Hey Friends,
Earnings reporting season for the big companies in the S&P 500 is in its tail end, but the majority of retail is set to begin reporting in the next few weeks. We will be providing a full earnings summary in the upcoming weeks. While I don’t expect any retailers to have an Nvidia moment, I am somewhat optimistic….
Walmart agreed to acquire smart TV maker Vizio for $2.3 billion, in a deal aimed to boost the retail giant's ad business. The Vizio deal will help fuel Walmart's ad business, which grew 28% to $3.4 billion last year. To put this in perspective, according to Insider Intelligence, Amazon controlled 75.2% of the $45.15 billion U.S. retail media ad market in 2023 and invested heavily in growing its demand-side ad platform, which includes streaming TV ads in Prime Video and Freevee. This acquisition is set to bring the user base and benefits of the Vizio smart operating system, SmartCast, to the Walmart Connect platform. Since 2018, SmartCast has grown over 400% and amassed over 18 million active users.
Walmart announced that it will conduct a split of its outstanding shares of common stock at a ratio of 3:1. The stock split is part of Walmart’s ongoing review of optimal trading and spread levels and its desire for its associates to feel that purchasing shares is easily within reach.
Walmart CEO Doug McMillon also announced on their latest earnings call that Walmart supply chain cut 1 billion tons of emissions 6 years ahead of schedule.
Amazon will join the exclusive “club” of 30 companies that make up the Dow Jones Industrial Average (DJIA), replacing Walgreens Boots Alliance, due to it’s impact on both US and Intl. market. Additionally, Uber has been added to the Dow Jones Transportation Average, driving out JetBlue Airways. Both changes will be effective prior to the opening of trading on Feb. 26, 2024.
According to the Wall Street Journal, Express Inc. is restructuring it’s debt and may file for bankruptcy. While net sales grew 5% to $454 million in Q3 they reported an operating loss of $28.7 million and a net loss of $36.8 million. The retailer reported $274.7 million in debt in the third fiscal quarter of 2023, as brought on by efforts to “strengthen their liquidity” according to former CFO Jason Judd.
Target announces a new collaboration, this time partnering with Diane von Furstenberg. According to the announcement, more than 200-piece assortment will span women's, girls' and baby apparel and accessories, plus beauty and home decor, starting at $4, with most items under $50. Also new for Target's limited-time only collaborations, the collection will offer made-to-order furniture starting at $300.
BowFlex, once a pioneer in the fitness industry, said in a filing the company has serious doubts it can remain afloat. The company experienced a net loss of $34.3 million, in the third quarter of 2023. Overall, for the first three quarters of 2023, the company reported a loss of $51.8 million.
Shopify, the Canadian platform for developing and maintaining e-commerce platforms had a 26% increase in revenue, reaching US $ 7.1 billion, while profits increased by 28 per cent to US $ 3.5 billion. The sales volume of Shopify-managed e-commerce platforms climbed by 20% during the year, reaching $235 billion, representing $38.7 billion gain over the previous year. Shopify claims that its solutions account for 10% of internet commerce in the United States, and that success is driven by the ability to “build fast, reliable, and unified solutions for merchants of all sizes.”
For some recent retail statistics…..Momentum Commerce, a modern digital retail consultancy, announced new monthly revenue forecasts across Amazon US and hundreds of Amazon categories. The latest model estimates Amazon US retail sales to arrive at $641.3 billion in 2024, an increase of 19.9% or $106.6 billion YoY.
To finish with some updates from our friends up north…..Canada's December retail sales slightly beat expectations as consumers prioritized cars, food, beverages, and supermarkets during the holiday season, but are showing a likely decline to the start the year. Retail sales grew by 0.9% in December from November, more than an original forecast of 0.8%. January's preliminary estimate pointed to a 0.4% decline on the month.
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