exactly what you pay for, and a refund if you don’t).

Airbnb pulled off a pandemic turnaround for the ages — now it’s betting on a future with all-new travel habits

From flights to cheese, prices are still rising fast — and while inflation could be peaking, relief looks distant

Dow Jones

S&P 500

Nasdaq

Bitcoin

There’s enough concrete in the Hoover Dam to pave a highway from San Francisco to NYC

⛰️ Inflation’s peak?

__Not so stable after all…__ Stablecoins are causing crypto chaos. Refresher: stablecoins are cryptocurrencies whose value is (theoretically) pegged to another asset, like the USD. But this week __TerraUSD__ (UST), the third-largest stablecoin, was unpegged from its $1 value and [fell](https://www.cnbc.com/2022/05/10/bitcoin-btc-investors-panic-as-terrausd-ust-sinks-below-1-peg.html) to $0.62. Investors then sold UST (think: crypto bank run), sending jolts through the market.

- __Broken algorithm:__ Most stablecoins are backed by cash reserves, but “algorithmic” coins like UST are backed by “sister” coins. When one sister dips below $1, it can be swapped for the other at a small profit, which (theoretically) keeps both stable. 
- __Bitcoin bailout:__ During this week’s bitcoin sell-off, UST *and* its sister coin slumped together, causing investors to ditch *both*. To prop ’em up, UST’s creator sold some bitcoin from a $3.5B emergency stash — but UST still isn’t back to $1.

__Crypto’s confidence crisis…__ goes beyond stablecoins. The crypto market has lost nearly $2T in capitalization from its November peak. Even __[bitcoin](https://robinhood.com/crypto/BTC)__ is down 50% since then, which has led analysts to question its status as “reserve currency” for other coins like UST. 

- __Companies__ including __[Tesla](https://robinhood.com/stocks/TSLA)__, __[Square](https://robinhood.com/stocks/SQ)__, __[Coinbase](https://robinhood.com/stocks/COIN)__, and __[MicroStrategy](https://robinhood.com/stocks/MSTR)__ have lost billions on crypto in recent months. 
- __El Salvador,__ which accepts bitcoin as legal tender, has lost $$ too (though it bought 500 bitcoin this week).

A stablecoin breaks the buck (dem10/Getty Images)

Unstable

__Most cryptos were minted in calm weather…__ Now they’re caught in the path of two storms: regulation and recession. UST’s “buck-breaking” moment showed that even so-called stable coins are risky, prompting Treasury Secretary Janet Yellen to call — again — for new crypto rules. Plus, economists predict a recession’s coming, which could cause un-tested coins like UST to lose *more* value. Investors may get caught in the rain: most short-term crypto investors are already underwater, and more than half of bitcoin holders are in the red.

A stablecoin just “unpegged” from the dollar, testing crypto’s ability to weather big downturns

__Loanly, I'm Mr. Loanly...__ "Buy now, pay later" doesn’t sound as good as it used to. The days of near-zero interest rates and stimmy checks are gone, and it's [hurting](https://techcrunch.com/2022/05/10/the-bnpl-boom-may-be-fading/) loan providers — from BNPL firms like __[Affirm](https://robinhood.com/stocks/AFRM)__ to accessible lending platforms like __[Upstart](https://robinhood.com/stocks/UPST)__.

- __Shares of Upstart tanked__ 56% yesterday, despite the company's better-than-expected [earnings](https://ir.upstart.com/news-releases/news-release-details/upstart-announces-first-quarter-2022-results) (revenue more than doubled and profit 3X'd).
- __The AI-driven platform__ connects people with less-than-stellar credit scores to lenders with favorable terms. Its mantra: "you are more than your credit score."
- __Problem:__ Upstart cut its revenue forecast for the year and predicts lower sales and zero profit for this quarter.

__Pay in installments?...__ Maybe *nah*. Lending [boomed](https://snacks.robinhood.com/newsletters/1TtUXZyHvZ2SETOZOaUYq7/articles/2wpby5ZPzAfks9OlK1Syl/) during the pandemic as extra-low interest rates made borrowing cheap — from home buying to online clothes shopping. BNPL firms like __Afterpay__, __Klarna__, and Affirm thrived by letting you buy those $700 Gucci loafers *now* and pay in installments *later*. Last year, Americans spent more than [$20B](https://www.sfgate.com/news/article/influencers-lead-Gen-Z-into-debt-17142294.php) through BNPL. Almost a year ago, Klarna hit a $46B valuation, becoming the second-most-valuable private fintech. Now:

- __Interest rates__ are expected to keep rising as the Fed tightens its monetary belt to fight inflation. Cue: Affirm stock, down 81% this year. 
- __Loan-default rates__ are rising after cruising at historic lows for the past year and a half. Lenders are demanding higher interest to make up for higher risk.

BNPN

__When rates rise, BNPN wins…__ That’s “buy now, pay now.” Rising rates make loans more expensive — from credit-card debt to car leases — so consumers might start taking out fewer loans (hence: why Upstart slashed its forecast). Now the BNPL sector is being repriced to reflect that, and debt-laden Gen Zers are starting to [turn against](https://www.sfgate.com/news/article/influencers-lead-Gen-Z-into-debt-17142294.php) the services whose growth they fueled.

Upstart and Affirm shares plunge as the “buy now, pay later” boom fades — now, rising rates could boost “BNPN”

A stablecoin “unpegged” from the USD, testing crypto’s ability to weather big downturns

The T. Rex was alive closer in time to humans than to the stegosaurus

🪙 Unstablecoins

__Over prescribed…__ and under investigation. This weekend, online mental-health startup __Cerebral__ [said](https://www.wsj.com/articles/cerebral-receives-subpoena-from-federal-prosecutors-11651950307?mod=business_lead_pos12) it’s been subpoenaed by the feds over its pill-prescription practices. Refresher: the FDA changed the rules to allow virtual prescriptions during the pandemic — even for ADHD meds like Adderall, which are easily abused. Last year, ADHD drug prescriptions jumped 10% from 2020, and critics [worry](https://www.wsj.com/articles/startups-make-it-easier-to-get-adhd-drugs-that-made-some-workers-anxious-11648267205) telehealth startups have become digital pill mills:

- __In March,__ Bloomberg and the WSJ [reported](https://www.bloomberg.com/news/features/2022-03-11/cerebral-app-over-prescribed-adhd-meds-ex-employees-say) that Cerebral and __Done__ pushed workers to prescribe ADHD meds after 30-minute video sessions. 
- __In response,__ __[Walmart](https://robinhood.com/stocks/WMT)__, __[CVS](https://robinhood.com/stocks/CVS)__, __[Walgreens](https://robinhood.com/stocks/WBA)__, and startup __Truepill__ reportedly stopped distributing ADHD meds for telehealth startups, with Cerebral also pausing new ADHD scripts.

