JERICHO, N.Y.–(BUSINESS WIRE)– 1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS) (the “Company”),a leading provider of gifts designed to help inspire customers to give more, connect more, and build more and better relationships, today announced that the Company will release financial results for its fiscal 2025 second quarter on Thursday, January 30, 2025. The press release will be issued prior to market opening and will be followed by a conference call with members of senior management at 8:00 a.m. (ET).
The conference call will be available via live webcast from the Investors section of the Company’s website at www.1800flowersinc.com/investors. A recording of the call will be posted on the website within two hours of the call’s completion. A telephonic replay of the call can be accessed beginning at 2:00 p.m. (ET) on January 30, 2025, through February 6, 2025, at: (US) 1-877-344-7529; (Canada) 855-669-9658; (International) 1-412-317-0088; enter conference ID: #4981439.
Special Note Regarding Forward-Looking Statements:
Some of the statements contained in the Company’s scheduled Thursday, January 30, 2025, press release and conference call regarding its results for its fiscal 2025 second quarter, other than statements of historical fact, may be forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the applicable statements. For a more detailed description of these and other risk factors, please refer to the Company’s SEC filings including its Annual Reports and Forms 10K and 10Q available at the Investor Relations section of the Company’s website at 1800flowersinc.com. The Company expressly disclaims any intent or obligation to update any of the forward-looking statements made in the scheduled conference call and any recordings thereof, or in any of its SEC filings, except as may be otherwise stated by the Company.
About 1-800-FLOWERS.COM, Inc.
1-800-FLOWERS.COM, Inc. is a leading provider of gifts designed to help inspire customers to give more, connect more, and build more and better relationships. The Company’s e-commerce business platform features an all-star family of brands, including: 1-800-Flowers.com®, 1-800-Baskets.com®, Cheryl’s Cookies®, Harry & David®, PersonalizationMall.com®, Shari’s Berries®, FruitBouquets.com®, Things Remembered®, Moose Munch®, The Popcorn Factory®, Wolferman’s Bakery®, Vital Choice®, Simply Chocolate® and Scharffen Berger®. Through the Celebrations Passport® loyalty program, which provides members with free standard shipping and no service charge on eligible products across our portfolio of brands, 1-800-FLOWERS.COM, Inc. strives to deepen relationships with customers. The Company also operates BloomNet®, an international floral and gift industry service provider offering a broad-range of products and services designed to help members grow their businesses profitably; Napco℠, a resource for floral gifts and seasonal décor; DesignPac Gifts, LLC, a manufacturer of gift baskets and towers; Alice’s Table®, a lifestyle business offering fully digital livestreaming and on demand floral, culinary and other experiences to guests across the country; and Card Isle®, an e-commerce greeting card service. 1-800-FLOWERS.COM, Inc. was recognized among America’s Most Trustworthy Companies by Newsweek. 1-800-FLOWERS.COM, Inc. was also recognized as one of America’s Most Admired Workplaces for 2025 by Newsweek and was named to the Fortune 1000 list in 2022. Shares in 1-800-FLOWERS.COM, Inc. are traded on the NASDAQ Global Select Market, ticker symbol: FLWS. For more information, visit 1800flowersinc.com.
Key Points: – U.S. holiday spending in 2024 is projected to reach nearly $1 trillion, driven by wage growth and consumer demand. – Over one-third of Americans incurred debt this holiday season, with an average balance of $1,181. – Credit card interest rates remain above 20%, making it crucial to pay off balances quickly to avoid long-term financial strain.
As the holiday season winds down, American consumers are grappling with the financial aftermath of record-breaking spending. Fueled by strong consumer demand and elevated prices, holiday expenditures are set to reach historic levels. However, this surge in spending has coincided with a sharp rise in credit card debt, painting a mixed picture of financial resilience and vulnerability.
According to the National Retail Federation (NRF), U.S. holiday spending for the 2024 season is projected to hit between $979.5 billion and $989 billion. These numbers reflect robust consumer activity from November 1 through December 31, buoyed by wage growth, modest inflation, and healthy household balance sheets.
Jack Kleinhenz, the NRF’s chief economist, commented that these factors have “led to solid holiday spending.” Despite economic uncertainties, consumers have shown remarkable willingness to shop for gifts, experiences, and celebrations.
