📡 Starlink’s subsidy snafu

…and Six Flags takes a premium-ization plunge [Disclosures](   A satellite snafu (Joan Cros/NurPhoto via Getty Images)   Yesterday’s Market Moves   Dow Jones 33,337 (+0.08%) S&P 500 4,207 (-0.07%) Nasdaq 12,780 (-0.58%) Bitcoin $24,192 (+1.01%) Dow Jones 33,337 (+0.08%) S&P 500 4,207 (-0.07%) Nasdaq 12,780 (-0.58%) Bitcoin $24,192 (+1.01%) Hey Snackers, Barns are the new condos: farm-style “[barndominiums]( are popping up across the US as a more affordable (and spacious) alternative to traditional homes. Farm animals not included. Stocks dipped slightly yesterday as investors digested cooling inflation #s. Another encouraging signal: wholesale prices [fell]( last month for the first time in two years thanks to sliding energy prices. Bars Space's Starlink loses $886M in government funding because even satellite internet can’t fix America’s WiFi problem Back down to Earth... Regulators are pulling the plug on an $886M [subsidy]( for SpaceX's Starlink after the satellite-internet biz failed to reach America’s most isolated areas. ICYMI: the FCC dished out over $9B worth of subsidies to broadband providers in 2020 to help connect millions of remote households and small businesses (see: [Rural Digital Opportunity Fund](. Now: - The deal: Starlink was originally awarded $886M over 10 years (one of the largest FCC grants) in hopes of [becoming]( a one-stop internet shop for rural areas. But its high-speed service has slowed from Q4 of last year to now. - The fallout: Regulators nixed the award Wednesday, blaming Starlink's “still developing” tech and pricey subscription for the reversal. - The status: Starlink has nearly 2K low-Earth-orbiting satellites providing internet to 400K+ people worldwide. The basic service costs $110/month, plus a one-time $600 satellite fee. America’s digital divide… is growing wider. About 21M Americans — or 1 in 15 people — still don’t have access to high-speed internet. It’s worse in rural areas (think: small towns, farmlands) where more than half of residents have bad service. Some families have had to sit in parking lots to do remote work, job search, and attend online classes. The FCC’s subsidies could help with that: - OG internet provider [Charter]( received $1.2B in government subsidies and is investing an additional $3.8B of its own money to expand its broadband network in 23 states. THE TAKEAWAY A public-sector failure could affect private funding... SpaceX has raised more than $2B this year, but funds are shared with its pricey next-gen rocket projects. Musk has already delayed Starlink’s IPO twice. And if it can’t meet the government’s expectations, private investors might lose confidence too. Plunge Six Flags shares plunge as attendance falls, but its premium-ization strategy is (kind of) working This year’s been a roller coaster… and [Six Flags]( is starting to feel queasy. Yesterday, shares of the theme-park giant plunged 18% after the biz [reported]( a 22% drop in attendance last quarter compared to last year. While Six Flags’ attendance is 35% below prepandemic levels, [Disney’s]( US theme-park visitors have rebounded. - Off theme: Unlike Six Flags, Disney, [SeaWorld]( and [Cedar Fair]( all posted record theme-park sales last quarter, thanks to rising prices and eagerly returning visitors. - A big drop: Six Flags’ quarterly sales fell 5% from last year, though spending per visitor jumped. Meanwhile, Disney’s parks reported a whopping 72% increase. More like Five Flags… Actually, Six Flags got what it wanted: fewer visitors. It had recently hiked prices to reduce the number of people in its parks and improve the “guest experience.” Read: fewer visitors, but ones who spend more. The strategy seems to have worked too well: - Higher rollers: Six Flags wants to boost sales while limiting visitors. Fewer people = happier visitors + lower costs. - They wanted a drop… but not that big a drop. The Flags’ CEO said attendance numbers were 10%+ lower than targeted. - The ride’s not over: Six Flags visitor spending jumped 23% last quarter, and it's up 50% from prepandemic levels (think: pricier tix + more merch and food sales). THE TAKEAWAY You can’t crank the dial too fast… Six Flags may have “premium-ized” too aggressively during a tough economic time. It successfully pushed customers to spend more at its parks. But it hiked prices so fast that it caused its attendance levels to nosedive faster than a roller coaster. Still, the CEO says he’s confident the company will see a “long-term benefit” from its premium-ization strategy. What else we're Snackin' - [Percy]( Quirky glasses seller [Warby Parker]( slashed its sales forecast for the year despite reporting a smaller-than-expected quarterly loss. Retailers have been growing more cautious as the econ outlook gets foggy. - [Pills]( [Walgreens]( is offering pharmacists signing bonuses of up to $75K to attract healthcare professionals during a worker shortage that’s led to lower drug sales and overworked employees. - [Breathe]( Selena Gomez’s “mental fitness” startup, Wondermind, raised $5M at a $100M valuation in a round led by Serena Williams’ VC firm. Mental-health startups have seen a boom in funding since the pandemic. - [Coin]( Investment titan [BlackRock]( is offering direct [bitcoin]( exposure to institutional clients (think: funds, banks). Despite crypto’s fall, BR said institutionals are expressing “substantial” crypto interest. - [Extra]( [New York Times]( shares jumped almost 11% after activist investor ValueAct disclosed a nearly 7% stake in the media company. ValueAct reportedly wants NYT to focus on expanding subscriber-only bundles. 🍪 Thanks for Snacking with us! Want to share the Snacks? Invite your friends to sign up [here](. Snack Fact Of the Day Last month the average rent for a Manhattan apartment hit a record $5.1K [Read more]( Friday - Earnings expected from Spectrum Brands Authors of this Snacks own: bitcoin and shares of New York Times and Disney ID: 2350931 Robinhood Snacks newsletters 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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