__Robo-therapy roller coaster…__ It’s not just ADHD: rates of anxiety and depression [spiked](https://www.who.int/news/item/02-03-2022-covid-19-pandemic-triggers-25-increase-in-prevalence-of-anxiety-and-depression-worldwide#:~:text=Wake%2Dup%20call%20to%20all,mental%20health%20services%20and%20support&text=In%20the%20first%20year%20of,Health%20Organization%20(WHO)%20today) 25% during the pandemic, the WHO said. So did [investment](https://www.wsj.com/articles/as-demand-for-mental-health-care-booms-investors-see-opportunities-11652018401?mod=business_lead_pos7) in mental-health startups: nine of them (including Cerebral) hit unicorn valuations ($1B+). But many execs at these fledgling companies have no medical background, and some have been accused of using Silicon Valley strategies that prioritize growth over patient care:

- __Viral marketing:__ Cerebral reportedly spends millions on ads on __TikTok__, Insta, and __Google__ each month; some patients say TikTok ads convinced them they had ADHD. 
- __D2C pill subscriptions:__ Cerebral and Done charge patients a monthly fee, meaning they earn more from long-term prescriptions.

Telehealth under scrutiny (MirageC/Getty Images)

Pills

__Telemedicine is pharma’s Wild West…__ and the Cerebral case could mean regulators are ready to play sheriff. The telehealth model exploded during Covid, when VC-funded startups took a page out of tech’s "growth at all costs" playbook to scale fast. But a one-size-fits-all telehealth model may not work as well for complex diagnoses like ADHD as it does for common ailments like the flu — and this tele-Adderall crackdown could signal more regulation to come.

Regulators investigate mental-health startup Cerebral, signaling an end to telehealth’s Wild West

__Swapping face masks for lip kits…__ Saturday nights are back. As more of us get glammed up for social soirees, multistep skin-care routines are taking a back seat. Beauty giant __[Coty](https://robinhood.com/stocks/COTY)__ — home to names like CoverGirl and Kylie Cosmetics — [saw](https://investors.coty.com/news-events-and-presentations/news/news-details/2022/Coty-Reports-3Q22-Sales-Growth-Ahead-of-Expectations-and-Progress-Across-All-Metrics/default.aspx) sales jump 15% last quarter. It’s expecting an even bigger profit bump this year thanks to the [return of IRL events](https://snacks.robinhood.com/newsletters/7Eii6CUWY0BFV8UUv3TpJD/).

- __Like bees to honey:__ Coty's portfolio of luxe fragrance lines grew 20% as middle-seat-bound travelers splurged on name-brand sprays from __[Burberry](https://robinhood.com/stocks/BURBY)__ and __[Gucci](https://robinhood.com/stocks/REAL)__.
- __Clean face:__ Coty’s CEO said natural cosmetics (think: vegan, eco-friendly ingredients) were also a key growth [driver](https://www.fool.com/earnings/call-transcripts/2022/05/09/coty-class-a-coty-q3-2022-earnings-call-transcript/), a trend that took off during the pandemic.

__Welcome to the makeup renaissance…__ where cosmetic giants from __[Estée Lauder](https://robinhood.com/stocks/EL)__ to __L’Oréal__ post record sales as you ditch the couch for a night out. In the US, shoppers are using their extra $$ to [splurge](https://www.reuters.com/business/retail-consumer/loreal-first-quarter-sales-up-135-2022-04-19/) on TikTok-inspired beauty trends and eye-popping palettes. Last year, US “prestige beauty” sales (think: department-store brands like __Clinique__) [rose](https://www.gcimagazine.com/consumers-markets/news/22018003/the-npd-group-2021-us-prestige-beauty-growth-drivers-ranked) 30% from the year before, topping pre-pandemic levels. Now:

- __In stores:__ Beauty retailers like __Sephora__ and __[Ulta](https://robinhood.com/stocks/ULTA)__ have seen foot traffic [jump](https://www.premiumbeautynews.com/en/u-s-beauty-market-to-grow-as,20284) 25% compared to last year.
- __Online:__ Coty said its e-commerce sales [rose](https://investors.coty.com/news-events-and-presentations/news/news-details/2022/Coty-Reports-3Q22-Sales-Growth-Ahead-of-Expectations-and-Progress-Across-All-Metrics/default.aspx) double digits, even after hiking prices to keep up with higher packaging and ingredient costs.

Blush

__Don’t call it a cosmetics comeback…__ at least not yet. Coty’s still at the mercy of all the usual economic headwinds (supply backups and inflation). Plus, WFH and flexible work situations have sent [weekly](https://www.kantar.com/inspiration/fmcg/less-is-more-how-the-pandemic-shifted-the-beauty-market) makeup usage down 28% compared to 2019. Coty’s premiumization (think: fancy-fied products it can charge extra for) has kept sales strong. But the stock hasn’t caught up: Coty shares are [down](https://robinhood.com/stocks/COTY) 25% this year.

Coty sales are a vision as consumer demand for cosmetics defies rising inflation

An investigation of health startup Cerebral could end telehealth’s Wild West era

The Nasdaq — down 27% this year — has given up all its 2021 gains

🩺 Telehealth under scrutiny

__Three weddings and a bar mitzvah...__ Dance floors and open bars have prevailed over __[Zoom](https://robinhood.com/stocks/ZM)__ ceremonies and seltzer cans. 2022 is shaping up to be the "catch-up year," as Americans spend big on experiences they missed over the pandemic. Inflation has been more persistent than Elon trying to buy __[Twitter](https://robinhood.com/stocks/TWTR)__, but consumers have shrugged off high prices, which [hit](https://www.cnn.com/2022/04/29/economy/pce-inflation-march/index.html) a fresh 40-year high (again). 

- __Hawkish:__ The days of “money printer go brrr” are gone. The Fed started raising rates in March to tame soaring prices. Last week came the largest hike since 2000. 
- __Higher interest rates__ make borrowing pricier (think: credit-card interest) and saving more attractive (think: savings-account yields). Still...
- __YOLO spending:__ Consumer spending surged 1.1% in March, [boosted](https://www.reuters.com/business/us-consumer-spending-beats-forecasts-march-inflation-soars-2022-04-29/) by demand for international getaways, restaurants, and hotels.

__Salmon or short rib?...__ Too many RSVPs. The "catch up" craze means that all the nixed celebrations are roaring back:

- __Weddings:__ Good luck finding a venue. 2022 is set to ring in the most nuptials in nearly four *decades*. Wedding-related indulgences are set to hit $68B, and guests are also [spending more](https://www.wsj.com/articles/wedding-travel-hotels-cost-11644970118). That helps hotels like __[Marriott](https://robinhood.com/stocks/MAR)__, which [announced](https://skift.com/2022/05/04/marriott-sees-record-direct-bookings-at-its-hotels/) record direct bookings. Meanwhile, __[Signet](https://robinhood.com/stocks/SIG)__ and __Tiffany's__ have seen diamond sales [surpass](https://wwd.com/accessories-news/jewelry/diamonds-roar-back-above-pre-pandemic-levels-1235063320/) 2019 levels.
- __Concerts:__ From festivals to [sold-out](https://omaha.com/entertainment/music/review-sold-out-billie-eilish-concert-was-all-about-the-singer-her-music-and-her/article_26b94e20-a5be-11ec-8d96-6f0d7685aeaa.html) Billie Eilish concerts, live music is back. __[Live Nation](https://robinhood.com/stocks/LYV)__ said its ticket sales were up 45% from early 2019 levels, and it just posted its best first quarter ever.
- __Vacays:__ Between spring breakers and summer planners, __[Booking.com](https://robinhood.com/stocks/BKNG)__ raked in its highest quarterly bookings of all time. __[Amex](https://robinhood.com/stocks/AXP)__ saw travel spend double and __[Visa](https://robinhood.com/stocks/V)__ said summer demand is on fire.

