👟 Allbirds’ woolly earnings

…and the UK orders Facebook to dump Giphy [Disclosures](   Eucalyptus-pulp shoes in the wild [Gary John Norman/ The Image Bank via Getty Images]   Yesterday’s Market Moves   Dow Jones 34,484 (-1.86%) S&P 500 4,567 (-1.90%) Nasdaq 15,538 (-1.55%) Bitcoin $57,167 (-1.23%) Dow Jones 34,484 (-1.86%) S&P 500 4,567 (-1.90%) Nasdaq 15,538 (-1.55%) Bitcoin $57,167 (-1.23%) Hey Snackers, Shine bright like a republic: The Caribbean island of Barbados has [removed]( Queen Elizabeth II as its head of state. Rihanna, who hails from the former British colony, attended a grand ceremony to celebrate the new republic — and was named its 11th national hero. Stocks plunged yesterday after Fed Chair Jerome Powell [said]( higher inflation could be coming in the wake of the Omicron variant. He said the central bank might consider ending its economy-boosting bond-buying program sooner than expected. Popcorn UK regulators ordered Facebook to sell Giphy — and it could set a powerful precedent Time to fire up the popcorn.gif… [Facebook’s]( purchase of Giphy is turning into a [thriller](. Yesterday the UK’s antitrust regulator [ordered]( Meta (formerly Facebook) to sell Giphy, the GIF-sharing platform that FB [acquired]( last year for $315M. Refresher: Giphy doesn't own the rights to the vids used in GIFs, so it made money by showing sponsored results to searches (you search "glow up" and get a glossy mouth with Maybelline branding). - 2 whammies: Regulators say the merger reduced ad competition by killing Giphy’s ad service in the US and hurt social competition by giving Meta control over [Snap]( [Twitter]( and TikTok’s access to GIFs. - 4 options: Meta can appeal, sell Giphy, leave the UK, or get fined. The UK already fined Meta $70M for failing to cooperate with the investigation. The social giant said it’s considering an appeal. Zuck never Meta tougher regulator… The company formerly known as Facebook has received plenty of antitrust criticism before, but this lawsuit is unprecedented because it involves a UK regulator trying to break up a completed tech merger between American companies. Still, global regulators have targeted US tech giants before. A few examples: - London regulators ordered [Uber]( to shut down in 2019, but Uber won the legal battle. - Australia passed a law to make Facebook and [Google]( pay for news content, and both eventually struck deals with Aussie media companies after getting the legislation amended. Oz is expected to announce a new inquiry into Big Tech companies today. THE TAKEAWAY Precedent is powerful… Since Meta faces ongoing antitrust lawsuits worldwide, regulators will be watching its every move. If Meta doesn’t appeal, other regulators may be emboldened to crack down too. President Biden has appointed several regulators in the past year — like FTC Chair Lina Khan — who can’t wait to challenge monopolistic practices at Meta, Google, [Apple]( and [Amazon](. Meta doesn’t want to set a precedent that could break up its biz, so it may take extra care to guard its GIFs. Woolly Eco-friendly shoemaker Allbirds posts strong sales for its first-ever earnings — but needs a bigger fan base to potentially turn a profit Wool shoes and hydro flasks… Throw in a Patagonia, and you’ve got yourself a tech uniform. [Allbirds’]( eco-friendly shoes have become a Silicon Valley staple. Think: $98 kicks made from wool, sugarcane, and South African eucalyptus pulp. Shares of the direct-to-consumer company have fallen 33% since going public last month. Allbirds’ first public earnings report didn’t wow investors, and the stock dropped 6% after hours. - Step up: Allbirds' quarterly sales [rose]( 33%, to $63M, thanks to strong demand for its new athleisure clothing line and fresh sneaker styles (like limited-edition Runner Fluffs). - Step down: Allbirds’ loss nearly doubled from last year, to $14M, as it splurged to expand its brick-and-mortar stores to 31 locations. Plastic-bottle shoestrings… and carbon-negative soles. Allbirds has put sustainability at the center of its business, attracting eco-conscious Zillennials. While the average pair of sneakers creates 12 kilograms of CO2 emissions, Allbirds claims its shoes produce only 7. Its ESG pledges include creating 100% renewable energy for its production facilities by 2025. - Younger consumers are almost 2X as likely to consider ESG issues when making purchasing decisions, compared to consumers over the age of 38. - That’s why companies like [Beyond Meat]( Patagonia, Tom’s, and Allbirds have put eco-friendly messaging and materials at their core. THE TAKEAWAY Brand love doesn’t equal brand permanence… Last year, more than half of Allbirds' sales were from repeat customers. But since its expenses are growing along with losses, it may need to grow beyond that core audience to survive long term. Values-driven companies like Impossible Foods and Beyond Meat have seen sales slump recently, and even OG sustainable shoe brand Toms has had to revamp its image to broaden its appeal. What else we're Snackin' - [Cron]( While scientists race to understand Omicron’s threat, vax leaders are sharing early predictions: The creator of [Pfizer’s]( Covid vax said Omicron is unlikely to cause severe illness in vaxxed people, while [Moderna’s]( CEO said it could make shots much less effective. - [Pillin]( An FDA advisory panel narrowly endorsed the use of [Merck’s]( Covid-treatment pill, despite unanswered questions over its effectiveness and safety. - [DeTweet]( [Twitter]( said it won’t allow users to share non-public photos or videos of other people without their consent. - [Cryptic]( Following reports that India would ban all private cryptocurrencies, the country clarified that it’s closely monitoring crypto ads — not weighing a ban (for now). - [Cloudy]( [Amazon’s AWS]( aka the world’s biggest cloud provider, launched new chips to help customers beat the cost of computing chips from [Intel]( and [Nvidia](. - [Musky]( Elon told SpaceX employees that the lack of progress made in developing Raptor rocket engines has created a “genuine risk of bankruptcy.” 🍪 Thanks for Snacking with us! Want to share the Snacks? Invite your friends to sign up [here](. The Snacks Daily Podcast As if soaring gas prices weren’t enough, coal prices have hit their highest levels in more than a decade. That could make it difficult for some Americans to warm their homes this winter. [Tune in]( to hear why an insurance company wants to end coal. Snack Fact Of the Day [Cyber Monday sales fell for the first time ever, dropping 1.4% from last year, as early deals pulled sales forward]( Wednesday - Earnings expected from: Snowflake, CrowdStrike, Okta, Build-A-Bear Workshop, and Royal Bank of Canada Authors of this Snacks own shares of: Google, Twitter, Apple, Uber, Snap, Pfizer, Amazon, and Moderna ID: 1941041 Robinhood Snacks newsletters and podcasts reflect the opinions of only the authors who are associated persons of Robinhood Financial LLC (Member [SIPC]( and do not reflect the views of Robinhood Markets, Inc. or any of its subsidiaries or affiliates. 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