This holiday season, however, many Americans have leaned heavily on credit cards to fund their purchases. A LendingTree survey revealed that 36% of shoppers took on debt during the season, with the average amount owed climbing to $1,181, up from $1,028 last year.
Matt Schulz, chief credit analyst at LendingTree, pointed to inflation as a key driver behind this trend, saying, “Prices are still really high, and that means lots of Americans simply didn’t have any choice.” For many, the combination of rising costs and the desire to maintain holiday traditions has outweighed concerns about accumulating debt.
Even before the holiday shopping frenzy, credit card debt in the U.S. was at an all-time high. Data from the Federal Reserve Bank of New York shows that balances were 8.1% higher year-over-year heading into the season. Compounding this issue, a NerdWallet report found that 28% of consumers had not fully paid off the credit card debt incurred during last year’s holiday season.
While some see increased spending as a sign of consumer confidence, the costs associated with credit card borrowing remain a significant concern. Interest rates on credit cards now average more than 20%, with some retail card rates climbing even higher.
For those unable to pay off their balances quickly, the financial repercussions can be steep. LendingTree’s survey indicated that 21% of those with holiday debt expect it to take five months or longer to pay off. This extended timeline can lead to ballooning interest charges, diminishing consumers’ ability to save or meet other financial goals.
Schulz warns, “High-interest debt means less money to put towards building an emergency fund, saving for college, or even covering basic expenses. In extreme cases, it can lead to financial insecurity.”
As the new year approaches, financial experts urge consumers to prioritize paying down holiday debt as quickly as possible. Strategies such as creating a repayment plan, consolidating debt, or transferring balances to a lower-interest option can help mitigate the impact of high interest rates.
While the 2024 holiday season may have been a record-setter in terms of spending, its legacy will likely serve as a cautionary tale about the dangers of relying too heavily on credit in an era of rising costs.
Key Points: – Nordstrom will go private in a $6.25 billion deal, with shareholders receiving $24.25 per share in cash. – The Nordstrom family will hold a 50.1% stake, with Mexican retailer Liverpool owning 49.9%. – The privatization aims to revitalize Nordstrom’s operations away from public market pressures.
Nordstrom Inc., the iconic department store chain, is set to go private in a landmark $6.25 billion deal spearheaded by its founding family. This strategic move is designed to provide the company with greater flexibility away from the pressures of the public market, enabling it to address evolving retail challenges more effectively.
Under the terms of the agreement, Nordstrom shareholders will receive $24.25 per share in cash, reflecting a significant valuation for the company. The transaction, expected to close in the first half of 2025, will leave the Nordstrom family with a controlling 50.1% stake, while their partner, Mexican retailer El Puerto de Liverpool SAB, will hold the remaining 49.9%.
Nordstrom’s stock has seen a 33% increase this year, bolstered by optimism surrounding the retail sector’s recovery and this transformative move. However, the offer represents a notable decline from a 2018 bid by the family to take the company private at $50 per share, which the board deemed too low at the time.
This privatization signals the Nordstrom family’s confidence in reviving the brand’s fortunes amidst a shifting retail landscape. CEO Erik Nordstrom expressed optimism about the deal, stating, “On behalf of my family, we look forward to working with our teams to ensure Nordstrom thrives long into the future.”
Nordstrom, like many department stores, has struggled to regain its pre-pandemic revenue levels. After peaking at $15.9 billion in annual revenue in fiscal 2019, the company’s sales have not returned to those heights. Analysts project fiscal 2024 revenue to close at $14.9 billion, reflecting a lingering decline exacerbated by changing consumer habits and the rise of online competitors such as Amazon.
The challenges faced by Nordstrom echo broader trends in the U.S. department store sector. Macy’s Inc. has downsized its store footprint to reduce costs, while Saks Fifth Avenue and Neiman Marcus have undergone significant ownership changes to adapt to market dynamics.
The transaction will be funded through a mix of rollover equity contributions from the Nordstrom family and Liverpool, $450 million in borrowings from a $1.2 billion ABL bank facility, and company cash reserves. A special dividend of up to $0.25 per share is planned for shareholders, contingent on the deal’s completion.
The Nordstrom board, excluding Erik and Peter Nordstrom, who recused themselves from the vote, unanimously approved the transaction. The deal still requires approval from two-thirds of the company’s common stockholders, including a majority of shares not owned by the Nordstrom family or Liverpool.
