| Here’s your daily business briefing. - 🔧 Lowe’s beats forecasts amid DIY spending dip
- 🔍 Deep Dive: U.S. tariff hikes drive Vietnam imports
- 🛍️ Macy's exceeds earnings, turnaround progress
Thanks for reading! Shriram
p/Shriram | |
| 1 | | Lowe's ($LOW) exceeded first-quarter earnings and revenue expectations, although experiencing a year-over-year sales decrease, primarily due to fewer high-ticket purchases by DIY customers. The company maintained its full-year forecast, anticipating total sales of $84B to $85B, with comparable sales expected to decline between 2% and 3%. More: - First-quarter earnings per share stood at $3.06, surpassing the anticipated $2.94, with revenue hitting $21.36B, exceeding the expected $21.12B.
- Quarterly net income fell to $1.76B, down from $2.26B in the year's corresponding period.
- The American retail company has encountered five consecutive quarters of year-over-year sales decline.
- While Lowe's attracts fewer professional customers than Home Depot, it has been concentrating on expanding its professional customer base.
- Despite difficulties, Lowe's stock has risen by 3% this year, lagging behind the 11% gains of the S&P 500.
|     | |
| 2 | | 
What the numbers say: Last year, U.S. imports from Vietnam doubled to $114B, with Vietnam's trade surplus nearing $105B in 2022, reflecting a 2.5-fold increase since 2018. Vietnam's exports to the U.S. heavily rely on imports from China, constituting about 80% of its electronics exports, while U.S. imports from Vietnam in Q1 2023 amounted to $29B, slightly lower than Vietnam's imports from China at $30.5B. Relevance: The rise in U.S. imports from Vietnam reflects shifting trade dynamics as firms diversify from China amidst tariffs and geopolitical tensions. Vietnam's reliance on Chinese components for U.S. exports suggests a strategy to bypass tariffs, indicating a complex supply chain where Vietnam acts as a conduit for Chinese goods entering the U.S. market, making it a key player in U.S. trade policy and human rights considerations. More data: Vietnam's surge in U.S. imports has notably reduced its reliance on Chinese goods, accounting for over half of the $110B decline in U.S. imports from China since 2018. In key sectors like textiles and electronics, Vietnam has captured over 60% of China's lost market share in the U.S., with about 90% of intermediate goods imported by Vietnam's industries being used for exports. | | | |
| A message from our sponsor, OUR SPONSOR. |  | | Join industry’s leading AI conference - free passes available! Ai4 2024 is the world’s leading gathering of artificial intelligence leaders in business. Jump on the opportunity to join… - 4500+ attendees
- 350+ speakers
- 150+ AI exhibitors
- 75+ countries
Act fast - passes are selling quickly. Don’t miss out on the epicenter of AI innovation. See the full agenda here.
Register Now | |
|
| 3 | | Macy's ($M) exceeded earnings estimates with adjusted earnings per share of $0.27 versus the expected $0.15, and revenue of $4.85B, close to the expected $4.86B. First-quarter net income dropped 60% to $62M, or $0.22 per share, from $155M, or $0.56 per share, a year ago. More: - Macy's raised its full-year forecast, expecting net sales between $22.3B and $22.9B, with adjusted earnings per share of $2.55 to $2.90.
- The American department store chain plans to close 150 stores but will invest in the remaining ones, with the first 50 seeing a 3.4% rise in comparable sales.
- Bloomingdale's and Bluemercury maintained strong performance, with Bluemercury's comparable sales up by 4.3% and Bloomingdale's increasing by 0.3% on an owned-plus-licensed basis.
- Macy's is challenged by activist investors and a competitive market, evident in its stock's 5% decline this year.
| | | |
| 4 | | Nestlé is launching Vital Pursuit, a line of 12 portion-controlled frozen meals designed for people on GLP-1 weight loss drugs like Ozempic and Wegovy, priced at $4.99 or less. J.P. Morgan predicts the obesity medication market will reach $100B, with 9% of the U.S. population using weight-loss drugs by 2030. More: - Vital Pursuit offers nutrient-rich options like sandwich melts, pizzas, and bowls to address nutritional gaps from reduced food intake.
- Other companies, like GNC and Costco, target GLP-1 users with dedicated supplement sections and Ozempic offerings.
- WeightWatchers launched a membership plan for GLP-1 medication access and acquired the telehealth business Sequence for $100M.
- J.P. Morgan's report reveals that GLP-1 drug users purchase about 8% less food, including snacks and high-carb products, than non-users.
- Another recent study revealed that GLP-1 drugs notably decrease heart risk and contribute to sustained weight loss for up to 208 weeks.
| | | |
| 5 | | Microsoft ($MSFT) announced new Surface PCs with Qualcomm chips for efficient AI features and longer battery life, with similar models from Lenovo, Dell, HP, Asus, Acer, and Samsung. Copilot+ PCs, starting at $999 and using AMD and Intel chips, are available for pre-order now and will be released in June. More: - The Recall feature enables offline searches of previous actions on PCs, keeping data on the device.
- These PCs' AI models can generate images from descriptions and drawings, translate audio, and suggest responses.
- Microsoft plans to bolster its Windows franchise using energy-efficient Qualcomm Arm-based chips to counter Apple's market share gains with Arm-based MacBooks.
- Following the announcement, Microsoft shares rose 1.2% to $425.34, and Qualcomm ($QCOM) shares hit a record $197.76, up 2%.
| | | |
| 6 | | Target ($TGT) has slashed prices on over 1,500 popular items and plans further reductions on 5,000 items by summer, aiming to entice inflation-weary shoppers and boost spending. These cuts are expected to save millions collectively on household staples, with examples like Clorox wipes dropping from $5.79 to $4.99 and Target's Good & Gather unsalted butter from $3.99 to $3.79. More: - Retailers like Ikea and Aldi have been cutting prices due to a consumer spending pullback amid inflation.
- According to the Commerce Department, retail sales growth has been hampered by high prices, remaining unchanged from March.
- Target experienced its first sales decline since 2016 last year and anticipates a sluggish 2024 ahead.
- In response to declining sales, Target introduced a new house brand called Dealworthy, featuring budget-friendly products such as phone chargers and disposable plates.
| | | |
| 7 | | Quick Hits: *This is a sponsored listing. | | | |
| Upcoming Events | * This is a sponsored event | | | |
 | 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 Shriram Jeevakumar | |
| |
 | Apply today for a complimentary pass or register now for 41% off final prices. | |
|
| |