Fourth wedding in three days (FG Trade/Getty Images)

YOLO

__Playing catch-up could fizzle out…__ The Fed’s [betting](https://www.cnbc.com/2022/05/03/stock-market-futures-open-to-close-news.html) it can slow inflation without causing a recession, but that’s TBD. If it tightens its belt too aggressively, Americans could tighten their wallets (recession wedding = not ideal). Meanwhile, consumer confidence [dipped](https://www.reuters.com/business/us-consumer-confidence-dips-april-2022-04-26/) in April as Russia’s war, China’s Covid crackdown, and swinging oil prices all heightened econ worries. People have already started [spending less](https://www.wsj.com/articles/manufacturers-could-soon-face-demand-woes-on-top-of-supply-chain-snarls-11651511557) on [online shopping](https://www.cnbc.com/2022/05/05/e-commerce-stocks-plummet-as-consumers-pull-back-online-spending.html), appliances, furniture, and cars. If high inflation keeps up and savings run dry, they could cut back on experiences too.

2022 is poised to be the “catch-up year,” from constant weddings to sold-out concerts — but the splurge could run dry

__Ripping the Band-Aid off…__ The EU’s preparing to [ban](https://www.cnn.com/2022/05/04/business/eu-russia-oil-ban/index.html) Russian oil by year’s end to pressure President Putin — a shift from just weeks ago. The ban will test Europe’s reliance on Russia, which [supplies](https://www.nytimes.com/2022/05/04/world/europe/eu-russia-oil-embargo.html) a third of the EU’s oil. Hungary, Slovakia, and others already said they’d need more time to ditch Russian oil. The EU ban will [take](https://www.rystadenergy.com/newsevents/news/press-releases/big-bang-to-a-steady-stream-spr-release-to-provide-only-temporary-relief-for-consumers/) 2M barrels off the market daily, which could send global oil prices — up 40% this year already — even higher. Supply disruptions have also [reduced](https://www.bloomberg.com/opinion/articles/2022-05-04/u-s-east-coast-diesel-supply-is-running-on-fumes?srnd=premium&sref=px9VEDa6) US diesel inventory to a 30-year low, stressing diesel-guzzling industries (think: shipping, energy). 

__(Super) Bored Ape Yacht Club…__ Not [even](https://www.nbcnews.com/tech/crypto/nfts-market-decline-rcna27338) Snoop Dogg can keep NFT prices from dropping like they’re hot. Last year NFTs made a splash in the crypto-sphere, becoming a $17B market seemingly overnight. But global sales are down 92% from September as traders feel the weight of inflation and high interest rates. Last week __[Coinbase](https://robinhood.com/stocks/COIN)__ launched its first NFT marketplace, but saw less than $60K worth of trades on its debut. With markets going haywire, collectors are less likely to splurge on a digi-ape — some are selling for less than a third of the OG price.

Zoom Out

Stories we’re watching...

__Shifting gears...__ This week could be make or brake for __[Rivian](https://robinhood.com/stocks/RIVN)__, which reports Wednesday. The EV biz’s shares are down 75% from its November IPO after the truck maker [fell short](https://www.cnbc.com/2021/12/17/shares-of-rivian-hit-new-low-following-2021-production-cuts.html) of production goals in 2021 and [lowered](https://techcrunch.com/2022/03/10/rivian-shares-reach-new-low-after-reporting-disappointing-q4-earnings/) production targets for this year. Rivian’s skid has hit its backers hard: __[Amazon](https://robinhood.com/stocks/AMZN)__ (which [owns](https://www.fool.com/investing/2022/05/04/why-rivian-is-dropping-with-ipo-expiration-coming/) 18%) and __[Ford](https://robinhood.com/stocks/F)__ (which [owns](https://www.fool.com/investing/2022/05/04/why-rivian-is-dropping-with-ipo-expiration-coming/) 11%) both lost billions on their stakes last quarter, when Rivian’s losses jumped 7X from a year ago. Rivian’s IPO lockup also ends today, which gives early stockholders their first chance to sell — and could lead to a bigger selloff.

__China’s retail retreat…__ Last week investors wiped $26B off __[Alibaba’s](https://robinhood.com/stocks/BABA)__ market cap on rumors that the founder of the “Amazon of China” was detained (the mix-up: same last name, different guy). The scare comes as China’s strict Covid lockdowns put pressure on the country’s economy and deter consumers from dropping cash on non-essentials (like: new clothes, vacays). Last quarter Baba posted its slowest sales growth since its 2014 IPO. China’s spending slowdown, and competition from e-comm rivals like __[JD.com](https://robinhood.com/stocks/JD)__, could deliver another blow to Baba’s profits when it reports Thursday.

Events

Coming up this week...

- __[Click](https://snacks.robinhood.com/newsletters/7drI8vLSEid0YZLml7w2fH/articles/4J0Z4dTus6bhb7m6accQYz/):__ Ecommerce stocks like __[Shopify](https://robinhood.com/stocks/SHOP)__ are getting hammered as the pandemic boom in e-buying (fueled by stimmy checks and boredom) loses steam. Consumers are shopping like it's 2019 — more on experiences, less on stuff.
- __[SCOTUS](https://snacks.robinhood.com/newsletters/PbfDGtpHVvDV3e1fKrQWi/articles/1YJ0K0jfGxDuI3ODrepPrf/):__ After a leaked draft opinion revealed that the Supreme Court appears likely to overturn Roe v. Wade, corporate America's response has been mostly silent. But pushback from employees and the public could change that.
- __[Diverge](https://snacks.robinhood.com/newsletters/6AJH7e5jPEol78eTxOBd7p/articles/6wcF6KI3GX84eTlowlDJp7/):__ While __[Lyft](https://robinhood.com/stocks/LYFT)__ is driving slow and straight, __[Uber](https://robinhood.com/stocks/UBER)__ is swerving to diversify. Last week’s earnings showed that Uber’s numerous revenue streams (rides, freight, food) are helping it speed ahead of ride-focused Lyft.

ICYMI

Last week's highlights...

2022 is poised to be the “catch-up year,” from constant weddings to sold-out concerts

In 1934, Levi’s became the first company to make jeans for women — decades before it was mainstream for women to wear pants in public

🥂 Year of YOLO

__The return of (IRL) retail therapy…__ While you ditch front-porch packages for fitting rooms and food courts, online retailers are being left in the dust. In yesterday’s big selloff, shares of __[Shopify](https://robinhood.com/stocks/SHOP)__ sank [15%](https://robinhood.com/stocks/SHOP) after the popular ecomm platform saw sales slow for the fourth straight quarter. 

- __Ripped receipt:__ Shopify’s sales rose 22%, to $1.2B, but that was a fraction of its 110% gain from the same quarter last year.
- __Troublesome trifecta:__ Execs blamed inflation, labor shortages, and a return to IRL shopping for the slowdown — and said the rest of the year doesn’t look much better. 

