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| Hello Insiders!! Today's Business newsletter covers: - 💊 Weight loss drug disrupts businesses
- 🎁 Deep Dive: Holiday Shipping Discounts
- 🍻 Modelo boosts Constellation Brands' earnings
If you enjoy reading this newsletter, please share it with your friends and colleagues. Make sure to continue reading the Quarterly Earnings Report and the Quick Hits. Thank you!! Shriram
p/Shriram | |
| 1 | | Organizations like Walmart and Conagra Brands are assessing the effects of appetite suppressants like Ozempic and Mounjaro on consumer behavior and business strategies. The rapid growth in sales of these weight-loss medications has businesses worried about adjusting to the shifting market. More: - John Furner, CEO of Walmart, acknowledged a "slight pullback" in food purchases due to the medications but said it's too early to draw any firm conclusions.
- Businesses are looking into the scientific potential of these therapies as more recent medications like Wegovy and Mounjaro show promise beyond treating diabetes and obesity.
- The Atkins Diet and the 1990s' olestra fad provide lessons on the potential whipsaw effect of such movements.
- Over 40% of GLP-1 users who responded to a poll said they ate out less, and nearly 70% said they ate less overall.
- Companies must analyze changing data to develop the best business strategy in reaction to the effects of these treatments.
Q: Which industries or businesses are most vulnerable to disruption by weight loss drugs? Join the conversation here. |     | |
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What the numbers say: Parcel carriers like UPS and FedEx are bracing for a lackluster holiday shipping season, expecting to handle 82 million parcels daily during the peak, down from 90 million last year. Rates for containerships and trucking have also decreased, leading to heightened competition for UPS and FedEx compared to the previous year. Relevance: The slowdown in demand for goods affects the global supply chain and various industries. Because there is less demand for shipping, carriers provide discounts and cost relief to clients. More data: Demand for consumer items like clothing, electronics, and consumer goods is declining, while regional carriers like Amazon Shipping, UPS, and FedEx are becoming more competitive with one another in the shipping business. Due to its cost-effectiveness and lack of holiday surcharges, the U.S. Postal Service is seeing an increase in parcel volume as customers deliberately switch carriers to take advantage of lower rates. | | | |
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| 3 | | Constellation Brands outperformed analyst forecasts in Q2 fiscal 2024, with robust beer sales driving double-digit growth, while wine and spirits sales were less impressive. The Modelo brand family, especially the Modelo Especial (9%) and Modelo Chelada (40%), played a pivotal role in the beer division's success, maintaining its position as the leading brand in the U.S. beer category. More: - Earnings per share came in at $3.70, exceeding forecasts of $3.36, and revenue came in at $2.84B, exceeding projections of $2.82B just barely.
- Constellation Brands increased its forecast for fiscal 2024 earnings per share from a prior range of $9.35 to $9.65 to a range of $9.60 to $9.80.
- Sales of wine and spirits dropped by 14%, and depletions fell by over 8%.
- Meiomi (7% depletion growth), Kim Crawford wines (6% depletion growth), and Mi Campo Tequila (60% depletion growth) were among the division's notable brands for wine and beverages.
- The business expects pricing rises and a rise in direct-to-consumer channels to benefit its wine and spirits division.
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| 4 | | Amazon has successfully deployed its initial two satellites, KuiperSat-1 and KuiperSat-2, as part of Project Kuiper's plan to establish a vast satellite network for global internet access. The launch utilized an Atlas V rocket from United Launch Alliance LLC and served as a test to showcase the transmission and reception of broadband signals. More: - Project Kuiper intends to launch 3,326 satellites into low Earth orbit to offer broadband internet access.
- Amazon's launch for Project Kuiper had significant delays, with the original launch date a year ago utilizing a different rocket.
- Utilizing the Atlas V rocket, capable of launching up to 44,000 pounds of cargo into low-Earth orbit, was a tactical decision to speed up the satellite deployment.
- By 2026, Amazon must launch the Kuiper constellation's first half to comply with its FCC license's terms.
- Since each of the test satellites weighs only between 1,300 and 1,550 pounds, it was imperative to choose a launch vehicle that would be feasible.
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| 6 | | Stoke Space, a startup based in Kent, Washington, has raised $100M in funding to advance its fully reusable rocket project named "Nova." Industrious Ventures led the investment round, and Steve Angel, Linde's chairman, has joined Stoke's board of directors, while other contributors include the University of Michigan, Sparta Group, Long Journey, Bill Gates' Breakthrough Energy, and YCombinator. More: - Having raised $75M since its founding in 2019, Stoke completed a successful low-altitude flight test of its "Hopper2" prototype rocket.
- The Nova rocket is designed to launch 5,000 kilograms into low Earth orbit as a "medium" class rocket.
- Unlike several rivals, Stoke is building its rocket's second stage before the first stage.
- Stoke co-founder and CEO Andy Lapsa stated that the focus is on sustaining rapid development to quickly enter the market and strengthen the still-vulnerable commercial space economy.
- Stoke is preparing for orbital testing, increasing its facilities, and employs 95 people.
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- HSBC is acquiring Citi's $3.6B China retail assets as part of its Asia-focused strategy amid challenges in China's economy.
- Colombian entrepreneur Jaime Gilinski Bacal has taken control of Metro Bank through a $396M rescue deal, consisting of $183M in equity and $213M in debt from investors.
- Streaming platforms, including TelevisaUnivision, Canela Media, Telemundo, ESPN+, and Prime Video, are aggressively pursuing Spanish-language sports rights to cater to Hispanic viewers, a pivotal demographic in the cord-cutting trend and streaming expansion.
- The Arizona Coyotes have inked a deal with E.W. Scripps Company to broadcast their local games on free over-the-air networks, replacing their previous agreement with Bally Sports Arizona, which is now defunct due to bankruptcy issues.
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INSIDE BUSINESS LEADERBOARD (7 DAYS) |
 | Freelance Writer | | Shriram is pursuing Master’s in Business with Marketing at Warwick Business School. He worked as a Senior Consultant in Tech and Political Consultancies before his Masters. He is passionate about Tech, Marketing, Strategy, Anthropology and Politics. He is also the Postgraduate Ambassador for Warwick Business School. | | This newsletter was edited by Aaron Crutchfield | |
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