Taking Nordstrom private marks a pivotal moment for the 123-year-old retailer, granting it the freedom to restructure and innovate away from Wall Street’s scrutiny. The Nordstrom family’s continued involvement and partnership with Liverpool signal a commitment to ensuring the company adapts to the evolving retail landscape.
The success of this move could serve as a case study for other legacy retailers grappling with similar challenges, as Nordstrom seeks to reclaim its position as a leader in the retail industry.
Generates Revenues of $242.1 million and a Net Loss of $34.2 million
Gross Profit Margin Increases 20 basis points to 38.1%
Reports Adjusted EBITDA(1) Loss of $27.9 million
(1) Refer to “Definitions of Non-GAAP Financial Measures” and the tables attached at the end of this press release for reconciliation of non-GAAP results to applicable GAAP results.)
JERICHO, N.Y.–(BUSINESS WIRE)– 1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS), a leading provider of gifts designed to help inspire customers to give more, connect more, and build more and better relationships, today reported results for its Fiscal 2025 first quarter ended September 29, 2024.
“Our first quarter performance generally came in-line with our expectations, as we began to see a slight improvement in our e-commerce revenue trends during the quarter, our gross profit margin continued to grow, and we reduced expenses as a result of our Work Smarter initiatives to operate more efficiently,” said Jim McCann, Chairman and Chief Executive Officer of 1-800-FLOWERS.COM, Inc. “We expect the improvement in our e-commerce revenue trends to accelerate as we move closer to the holiday selling season, and our revenues will further benefit from the growth of wholesale orders this year. Through the Relationship Innovation initiatives that we implemented over the last two years, we have expanded our offerings and broadened our price points, providing gift givers with more choices at prices that span from budget-friendly to premium. We look forward to helping our customers connect and express their sentiments with the important people in their lives.”
Fiscal 2025 First Quarter Highlights
Total consolidated revenues decreased 10.0% to $242.1 million, as compared with the prior year period.
E-commerce revenues decreased 8.0% over the prior year period, comprised of a 6.5% decline in orders and a 1.5% decline in Average Order Value (AOV).
Gross profit margin increased 20 basis points to 38.1%, as compared with the prior year period.
Operating expenses declined $0.2 million to $139.3 million, as compared with the prior year period. Excluding the impact of non-recurring charges in the current period associated with new systems implementation costs, as well as the impact of the Company’s non-qualified deferred compensation plan in both periods, operating expenses declined by $4.2 million to $135.8 million, as compared with the prior year period.
Net loss for the quarter was $34.2 million, or ($0.53) per share, as compared to a net loss of $31.2 million, or ($0.48) per share in the prior year period.
Adjusted Net Loss1 was $32.9 million, or ($0.51) per share, compared with an Adjusted Net Loss1 of $31.2 million, or ($0.48) per share, in the prior year period.
Adjusted EBITDA1 loss for the quarter was $27.9 million, as compared with an Adjusted EBITDA1 loss of $22.5 million in the prior year period.
1-800-FLOWERS.COM, Inc. was named one of Newsweek’s Most Admired Workplaces for 2025.
Segment Results
The Company provides Fiscal 2025 first quarter financial results for its Gourmet Foods and Gift Baskets, Consumer Floral and Gifts, and BloomNet® segments in the tables attached to this release and as follows:
Gourmet Foods and Gift Baskets: Revenues for the quarter declined 14.4% to $84.0 million as compared with the prior year period. This decline reflects the timing of approximately $3.0 million of wholesale orders that shifted from the first quarter into the second quarter. Gross profit margin increased 50 basis points to 32.0%, benefiting from the Company’s inventory optimization efforts and a decline in certain commodity costs. Excluding the impact of the systems implementation costs, adjusted segment contribution margin1 loss was $11.3 million, compared with a loss of $11.0 million in the prior year period.
Consumer Floral & Gifts: Revenues for the quarter declined 4.9% to $135.2 million as compared with the prior year period. Gross profit margin increased 30 basis points to 39.9%. Segment contribution margin1 was $4.9 million, compared with $8.8 million in the prior year period.
BloomNet: Revenues for the quarter declined 20.1% to $23.1 million as compared with the prior year period. Revenue and gross margin were impacted by the lower volume of lower margin orders processed by BloomNet. Gross profit margin decreased 20 basis points to 50.0% due to deleveraging on the lower sales volume. Segment contribution margin1 was $6.8 million, compared with $9.4 million in the prior year period.