__Caribbean cruise > cyber sales...__ In the past two years, nearly a fifth of every dollar [spent](https://www.digitalcommerce360.com/article/us-ecommerce-sales/) in the US came from online orders. Yet with consumers returning to their 2019 spending habits — on concerts, vacays, and Sunday brunch — the boom in e-buying is losing momentum. US ecommerce sales have dropped 3X compared to 2020 levels. That’s showing up in the bottom line of some of the biggest pandemic winners:

- __Shares of Wayfair__ tumbled after the online furniture seller lost nearly 2M customers and $320M in sales last quarter.
- __Both [Etsy](https://robinhood.com/stocks/ETSY) and [eBay](https://robinhood.com/stocks/EBAY) lowered__ their sales forecasts for the year, and didn't say when (or if) they’d return to pandemic-era profits.
- __A week ago, [Amazon’s](https://robinhood.com/stocks/AMZN) stock__ had its [worst](https://www.cnbc.com/2022/04/29/amazon-shares-sink-11percent-on-disappointing-guidance.html) day in over a decade after cooling sales led to its first quarterly loss since 2015.

Online retailers have a “pull forward” problem (Noam Galai/Getty Images)

Click

__The Great Normalization is here...__ Ecommerce sites benefited from a huge pull-forward boost in demand during the pandemic, fueled by stimmy checks and boredom. As __[Visa’s](https://robinhood.com/stocks/V)__ and __[Mastercard’s](https://robinhood.com/stocks/MA)__ earnings [showed](https://snacks.robinhood.com/newsletters/1Ls3rUz4jDKI9WX1KLhQFI/articles/64w8VxOJwTvKaTng5OSrZC/), consumers are still opening their wallets — they just have new priorities. For platforms like Shopify, it means adjusting expectations for the *new* new normal of more balanced spending.

Ecommerce stocks are getting hammered as shoppers get back to spending like it’s 2019

__Come Shell or high water…__ Soaring energy prices: bad for consumers, great for oil companies. How great? Yesterday, London-based __[Shell](https://robinhood.com/stocks/SHEL)__ [reported](https://www.nytimes.com/2022/05/05/business/shell-earnings-record-profit.html) a record $9.1B quarterly profit — 3X last year’s — despite $4B+ in losses related to its leaving Russia. It’s something of a trend. 

- __Pumpin’ profits:__ In the most recent quarter, BP posted its highest profit in a decade, despite $26B in Russia losses. __[Exxon](https://robinhood.com/stocks/XOM)__ [said](https://thehill.com/policy/energy-environment/3471782-exxon-chevron-post-massive-q1-profits-amid-soaring-gas-prices/) it doubled profits from last year, and __[Chevron](https://robinhood.com/stocks/CVX)__ *quadrupled* its haul.
- __Buy, buy, buybacks:__ Buoyed by bumper profits, all four oil giants plan to boost share buybacks and raise dividends, two ways to return $$ to investors. 

__Big buybacks, big blowback…__ US and UK lawmakers have started calling for a “windfall tax” on energy giants, a one-time tax on their excess profits. The idea is to use the cash to help consumers with rising prices at the pump. Critics say the money would be better spent investing in renewable energy. 

- __Winds of change:__ Spain and Italy already [slapped](https://www.reuters.com/business/energy/enel-sticks-guidance-q1-boosted-by-new-green-capacity-asset-sale-2022-05-04/) windfall taxes on some energy companies, but experts don’t expect the US or UK to follow suit.

Slick

__Windfalls come in many forms…__ Russia’s invasion of Ukraine gave oil giants a financial windfall in booming profits. It also gave them a *strategic* windfall: it illustrated how dependent the global economy still is on fossil fuels, whether we like it or not. Earlier this week, __[VW](https://robinhood.com/stocks/VWAGY)__ [said](https://www.cnbc.com/2022/05/04/volkswagen-to-prolong-coal-fired-power-as-russia-concerns-continue.html) it planned to keep using coal because of a proposed EU ban on Russian oil. Then Shell’s CEO told investors the war proves the need for big oil producers, despite the pressure to act on the climate crisis.

Shell — Europe’s biggest oil biz — posted a record $9B profit, yet whispers of a “windfall tax” are growing louder

The jersey Diego Maradona wore when he scored the famous “Hand of God” goal sold for $9.28M — the highest price ever paid for sports memorabilia

🛒 Ecommerce wipeout

__History unwritten...__ Earlier this week, a leaked draft opinion [revealed](https://www.politico.com/news/2022/05/02/supreme-court-abortion-draft-opinion-00029473) that the Supreme Court appears ready to strike down Roe v. Wade, the 1973 landmark ruling that made abortion a constitutional right. Some companies, including __[Apple](https://www.houstonchronicle.com/business/columnists/tomlinson/article/Apple-Amazon-among-Texas-companies-that-promise-17144880.php)__ and __[Amazon](https://robinhood.com/stocks/AMZN)__, are responding by proactively offering financial support for women who need access to reproductive healthcare. But [most](https://fortune.com/2022/05/03/supreme-court-roe-v-wade-draft-decision-response-from-major-companies/) companies have so far been silent. 

- __Fortune magazine [reached](https://fortune.com/2022/05/03/supreme-court-roe-v-wade-draft-decision-response-from-major-companies/)__ out to 30 of the biggest US companies for a reaction to the leak, but almost all gave “no comment.”
- __The Chamber of Commerce__ declined to comment, and the Business Roundtable (think: a group made up of 200+ top CEOs ) did “not have a [position](https://www.nytimes.com/2022/05/04/business/dealbook/us-businesses-roe-wade-abortion.html).”

__Social issues and corporate activism…__ are becoming increasingly intertwined, including over abortion. Last year __[Bumble](https://robinhood.com/stocks/BMBL)__, __[Yelp](https://robinhood.com/stocks/YELP)__, and others [helped](https://www.newsweek.com/these-companies-are-publicly-opposing-texas-abortion-law-1631226) form the "Don't Ban Equality" coalition following Texas' abortion law banning the procedure after six weeks. But other major recent social issues and movements have spurred companies to respond, too: 

- __After a police officer murdered__ George Floyd in 2020, dozens of leading companies [pledged](https://www.washingtonpost.com/business/interactive/2021/george-floyd-corporate-america-racial-justice/) a collective $50B to combat racism and increase diversity in their ranks. 
- __[Disney](https://robinhood.com/stocks/DIS)__ recently found itself [caught](https://www.usatoday.com/story/money/business/2022/04/28/will-disney-leave-florida/9571762002/?gnt-cfr=1) between its employees and Florida’s Republican governor over its stance on the state’s controversial laws for schools regarding LGBTQ rights. 

American boardrooms can’t hide from abortion politics (Robert Alexander/Getty Images)

__Now abortion looks set to become a bigger boardroom issue…__ Should Roe be reversed when the court gives its decision next month, companies will face increasing pressure to take a stand on a highly polarizing topic (right before an election season), whether that means issuing public statements or making access to reproductive healthcare a standard corporate benefit. Whatever positions they take, the risk will be ostracizing customers, employees, or states where they do biz.

As abortion takes center stage at the Supreme Court, corporate America is (mostly) staying silent

__A pasta promise…__ European shoppers are getting help in the grocery aisle. Consumer price increases in Europe hit another record last month as Russia’s war on Ukraine dragged on, straining price-sensitive shoppers. So __Leclerc__, France’s largest supermarket chain, [plans](https://ca.finance.yahoo.com/news/coffee-ketchup-retailers-seek-price-104304896.html) to put popular products under a “price shield” to make them more affordable. UK markets also lowered prices of essentials, and others across the EU are considering cuts.

