(Lars Hagberg/Getty Images) |
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Chuck E. Cheese is entering the subscription game with a membership priced between $8 and $30/month. Sadly, its animatronic band broke up before it could see a kickback.
Tech led the market’s rally yesterday with the S&P 500 notching its biggest four-day gain of the year. Investors cheered cooler-than-expected wholesale prices. Today, all eyes are on July’s consumer-inflation report, which could influence the Fed’s September rate decision. |
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Canary in the coin mine… Hut 8, one of the largest bitcoin miners in North America, saw its shares slip yesterday after it reported disappointing earnings. The biz lost nearly $72M in the second quarter compared to a $251M Q1 profit. Most of the loss came from an accounting-rule change requiring companies to reflect crypto’s market price on their balance sheets (think: unrealized gains or losses). While BTC is down from its March high of $73K+, Hut 8’s sagging crypto output also hurt its earnings. It produced just 279 BTC in Q2, down from 740 on the year. Cue the finger-pointing at April’s “halving”…
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- Zeno’s profits: About every four years, the amount of bitcoin miners earn for generating a block is cut in half. The change is programmed into the OG crypto’s code, and it can hit miners’ revenues hard.
- To a trickle: This reward reduction (aka the halving) steadily decreases the rate at which new BTC is born. FYI: the total max supply = 21M coins, and 94% has already been mined.
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Earnings on the mine… Hut 8 isn’t the only bitcoin biz facing a profit problem. This month Marathon Digital, the world’s largest bitcoin miner, reported that its losses also widened. The stock’s down 32% this year. Fellow miners Riot Platforms, CleanSpark, and Core Scientific also reported big losses. Plus, bitcoin’s hash rate — a measure of how difficult it is to mine one block — hit a record high last month. Hut 8 said the cost to mine one BTC at its facilities (picture: walls of servers and cooling fans) nearly doubled on the year to $26K.
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Invest in your future self… Despite sagging profit, mining cos look to be doubling down. Hut 8 said now is the time to spend $$ to upgrade to more energy-efficient equipment, and some miners are eyeing mergers and AI pivots as a path to profitability. Meantime, Marathon Digital last month said that it’d purchased $100M worth of bitcoin, and it’s seeking to raise $250M in part to buy more. If BTC has a rally, those investments could boost its balance sheet.
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Blue bird goes red… After some technical difficulties, about 1.3M X users tuned in Monday for CEO Elon Musk’s interview with former POTUS Donald Trump. Musk is increasingly using his account (X’s most popular with ~194M followers) to support the presidential candidate. Close to a fifth of Musk’s tweets this year have been political, WaPo reported. Trump made a flurry of X posts this week, returning to the platform for the first time in nearly a year. (Previously he mostly stuck to his own floundering platform, Truth Social.) X’s politically active week has attracted criticism.
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- Flagged: The European Commission said Monday that X could be penalized and restricted if it fails to prevent incitements to violence or hate speech, including in “debates and interviews in the context of elections.”
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Soundbite: The United Auto Workers union filed unfair labor charges against Tesla CEO Musk and Trump after the duo’s chat, which included comments about firing workers who threaten to strike.
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Pickin’ lanes… Advertisers have pulled money from X en masse over content concerns, and other social platforms may be trying to avoid the drama. Meta restricted political content across Instagram and Threads in February, deprioritizing its place in users’ feeds. Boss Mark Zuckerberg hasn’t endorsed a 2024 candidate, saying he doesn’t plan to play a “significant role” in the election. Snap (where Trump’s still barred, unlike on most other platforms) hosts political news and ads from both sides and lets users register to vote in the app. TikTok, which is full of political vids, has been accused of not doing enough to prevent misinfo.
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Politics is risky business… Musk is the only Fortune 100 CEO formally endorsing a political candidate this election season. And only a couple of the top 100 CEOs have personally donated to candidates. With Americans so divided along political lines, Musk’s vocal election push could alienate X users and advertisers while threatening his other businesses like Tesla. But it could win his companies some executive goodwill if Trump’s reelected.
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JetBlue needs to refinance its debt, and it might pledge its frequent-flyer program to secure the loan. Read More. |
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Poached: Starbucks named its new CEO: Chipotle’s CEO. The coffee giant’s hoping that burrito boss Brian Niccol can foam up its sales, which have fallen in the past two quarters.
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DI-why: Home Depot slashed its annual sales forecast, blaming weaker spending on large home-remodeling projects. The retailer’s big-ticket transactions ($1K+) were down about 6% from last year.
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Quote: Healthcare startup Ro launched an insurance-coverage checker for patients looking to get pricey GLP-1 drugs like Ozempic. Most plans cover GLP-1s for diabetes, but fewer do for weight loss.
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Basket: Meal-kit delivery Hello Fresh cooked up a Q2 earnings beat yesterday. Growth was fueled by its ready-to-eat-meal biz, which saw a 50% sales jump in the first half of the year.
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Port: Walmart opened its ocean-shipping network to its sellers looking to send China-made products to the US. Amazon’s also launching a direct-from-China service as Temu and Shein push up air-cargo rates.
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Consumer-inflation report for July
- National Financial Awareness Day
- Earnings expected from UBS, Dole, Performance Food Group, and Cisco Systems
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Authors of this Snacks own bitcoin and shares of: Amazon, Riot Platforms, Walmart, Tesla, Snap, Starbucks, and Yum Brands |
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Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate... See more |
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