Company Guidance
For Fiscal 2025, the Company continues to expect its revenue trend to improve as the fiscal year progresses benefiting from the Company’s Relationship Innovation initiatives that have expanded the Company’s product offerings, broadened price points, and enhanced the user experience, combined with increased marketing spend. The Adjusted EBITDA range reflects the acknowledgement that the consumer environment remains uncertain.
As a result, for Fiscal 2025 the Company continues to expect:
total revenues on a percentage basis to be in a range of flat to a decrease in the low-single digits, as compared with the prior year;
Adjusted EBITDA1 to be in a range of $85 million to $95 million; and
Free Cash Flow1 to be in a range of $45 million to $55 million.
Conference Call
The Company will conduct a conference call to discuss the above details and attached financial results today, October 31, 2024, at 8:00 a.m. (ET). The conference call will be webcast from the Investors section of the Company’s website at www.1800flowersinc.com. A recording of the call will be posted on the Investors section of the Company’s website within two hours of the call’s completion. A telephonic replay of the call can be accessed beginning at 2:00 p.m. (ET) today through November 7, 2024, at: (US) 1-877-344-7529; (Canada) 855-669-9658; (International) 1-412-317-0088; enter conference ID #: 1727189.
Definitions of non-GAAP Financial Measures:
We sometimes use financial measures derived from consolidated financial information, but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain of these are considered “non-GAAP financial measures” under the U.S. Securities and Exchange Commission rules. Non-GAAP financial measures referred to in this document are either labeled as “non-GAAP” or designated as such with a “1”. See below for definitions and the reasons why we use these non-GAAP financial measures. Where applicable, see the Selected Financial Information below for reconciliations of these non-GAAP measures to their most directly comparable GAAP financial measures. Reconciliations for forward-looking figures would require unreasonable efforts at this time because of the uncertainty and variability of the nature and amount of certain components of various necessary GAAP components, including, for example, those related to compensation, tax items, amortization or others that may arise during the year, and the Company’s management believes such reconciliations would imply a degree of precision that would be confusing or misleading to investors. For the same reasons, the Company is unable to address the probable significance of the unavailable information. The lack of such reconciling information should be considered when assessing the impact of such disclosures.
EBITDA and Adjusted EBITDA:
We define EBITDA as net income (loss) before interest, taxes, depreciation, and amortization. Adjusted EBITDA is defined as EBITDA adjusted for the impact of stock-based compensation, Non-Qualified Plan Investment appreciation/depreciation, and for certain items affecting period-to-period comparability. See Selected Financial Information for details on how EBITDA and Adjusted EBITDA were calculated for each period presented. The Company presents EBITDA and Adjusted EBITDA because it considers such information meaningful supplemental measures of its performance and believes such information is frequently used by the investment community in the evaluation of similarly situated companies. The Company uses EBITDA and Adjusted EBITDA as factors to determine the total amount of incentive compensation available to be awarded to executive officers and other employees. The Company’s credit agreement uses EBITDA and Adjusted EBITDA to determine its interest rate and to measure compliance with certain covenants. EBITDA and Adjusted EBITDA are also used by the Company to evaluate and price potential acquisition candidates. EBITDA and Adjusted EBITDA have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP. Some of the limitations are: (a) EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, the Company’s working capital needs; (b) EBITDA and Adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on the Company’s debts; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and EBITDA does not reflect any cash requirements for such capital expenditures. EBITDA and Adjusted EBITDA should only be used on a supplemental basis combined with GAAP results when evaluating the Company’s performance.
Segment Contribution Margin and Adjusted Segment Contribution Margin
We define Segment Contribution Margin as earnings before interest, taxes, depreciation, and amortization, before the allocation of corporate overhead expenses. Adjusted Segment Contribution Margin is defined as Segment Contribution Margin adjusted for certain items affecting period-to-period comparability. See Selected Financial Information for details on how Segment Contribution Margin and Adjusted Segment Contribution Margin were calculated for each period presented. When viewed together with our GAAP results, we believe Segment Contribution Margin and Adjusted Segment Contribution Margin provide management and users of the financial statements meaningful information about the performance of our business segments. Segment Contribution Margin and Adjusted Segment Contribution Margin are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. The material limitation associated with the use of Segment Contribution Margin and Adjusted Segment Contribution Margin is that they are an incomplete measure of profitability as they do not include all operating expenses or non-operating income and expenses. Management compensates for this limitation when using these measures by looking at other GAAP measures, such as Operating Income and Net Income.