- __How the shield works:__ Leclerc will freeze prices of 120 top products through July. The desired result: predictable ketchup, coffee, and pasta prices.
- __A pricey plan:__ Leclerc may pay more to stock its shelves, since suppliers like __[Unilever](https://robinhood.com/stocks/UL)__ plan to keep hiking prices to offset rising costs (think: wheat and corn). But Lecelerc hopes the shield stops shoppers from fleeing to rival supermarkets.

__The shields haven’t made it across the pond…__ Instead, we get #shrinkflation. Food prices are spiking even more sharply in the US, but supermarkets haven’t done much to keep them in check. Instead, food *producers* have found ways to mask rising prices with [creative ’flation](https://snacks.robinhood.com/newsletters/jtHnqwq8xydDjbgiulBNB/articles/6u4NsfgUX9a28K4g5NZ4JS/): Frito Lay took a few chips from each bag of Doritos, __[Mondelez](https://robinhood.com/stocks/MDLZ)__ rebranded Oreos as “limited edition,” and __[Pepsi](https://robinhood.com/stocks/PEP)__ shrank its Gatorade bottles.

Aisle

__Price guarantees build customer loyalty…__ but they’re also expensive. US retailers like __[Walmart](https://robinhood.com/stocks/WMT)__, __[Best Buy](https://robinhood.com/stocks/BBY)__, and __[Target](https://robinhood.com/stocks/TGT)__ use price-match guarantees to keep shoppers coming back. Yet persistent inflation is making that harder, forcing __[McDonald’s](https://robinhood.com/stocks/MCD)__, KFC, and Burger King to downsize their dollar menus as their own costs rise. Even if Leclerc’s price shield keeps shoppers coming back for a while, it’ll be hard to keep up in the long run.

EU markets launch “price shields” to protect inflation-weary shoppers — while US buyers get shrinkflation

As abortion takes center stage at the Supreme Court, companies are (mostly) staying silent — for now.

Cinco de Mayo is not Mexico’s Independence Day, but a celebration of a key Mexican army victory during the Franco-Mexican War

🏛️ Corporate America and abortion

__15-inch AUX cord...__ 17-min ETA. America's #2 ride-hailer just rolled up with earnings. __[Lyft](https://robinhood.com/stocks/LYFT)__ is known for its transportation focus (think: no food delivery) and cars with fuzzy pink mustaches (see: [this Prius](https://www.bizjournals.com/houston/news/2014/02/19/sideswiped-by-lyft-city-surprised-by-launch.html)). We're checking in on its #s from a quarter of pricey gas, supercharged fares, and disappearing mask mandates:

- __Ride volumes__ reached a pandemic high as the rebound continued, helping revenue jump 44% from the year-ago quarter. Buuut…
- __Lyft stock plunged__ 27% in extended trading on word that active riders dropped by nearly 1M from the previous quarter, to 17.8M. Guidance was also uninspiring.

__Uber Black, Lyft Pink…__ not a K-pop girl band. Lyft's bigger rival reports today. Lyft says it’s "singularly driven" by its mission to improve lives with transportation (cars, bikes, etc.). Meanwhile, __[Uber’s](https://robinhood.com/stocks/UBER)__ driving into *everything*, from food to [ecomm deliveries](https://www.bloomberg.com/news/articles/2022-03-29/uber-wants-to-outdo-amazon-for-local-commerce-delivery). It’s no longer a ride-hail company.

- __Delivery__ (aka: Eats) made up about [half](https://investor.uber.com/news-events/news/press-release-details/2022/Uber-Announces-Results-for-Fourth-Quarter-and-Full-Year-2021/) of Uber's gross bookings last quarter, as taco-delivery habits stuck despite restaurant reopenings.
- __Ride__ bookings surged 67%, including niche-er offerings like Uber for Business (employee rides) and [Uber Health](https://www.uberhealth.com/) (clinic rides).
- __Uber Freight,__ which connects semitruck drivers with high-volume loads (think: __[Heineken](https://robinhood.com/stocks/HEINY)__ kegs), more than tripled revenue, to over $1B.
- __Cabs?...__ In March, NYC [agreed](https://snacks.robinhood.com/newsletters/5DjHBJsc7oUsCSdRVpJd6X/articles/2wf5WRtQbO2wr1viGVjnYC/) to list all its yellow cabs on the Uber app, which gives the company a massive new fleet.

Ride giants take diverging routes (Smith Collection/Gado/Getty Images)

Taco

__The OG isn't always the growth key…__ Uber's core biz was ride hail. Now delivery is bringing in nearly half of sales, and freight is its fastest-growing biz. While Lyft is also enjoying the ride rebound, it doesn't have those diversified growth avenues. That could be why Uber's annual revenue is 5X as big as Lyft's. But they have this in common: Uber and Lyft lost hundreds of millions of dollars last year, and both stocks are down ~30% this year.

While Lyft stays focused on rides for growth, food and freight could shine in Uber’s earnings

__Two-minute bathroom break…__ TV commercials are back in style. This week, ad-supported streaming platform __Tubi__ [said](https://techcrunch.com/2022/05/03/tubi-reports-record-growth-expands-original-content-and-linear-channel-offerings/) it had doubled its active viewers since 2020, and planned to launch 100 original shows and movies this year. Meanwhile, __[Netflix](https://robinhood.com/stocks/NFLX)__, the world’s most popular subscription streamer, is [struggling](https://snacks.robinhood.com/newsletters/1hJKveGEOmvpzuLtfVejiF/articles/43M2Oild3MGMPYMecA8Q7K/) with its slowest growth in years.

- __The price is right:__ Unlike Netflix, which starts at $10/month, __[Fox](https://robinhood.com/stocks/FOX)__-owned Tubi is free with ads. It’s available on smart TVs and devices like __[Roku](https://robinhood.com/stocks/ROKU)__.
- __Quantity over quality:__ Tubi has the [largest](https://tubitv.com/) catalog of on-demand streaming content: 20K old movies and shows. Think: no Marvel flicks (those are on __[Disney+](https://robinhood.com/stocks/DIS)__) but both the 1943 *and* the 1966 versions of “Batman.”

__Streaming is changing FAST…__ Blame #subscripturation. As viewers get sick of paying $38/month to watch “Euphoria,” “Bridgerton,” “Severance,” and “Loki” on four different platforms, some cord-cutters are now becoming subscription-slashers: last quarter, Netflix [reported](https://snacks.robinhood.com/newsletters/1hJKveGEOmvpzuLtfVejiF/articles/43M2Oild3MGMPYMecA8Q7K/) its first loss of subs since 2011. Meanwhile, free ad-supported streaming TV (FAST) options are growing: 

- __Not just Tubi:__ Ad-powered streamers Freevee (owned by __[Amazon](https://robinhood.com/stocks/AMZN)__), Pluto (owned by __[Paramount](https://robinhood.com/stocks/PARA)__), and the Roku Channel have 50M+ active viewers apiece. 
- __Ads = not just a fad:__ By the end of the year, ad-supported streaming is expected to have more viewers than subscription-based streaming.

Couch

__Ad streaming has something for everyone…__ Consumers love the price, advertisers love the targetability, and OG media companies like Fox love the back door into the streaming race. Subscripturation could drive viewers from pricey subscriptions to ad-filled alternatives. That may mean more competition for the Tubis of the world: Disney+ plans to launch an ad-supported tier this year and Netflix is considering doing the same.

Ad-supported streaming services like Tubi are booming as Netflix struggles with subscripturation

Over the past decade, electricity generated from coal in the US has fallen by ~60%

🚙 Lyft vs. Uber

__Stocking up on mini shampoos...__ one bottle = one squeeze. It's hospitality week, with __[Hilton](https://robinhood.com/stocks/HLT)__, __[Marriott](https://robinhood.com/stocks/MAR)__, __[Airbnb](https://robinhood.com/stocks/ABNB)__, __[Booking.com](https://robinhood.com/stocks/BKNG)__, and __[Royal Caribbean](https://robinhood.com/stocks/RCL)__ dropping earnings. First up: __[Expedia](https://robinhood.com/stocks/EXPE)__ [reported](https://d18rn0p25nwr6d.cloudfront.net/CIK-0001324424/5e839e73-0092-4181-826d-c4ec7e10d2d4.pdf) sales were up 81% from last year as bookings reached pandemic-era highs. Ahead of the rest, we're checking in on travel:

- __In the sky:__ TSA traveler [volume](https://www.tsa.gov/coronavirus/passenger-throughput) is almost back to 2019 levels, as you reveal holes in your socks en route to Cabo. __[Delta](https://robinhood.com/stocks/DAL)__ returned to profitability in March, while __[United](https://robinhood.com/stocks/UAL)__ and __[American](https://robinhood.com/stocks/AAL)__ expect to hit green this quarter.
- __On the bed:__ Disappearing mandates, spring-break getaways, and inflated room prices are helping hotels. In March, US hotel profit per available room [reached](https://str.com/press-release/us-hotel-profitability-reached-28-month-high-march) its highest level since 2019.
- __On the card:__ __[Amex](https://robinhood.com/stocks/AXP)__ [saw](https://www.reuters.com/business/finance/amex-profit-tops-estimates-strong-travel-entertainment-spending-2022-04-22/) travel spend more than double last quarter as you swiped for gate-side chardonnay, while __[Mastercard](https://robinhood.com/stocks/MA)__ [said](https://investor.mastercard.com/investor-news/investor-news-details/2022/Mastercard-Incorporated-First-Quarter-2022-Financial-Results-Available-on-Companys-Website/default.aspx) cross-border travel beat 2019 levels for the first time since the pandemic.

__Flying coach to Stagecoach...__ Travel companies are considered "cyclical" because they tend to do well when the economy thrives (and vice versa). ICYMI: the economy isn't exactly crushing it. US GDP shrank last quarter, and global economic growth forecasts have been slashed. Still:

- __Travel-related companies have outperformed__ on earnings [compared](https://snacks.robinhood.com/newsletters/2EW4oQE9seCwZjRIrLhrf1/articles/1HORCQvyyMiNd9v1c8dwpK/) to their cyclical peers (think: tech, banks, construction). 
- __Some travel stocks__ are beating the market. Delta, __[Southwest](https://robinhood.com/stocks/LUV)__, United, and Marriott shares are all up over 5% for the year, while the S&P 500 is down nearly 14%.

Packed week of travel earnings (Peter Dazeley/Getty Images)

Coach

__The vacay rebound doesn’t appear to have peaked yet…__ Unlike the booms experienced by tech and banks last year, travel companies have seen more of a slow-and-steady climb (peppered with Covid-related dips). So far, it looks as if it’s still going, and __[Visa](https://robinhood.com/stocks/V)__ said demand for summer bookings is “very high.” But inflated prices, war, and new Covid outbreaks could threaten the jet-set recovery.

From Delta to Expedia, travel companies are still on the rebound — but the economy isn’t feeling the vacay vibes

__Hold on to your sweatpants…__ Offices are becoming optional. Airbnb has [reversed](https://www.bloomberg.com/news/newsletters/2022-05-02/airbnb-abnb-remote-work-push-is-about-competing-for-talent) its plans to return to offices in September, telling workers they can WFH forever — without pay cuts. It’s a sharp reversal: Airbnb [laid off](https://news.airbnb.com/a-message-from-co-founder-and-ceo-brian-chesky/) a quarter of its workers during lockdowns as travel collapsed. But [*bleisure*](https://snacks.robinhood.com/newsletters/52DNG6pzoXTOUo6SaXM23L/articles/1j1zalFan4ou2Kn1t5pVV7/) (long trips that blend business and leisure) helped business rebound, and now Airbnb wants its 6K+ workers to join in:

- __Bay Area salary…__ but in Belize. Airbnb’s new policy lets workers live and work in 170+ countries for up to 90 days (after that, visas get complicated). The company plans to host quarterly in-person events for workers.

__Return-to-office roulette…__ Pajama-wearing workers have gotten so comfortable WFH that their employers are struggling to get them to return: half of companies [expect](https://www.cnbc.com/2022/03/18/50percent-of-companies-want-workers-back-in-office-5-days-a-week.html) workers back in the office five days a week, but 90%+ of WFH warriors [want](https://news.gallup.com/poll/355907/remote-work-persisting-trending-permanent.aspx) to stay remote. To keep them happy, companies have adopted several return-to-office strategies.

- __Full remote:__ Like Airbnb, __[Zillow](https://robinhood.com/stocks/Z)__ and __Reddit__ [let](https://www.theverge.com/23047593/airbnb-remote-work-no-pay-cuts-location-countries) employees work from anywhere without sacrificing their big-city salaries. 
- __Strings attached:__ Tech giants __[Amazon](https://robinhood.com/stocks/AMZN)__, __[Apple](https://robinhood.com/stocks/AAPL)__, __[Google](https://robinhood.com/stocks/GOOGL)__, __[Meta](https://robinhood.com/stocks/FB)__, and __[Microsoft](https://robinhood.com/stocks/MSFT)__ [require](https://www.theverge.com/23047593/airbnb-remote-work-no-pay-cuts-location-countries) those who ditch cities to take cost-of-living pay cuts. 
- __Office-4-life:__ Meanwhile, __[Netflix](https://robinhood.com/stocks/NFLX)__, __[Bank of America](https://robinhood.com/stocks/BAC)__, and __[Goldman Sachs](https://robinhood.com/stocks/GS)__ are asking (read: begging) their people to come back in.

Nomad

__Work-from-anywhere is the new kombucha on tap…__ a popular perk among workers *and* an important hiring strategy for flexible employers. The option to work from St. Barts for full pay could inspire an applicant to work for Airbnb instead of Apple — a big deal in today’s tight labor market. Airbnb’s CEO, Brian Chesky, said he expects other companies to go remote so that they don’t “limit their talent pool.”