Adjusted Net Income (Loss) and Adjusted or Comparable Net Income (Loss) Per Common Share:
We define Adjusted Net Income (Loss) and Adjusted or Comparable Net Income (Loss) Per Common Share as Net Income (Loss) and Net Income (Loss) Per Common Share adjusted for certain items affecting period-to-period comparability. See Selected Financial Information below for details on how Adjusted Net Income (Loss) Per Common Share and Adjusted or Comparable Net Income (Loss) Per Common Share were calculated for each period presented. We believe that Adjusted Net Income (Loss) and Adjusted or Comparable Net Income (Loss) Per Common Share are meaningful measures because they increase the comparability of period-to-period results. Since these are not measures of performance calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, GAAP Net Income (Loss) and Net Income (Loss) Per Common Share, as indicators of operating performance and they may not be comparable to similarly titled measures employed by other companies.
Free Cash Flow:
We define Free Cash Flow as net cash provided by operating activities less capital expenditures. The Company considers Free Cash Flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after the purchases of fixed assets, which can then be used to, among other things, invest in the Company’s business, make strategic acquisitions, strengthen the balance sheet, and repurchase stock or retire debt. Free Cash Flow is a liquidity measure that is frequently used by the investment community in the evaluation of similarly situated companies. Since Free Cash Flow is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP. A limitation of the utility of Free Cash Flow as a measure of financial performance is that it does not represent the total increase or decrease in the Company’s cash balance for the period.
About 1-800-FLOWERS.COM, Inc.
1-800-FLOWERS.COM, Inc. is a leading provider of gifts designed to help inspire customers to give more, connect more, and build more and better relationships. The Company’s e-commerce business platform features an all-star family of brands, including: 1-800-Flowers.com®, 1-800-Baskets.com®, Cheryl’s Cookies®, Harry & David®, PersonalizationMall.com®, Shari’s Berries®, FruitBouquets.com®, Things Remembered®, Moose Munch®, The Popcorn Factory®, Wolferman’s Bakery®, Vital Choice®, Simply Chocolate® and Scharffen Berger®. Through the Celebrations Passport® loyalty program, which provides members with free standard shipping and no service charge on eligible products across our portfolio of brands, 1-800-FLOWERS.COM, Inc. strives to deepen relationships with customers. The Company also operates BloomNet®, an international floral and gift industry service provider offering a broad-range of products and services designed to help members grow their businesses profitably; Napco℠, a resource for floral gifts and seasonal décor; DesignPac Gifts, LLC, a manufacturer of gift baskets and towers; Alice’s Table®, a lifestyle business offering fully digital livestreaming and on demand floral, culinary and other experiences to guests across the country; and Card Isle®, an e-commerce greeting card service. 1-800-FLOWERS.COM, Inc. was recognized among America’s Most Trustworthy Companies by Newsweek. 1-800-FLOWERS.COM, Inc. was also recognized as one of America’s Most Admired Workplaces for 2025 by Newsweek and was named to the Fortune 1000 list in 2022. Shares in 1-800-FLOWERS.COM, Inc. are traded on the NASDAQ Global Select Market, ticker symbol: FLWS. For more information, visit 1800flowersinc.com.
FLWS–COMP FLWS-FN
Special Note Regarding Forward Looking Statements:
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent the Company’s current expectations or beliefs concerning future events and can generally be identified using statements that include words such as “estimate,” “expects,” “project,” “believe,” “anticipate,” “intend,” “plan,” “foresee,” “forecast,” “likely,” “should,” “will,” “target” or similar words or phrases. These forward-looking statements are subject to risks, uncertainties, and other factors, many of which are outside of the Company’s control, which could cause actual results to differ materially from the results expressed or implied in the forward-looking statements, including, but not limited to, statements regarding the Company’s ability to achieve its guidance for the full Fiscal year; the Company’s ability to leverage its operating platform and reduce its operating expense ratio; its ability to successfully integrate acquired businesses and assets; its ability to successfully execute its strategic initiatives; its ability to cost effectively acquire and retain customers; the outcome of contingencies, including legal proceedings in the normal course of business; its ability to compete against existing and new competitors; its ability to manage expenses associated with sales and marketing and necessary general and administrative and technology investments; its ability to reduce promotional activities and achieve more efficient marketing programs; and general consumer sentiment and industry and economic conditions that may affect levels of discretionary customer purchases of the Company’s products. The Company undertakes no obligation to publicly update any of the forward-looking statements, whether because of new information, future events or otherwise, made in this release or in any of its SEC filings. Consequently, you should not consider any such list to be a complete set of all potential risks and uncertainties. For a more detailed description of these and other risk factors, refer to the Company’s SEC filings, including the Company’s Annual Reports on Form 10-K and its Quarterly Reports on Form 10-Q.