Airbnb lets employees work from anywhere with no pay cut, as the tussle for talent escalates

From Delta to Expedia, vacay companies are still on the rebound despite economic headwinds

The sun makes up 99.8% of the solar system's mass

🏖️ Vacay earnings

__New season dropped...__ We're not talking “Ozark.” Investors have had eagle eyes this earnings season on how corporates are managing a unique economic hot mess (inflation, war, China's Covid crackdown). What we've learned so far:

- __High-growth sectors__ like tech, which thrived mid-rebound, have hit a wall as sales slow, and they’re tightening their belts to prep for more pain. Ditto other "cyclicals" (think: banks, construction), which typically do well when the economy thrives. 
- __"Non-cyclicals"__ — which tend to hold steady regardless of how the economy is doing (think: consumer staples, utilities) — outperformed.
- __In context:__ The World Bank [slashed](https://www.worldbank.org/en/news/speech/2022/04/18/spring-meetings-2022-media-roundtable-opening-remarks-by-world-bank-group-president-david-malpass?cid=ECR_TT_worldbank_EN_EXT) its forecast for global economic growth, US GDP shrank last quarter, and some analysts [warn](https://www.cnn.com/2022/04/26/economy/inflation-recession-economy-deutsche-bank/index.html) a recession’s coming.

__Change is the only constant...__ A year ago, the "Big Tech 5" [demolished](https://snacks.robinhood.com/newsletters/4yfojyZE9WLvdIySo7B6GF/articles/5HHwtkiQ6PZUclm1Kohn61/) earnings with jaw-dropping records. The economy was in full rebound mode and cyclicals were raking it in. Now:

- __Tech:__ __[Amazon](https://robinhood.com/stocks/AMZN)__ had its slowest sales growth since the dot-com bust (the late ’90s), while __[Meta](https://robinhood.com/stocks/FB)__ posted its slowest growth since going public in 2012. __[Google’s](https://robinhood.com/stocks/GOOGL)__ biz is also slowing, while __[Netflix](https://robinhood.com/stocks/NFLX)__ expects to lose millions more subscribers. __[Apple](https://robinhood.com/stocks/AAPL)__ was strong but said chip shortages would [keep](https://www.usatoday.com/story/tech/2022/04/28/apple-earnings-strong-quarter-supply-shortages-covid/9577932002/) slowing its growth. The outlier: __[Microsoft](https://robinhood.com/stocks/MSFT)__ [beat](https://www.cnbc.com/2022/04/26/microsoft-msft-earnings-q3-2022.html) across the board. 
- __Banks:__ From __[Citi](https://robinhood.com/stocks/C)__ to __[Chase](https://robinhood.com/stocks/JPM)__ to __[Goldman](https://robinhood.com/stocks/GS)__, America’s largest banks [reported](https://www.wsj.com/articles/bank-of-americas-quarterly-profit-falls-12-11650280110) double-digit earnings declines as trading and dealmaking slowed.

__Versus…__

- __Staples:__ __[Pepsi](https://robinhood.com/stocks/PEP)__, __[Kraft](https://robinhood.com/stocks/KHC)__, and Oreo maker __[Mondelez](https://robinhood.com/stocks/MDLZ)__ saw strong growth. __[Coke's](https://robinhood.com/stocks/KO)__ sales tripled from last year. __[Procter & Gamble](https://robinhood.com/stocks/PG)__ (Gillette, Tide, Charmin) notched its biggest sales gain in decades.
- __Oil:__ __[Chevron's](https://robinhood.com/stocks/CVX)__ quarterly profit [quadrupled](https://www.cnbc.com/2022/04/29/chevron-cvx-earnings-q1-2022.html) thanks to higher energy prices, while Exxon's nearly [doubled](https://www.cnbc.com/2022/04/29/exxon-xom-earnings-q1-2022.html) despite a big hit from Russia.
- __Pharma:__ __[Merck](https://robinhood.com/stocks/MRK)__ and __[AstraZeneca](https://robinhood.com/stocks/AZN)__ beat expectations as demand [spiked](https://www.cnbc.com/2022/04/28/merck-mrk-earnings-q1-2022.html) for Covid treatments and other key drugs.

The pantry-staple defensive wall (George Frey/Getty Images)

D-Fence

__The market’s getting defensive…__ It used to be “growth at all costs” — now it’s “steady earnings and cut costs.” Amazon, Meta, and Netflix plan to slow investments and be more financially disciplined. Companies and investors are getting used to the “new not normal” environment: persistently high inflation and supply shocks. While the techy Nasdaq just had its worst month since 2008, the pile-on into defensive stocks could continue.

From Amazon to Coke, earnings season underscores a shift to defense as econ gloom grows

__Face-palm…__ Palm oil, which is in [half](https://www.cnn.com/2022/04/26/business/palm-oil-indonesia-export-ban-explainer-intl-hnk/index.html) of your groceries, is about to get pricier. Indonesia, the world’s largest palm-oil producer, [banned](https://www.wsj.com/articles/indonesia-worlds-largest-palm-oil-producer-bans-exports-of-ubiquitous-commodity-11651083436) exports to keep prices in check for local consumers. That’s bad news for __[Hormel](https://robinhood.com/stocks/HRL)__, __[Colgate-Palmolive](https://robinhood.com/stocks/CL)__, and __[Yum! Brands](https://robinhood.com/stocks/YUM)__, who [use](https://www.ourendangeredworld.com/eco/brands-that-use-palm-oil/) palm oil in Skippy peanut butter, toothpaste, and even KFC chicken. Global food supplies were already [strained](https://snacks.robinhood.com/newsletters/4JijOnsDJhfhUOYkjUiBGY/articles/e5pxDFjMCbFJBprP7R7Tq/) by Russia’s war on Ukraine and historic droughts. Now Indonesia’s ban could send record food prices *higher* — especially in poorer countries that depend on palm oil for cooking.

__Don’t forget to call Mom…__ Sunday’s Mother’s Day. For America’s 30M+ working moms, the past two years have been disproportionately hard. Mothers have been more [likely](https://www.census.gov/library/stories/2021/03/moms-work-and-the-pandemic.html) to work in service jobs heavily affected by pandemic closures, and they’ve been [3X](https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2020/09/28/mothers-are-3-times-more-likely-than-fathers-to-have-lost-jobs-in-pandemic) as likely as fathers to lose their jobs early on during lockdowns. Nearly [2M](https://www.shrm.org/resourcesandtools/hr-topics/behavioral-competencies/global-and-cultural-effectiveness/pages/over-1-million-fewer-women-in-labor-force.aspx) women still haven’t returned to the labor force, and economists [aren’t](https://apnews.com/article/coronavirus-pandemic-business-lifestyle-health-careers-075d3b0ab89baffc5e2b9a80e11dcf34) sure how many of them ever will. Those who do face a “[motherhood penalty](https://gap.hks.harvard.edu/getting-job-there-motherhood-penalty)” — a pay gap between moms and non-moms that can be wider than the pay gap between men and women. 


__Big pharma’s vaccine ceiling…__ A year ago, the US was in the thick of the biggest vaccination campaign in history. Now, about two-thirds of the population is fully vaccinated, and Dr. Fauci says we’re “out of the pandemic phase.” __[Pfizer](https://robinhood.com/stocks/PFE)__ and __[Moderna](https://robinhood.com/stocks/MRNA)__, now household names, are looking for their next profit puppies. Pfizer, with a diverse drug portfolio and pipeline, is expecting a $22B boost this year from its Covid antiviral pill, while Moderna is trying to be the first to bring its vax to little kids. We’ll get a checkup on the vax makers’ next bets when both report this week.

__Grab a mint julep and your lucky hat…__ because the Kentucky Derby’s this weekend, and it’s gonna be *packed*. __[Churchill Downs](https://robinhood.com/stocks/CHDN)__, the $8B (valuation) casino biz that runs the iconic horse race, is entering its big weekend feeling lucky: last week it [reported](https://ir.churchilldownsincorporated.com/news-releases/news-release-details/churchill-downs-incorporated-reports-2022-first-quarter-results) record sales and profits for last quarter. Churchill grew its online gambling biz during the pandemic, when IRL betting was restricted. Now that gamblers are returning to the track, business is booming. Churchill expects to post record Derby revenue this weekend as possibly 3X as many fans attend compared with last year.

- __[iConomy](https://snacks.robinhood.com/newsletters/5iXUibAOQoANRr4JnCr1fN/articles/6ZkAZWVU7udnOwo6SwBJKs/):__ __[Apple’s](https://robinhood.com/stocks/AAPL)__ coming off one of its best quarters ever. While supply issues and growth slumps have hurt fellow tech stocks, the Fruit’s been resilient thanks to 5G upgrades and its connected ecosystem of tech and software. 
- __[Contour](https://snacks.robinhood.com/newsletters/5gDfd4oVeIG4SmHI1Vv6Hk/articles/7uygAjOzxBmFflBYmeZsqh/):__ Viral D2C makeup brand __Oddity__ debuted a blockchain-based token that converts into company stock if/when it IPOs. Tokens could be a bridge between the new world of digital assets and OG markets.
- __[Thread](https://snacks.robinhood.com/newsletters/1zpLKuQGHlxnAe3BYLQXii/articles/2igH2dzMBSwHyPrxwOz4J6/):__ Three weeks and $44B after Elon Musk started poking around __[Twitter](https://robinhood.com/stocks/TWTR)__, he’s on the verge of owning the world’s most influential platform. High priority: making the bird app a bastion of free speech.

In the 1800s, ketchup was sold as a cure for indigestion

🛡️ Earnings get defensive

__Isaac Newton would be stumped…__ This __[Apple](https://robinhood.com/stocks/AAPL)__ just doesn’t seem to fall. Yesterday the world’s most valuable company said sales [jumped](https://www.wsj.com/articles/apple-aapl-q2-earnings-report-2022-11651115203?mod=hp_lead_pos2) more than expected last quarter — to $97B — despite ongoing supply issues, the war in Ukraine, and booming inflation. All told, it was Apple’s third-best quarter of *all time*. The details:

- __Booming sales:__ Sales of iPhones, Macs, and other hardware like AirPods all [rose](https://www.cnbc.com/2022/04/28/apple-aapl-earnings-q2-2022.html) more than expected. Sales grew fastest in the services division (think: App Store, iCloud). 
- __Soaring buybacks:__ Apple’s board authorized $90B in stock buybacks, even more than last year. Analysts typically see buybacks as a sign of confidence.

__The post-pandemic slump…__ still hasn’t hit Apple. Apple’s stock is still up more than double since the pandemic began, while fellow stay-at-home surgers Meta, __[Zoom](https://robinhood.com/stocks/ZM)__, __[Peloton](https://robinhood.com/stocks/PTON)__, and __[Netflix](https://robinhood.com/stocks/NFLX)__ have fallen to pre-pandemic levels. But some analysts worried that China’s latest lockdowns would finally put a damper on Apple’s results: 

- __The cause for concern:__ China is critical to Apple’s business: an estimated 20% of iProducts are sold in China and 85% are built there. 
- __Saved by a flexible supply chain:__ Apple’s recent sales didn’t fall. Part of the reason: the Fruit shifted production resources between products to prevent shortages (basically: making more iPhones than iPads when they ran low). 

Can’t stop, won’t stop — selling iPhones (Win McNamee/Getty Images)

Fruit

__Apple isn’t just a company…__ it’s an iConomy. Apple’s worth nearly $3T (or about 2% of the world’s GDP), making it an indicator for the entire global economy. The combo of steady iDemand and Apple’s flexible supply chain offers investors hope that consumers may keep spending despite soaring prices and other economic headwinds.

Apple had one of its best quarters ever, offering hope for the rest of the global economy

__Carvana’s car-vending machine…__ is running out of quarters as the lure of cash-burning used-car companies wears off. Yesterday, private-equity giant __[Apollo](https://robinhood.com/stocks/APO)__ reportedly agreed to buy $1.6B of __[Carvana’s](https://robinhood.com/stocks/CVNA)__ corporate debt (think: investors lend Carvana $$ through bonds, and then get paid with interest). Apollo’s coming to the rescue after Carvana struggled to raise money for an acquisition amid slowing demand for its refurbished cars sold online. 

- __Last quarter:__ Carvana posted its first sales [decline](https://www.wsj.com/articles/carvana-has-big-loss-on-first-sales-decline-11650490974?mod=business_minor_pos15) since going public in 2017 — and it’s expected to lose $800M this year. 
- __Slashing tires:__ In response to supply backlogs and labor shortages, Carvana hiked its car prices and trimmed back on inventory for online shoppers. 

__Your 2018 [Honda](https://robinhood.com/stocks/HMC) Civic…__ is worth more than you think. Used-car sales hit [record](https://www.kbb.com/car-news/despite-soaring-prices-americans-bought-record-number-of-used-cars-in-2021/#:~:text=Americans%20bought%20an%20unprecedented%2040.9,Book%20parent%20company%20Cox%20Automotive.) highs during the pandemic as supply shortages made new wheels hard to come by. Some models were even [selling](https://www.iseecars.com/used-cars-cost-more-than-new-study) for 20% more than their new editions. Carvana made it easy for shoppers to buy online and have their cars delivered, without hassling with a dealership. But as car shopping has become more like house hunting (see: low inventory, high prices), it’s hurting demand — and not just for Carvana: 

- __Rival [Vroom](https://robinhood.com/stocks/VRM) has lost 90%__ of its post-IPO [gains](https://snacks.robinhood.com/newsletters/3zyhoJMmhQdMulq2nhX3S/articles/2ZwTltHV7B5JI4zVAcLeoe/), while used-car OG __[CarMax](https://robinhood.com/stocks/KMX)__ says [shaky](https://www.bloomberg.com/news/articles/2022-04-12/carmax-says-used-car-sales-hit-by-waning-consumer-confidence) consumer confidence is keeping buyers away.

Skid

__The pandemic thriver model is broken…__ and private equity wants to be the glue to fix it. From __[Airbnb](https://robinhood.com/stocks/ABNB)__ to __[Carnival](https://robinhood.com/stocks/CCL)__, PE firms have thrown lifelines to numerous companies needing quick cash to combat pandemic-fueled losses. In turn, firms like Apollo guarantee dividends for investors and a big payout down the road. It’s worked before: Apollo's fund jumped 10% after __[Hertz](https://robinhood.com/stocks/HTZ)__ paid [back](https://www.bloomberg.com/news/articles/2022-01-14/apollo-credit-fund-notches-double-digit-gain-for-2021-on-hertz) part of a $1.5B loan less than a year after getting it. 

Carvana gets help from private equity as the used-car biz stalls out

Apple dodges supply headaches to post one of its best quarters ever

Last quarter Apple made an average of $13K every second of each business day