Note: The following tables are an integral part of this press release without which the information presented in this press release should be considered incomplete.
Key Points: – Goods trade deficit rose by 14.9% to $108.2 billion, the highest in over two years. – Goods imports increased by 3.8%, reflecting a rise in consumer and capital goods. – Inventory growth in retail, especially for motor vehicles, is likely to cushion GDP impact.
The U.S. goods trade deficit soared in September to its highest level since March 2022, reaching $108.2 billion. This rise, primarily driven by a 3.8% jump in imports, underscores strong consumer demand but has led some economists to scale back their growth projections for the third quarter. Released by the Commerce Department, the deficit reflects the challenges of balancing robust domestic consumption with slowing exports, which declined by 2%.
Economists noted that while a larger trade deficit traditionally weighs down gross domestic product (GDP), this impact may be mitigated by increased retail inventories, particularly in motor vehicles. Consumer spending remains strong, anticipated to be a major driver of growth for the third quarter. Yet, the trade data has led analysts to revise their economic forecasts downward, with some now expecting annualized GDP growth to hit 2.7% rather than the initially forecasted 3.2%.
Imports of consumer goods led the surge, climbing by 5.8%, while food imports saw a 4.6% boost. The demand for capital goods also rose, with businesses stocking up on equipment and industrial supplies, including petroleum and automotive parts. Analysts suggest that businesses were also building up inventories in anticipation of potential supply disruptions, such as the recently resolved dockworkers strike.
Although the high import figures signal economic strength, the dip in exports of consumer goods, industrial supplies, and capital goods points to potential headwinds for U.S. trade competitiveness. The export decline in consumer goods, down by 6.3%, indicates that external demand may be softening, potentially challenging U.S. exporters.
Meanwhile, both wholesale and retail inventories saw shifts in September. Wholesale inventories slipped slightly by 0.1%, while retail inventories rose 0.8%, reflecting sustained consumer demand. Motor vehicle and parts inventories surged by 2.1%, while non-automotive retail inventories grew modestly. Rising inventories support GDP growth, though they also suggest that retailers may have overestimated sales for the period.
Economists are closely watching inventory levels as they provide insight into whether consumer demand can match the increased supply. According to Carl Weinberg, chief economist at High Frequency Economics, an unexpected rise in retail inventories could signal a slowdown in consumer demand but could still provide short-term GDP support.
The recent trade data arrives ahead of Wednesday’s anticipated GDP report, which is expected to provide a clearer picture of the U.S. economy’s trajectory. While strong consumer demand is evident, analysts remain cautious, noting that the elevated goods trade deficit may continue to be a drag on economic growth in the near term.
Key Points: – CVS ousts CEO Karen Lynch, appointing David Joyner as the new Chief Executive. – Lynch’s departure follows repeated earnings misses and rising investor concerns. – CVS stock dropped 7.9% following the leadership change announcement.
CVS Health has made a major leadership change, replacing CEO Karen Lynch with David Joyner, following a period of financial struggles and pressure from activist investors. Joyner, a seasoned executive with extensive experience in pharmacy benefits management (PBM), took over as CEO on Thursday. His appointment comes as CVS grapples with missed earnings targets, rising medical costs, and competition from rivals like Amazon and Walmart.
Shares of CVS fell nearly 8% after the announcement, adding to a 19% drop this year. The company also revealed that its third-quarter earnings would miss Wall Street expectations, prompting CVS to pull its 2024 earnings guidance due to high medical expenses. In a memo to employees, Joyner acknowledged the challenges ahead and called for support in stabilizing the company’s operations. He emphasized the need for operational and financial improvements to maintain CVS’s position as a leading healthcare provider.
CVS’s financial troubles stem largely from its health benefits division, particularly its Aetna insurance arm, where medical costs have outpaced expectations. The company announced a $1.1 billion charge to cover excess medical costs, further straining its finances. Analysts had anticipated issues in the health benefits segment, but CVS’s medical loss ratio of 95.2% for the third quarter was worse than expected, raising concerns among investors.
In response to these difficulties, hedge fund Glenview Capital Management, a CVS investor, has been pushing for changes within the company. Glenview supported the decision to replace Lynch, viewing it as a necessary step toward improving CVS’s financial performance and governance. In a statement, Glenview expressed interest in working with Joyner to enhance the company’s operations and create value for stakeholders.
Lynch’s departure ends a tumultuous tenure as CEO, which began in February 2021. She led CVS’s expansion into healthcare services, acquiring companies like Oak Street Health and Signify Health to strengthen CVS’s Medicare Advantage business. However, the timing of these acquisitions coincided with tighter restrictions on Medicare spending imposed by the Biden administration, which negatively impacted CVS’s margins.
CVS also faced setbacks in its PBM division, Caremark, losing a significant contract with Centene Corp., which chose to partner with Cigna instead. Caremark is also under investigation by the Federal Trade Commission (FTC) for its role in rising drug prices, including insulin. Joyner, who previously led Caremark, defended the company’s practices before Congress earlier this year, and his expertise in this area is expected to help CVS navigate regulatory challenges and increased competition.
The health benefits segment remains CVS’s most significant concern, particularly as the company experienced rapid growth in Medicare Advantage membership in 2024. However, the costs associated with that growth have exceeded projections, prompting CVS to withdraw its earnings forecast for 2024. The company had previously lowered its earnings guidance several times this year, with the most recent estimate between $6.40 and $6.55 per share. Analysts had already predicted a 25% drop in earnings per share for 2024 compared to the previous year, and that figure is expected to fall further.
With Joyner at the helm, CVS faces a critical moment. The board unanimously supported his appointment, and he is tasked with steering the company through its current challenges and restoring investor confidence in its future.
Apple’s much-anticipated iPhone 16 event has begun, unveiling new Watches, AirPods, and a suite of AI-focused upgrades to its latest smartphone. At the Steve Jobs Theater in Cupertino, California, Apple CEO Tim Cook introduced the new Series 10 Watch, AirPods 4, and teased the AI-powered iPhone 16, which marks Apple’s first smartphone designed around artificial intelligence. While the product launch showcased exciting innovations, the event holds significant weight for investors who are closely watching how Apple navigates a slowing market and fierce competition.
With Apple’s share price remaining largely unchanged during the event, the unveiling signals that while new products are always welcome, the critical question for investors is whether this AI push will translate into meaningful revenue growth. Apple’s AI initiative, Apple Intelligence, aims to improve the user experience with advanced text, image, and content generation features. The company is betting on this technology to help boost sales, especially as iPhone revenues, which accounted for over half of Apple’s $383 billion in sales last year, have faced slower growth in recent quarters.
This AI-driven upgrade comes at a pivotal moment. Apple’s competitors, particularly in China, are aggressively expanding their AI capabilities. Notably, Huawei pre-empted Apple’s launch with its own tri-fold smartphone announcement, boasting over 3 million pre-orders. Huawei’s ability to navigate U.S. sanctions and its dominance in the Chinese market puts additional pressure on Apple, which has struggled in the region due to increasing competition and government restrictions. For investors, Apple’s performance in China remains a critical factor, as AI features will take longer to roll out in that market, further delaying potential growth.
The release of the iPhone 16 with Apple Intelligence is expected to drive upgrades, but the rollout of key AI features will be gradual. Apple plans to introduce these updates in the U.S. this fall, with a wider Siri upgrade slated for early 2025. However, investors will be keen to see whether Apple’s AI features can spur a major upgrade cycle, particularly as Google and other competitors are accelerating their own AI integrations.
Investors are not just looking at consumer interest but also the broader AI battle in the tech industry. Google, which has already showcased advanced AI features, such as Gemini Live, is also vying for dominance in the smartphone market. Google’s push into AI further intensifies competition in a segment where Apple has long reigned supreme.
Apple’s stock performance and future growth will be closely tied to how well the iPhone 16 and its AI capabilities resonate with consumers. The company is relying on this new technology to entice customers to upgrade, but it’s also worth noting that economic uncertainty and evolving tech regulations could influence both customer demand and the company’s bottom line.
This event comes on the heels of Apple’s recent AI-focused updates at its developer conference in June, where it laid the groundwork for the Apple Intelligence platform. With global demand for AI-driven features rising, particularly in markets like China, Apple is positioning itself for what could be the next major growth frontier. However, investors will need to watch for signs that this new strategy can deliver in the short term, especially as competition from companies like Huawei and Google heats up.
For investors, the big takeaway is whether Apple’s AI push will be enough to spur demand in a weakening smartphone market. The success of the iPhone 16 and its AI features could define Apple’s trajectory in the coming quarters, particularly as it faces increased competition and slowing sales in key markets.
Key Points: – U.S. consumer spending increased 0.5% in July, showing economic strength – Inflation remains moderate, with PCE price index rising 2.5% year-on-year – Robust spending challenges expectations for aggressive Fed rate cuts
In a surprising turn of events, U.S. consumer spending showed remarkable strength in July, potentially altering the Federal Reserve’s monetary policy trajectory. This robust economic indicator may put a damper on expectations for aggressive interest rate cuts, particularly the anticipated half-percentage-point reduction in September.
Consumer spending, which accounts for over two-thirds of U.S. economic activity, rose by 0.5% in July, following a 0.3% increase in June. This uptick, aligning with economists’ forecasts, suggests the economy is on firmer ground than previously thought. After adjusting for inflation, real consumer spending gained 0.4%, maintaining momentum from the second quarter. Conrad DeQuadros, senior economic advisor at Brean Capital, notes, “There is nothing here to push the Fed to a half-point cut. This is not the kind of spending growth associated with recession.”
While spending surged, inflation remained relatively contained. The Personal Consumption Expenditures (PCE) price index, the Fed’s preferred inflation gauge, rose 0.2% for the month and 2.5% year-on-year. Core PCE inflation, which excludes volatile food and energy prices, increased by 0.2% monthly and 2.6% annually. These figures, while showing progress towards the Fed’s 2% target, indicate that inflationary pressures persist, potentially complicating the central bank’s decision-making process.
Despite a jump in the unemployment rate to a near three-year high of 4.3% in July, which initially stoked recession fears, the labor market continues to generate decent wage growth. Personal income rose 0.3% in July, with wages climbing at the same rate. This suggests that the slowdown in the labor market is primarily due to reduced hiring rather than increased layoffs.
Fed Chair Jerome Powell recently signaled that a rate cut was imminent, acknowledging concerns over the labor market. However, the strong consumer spending data may force the Fed to reconsider the pace and magnitude of potential rate cuts. David Alcaly, lead macroeconomic strategist at Lazard Asset Management, offers a longer-term perspective: “There’s a lot of focus right now on the pace of rate cuts in the short term, but we believe it ultimately will matter more how deep the rate-cutting cycle goes over time.”
The Atlanta Fed has raised its third-quarter GDP growth estimate to a 2.5% annualized rate, up from 2.0%. This revision, coupled with the strong consumer spending data, paints a picture of an economy that’s more resilient than many had anticipated. The increase in spending was broad-based, covering both goods and services. Consumers spent more on motor vehicles, housing and utilities, food and beverages, recreation services, and financial services. They also boosted spending on healthcare, visited restaurants and bars, and stayed at hotels.
As the Fed navigates this complex economic landscape, investors and policymakers alike will be closely watching for signs of whether the central bank will prioritize fighting inflation or supporting economic growth in its upcoming decisions. The robust consumer spending data suggests that the economy may not need as much support as previously thought, potentially leading to a more cautious approach to rate cuts.
For investors, this economic resilience presents both opportunities and challenges. While strong consumer spending bodes well for many sectors, it may also lead to a less accommodative monetary policy than some had hoped for. As always, a diversified approach and close attention to economic indicators will be crucial for navigating these uncertain waters.
Key Points: – Expansion of global reach with 130,000+ new locations – Enhanced offering with advanced gift card and loyalty programs – Strategic alignment for increased customer value and retention
Shift4, the leading integrated payments and commerce technology company, is set to make waves in the global market with its latest acquisition announcement. The company has signed a definitive arrangement agreement to acquire Givex Corp., a renowned provider of gift cards, loyalty programs, and point-of-sale solutions. This strategic move is poised to reshape the landscape of payment processing and customer engagement technologies.
The acquisition, expected to close in the fourth quarter of this year, will significantly expand Shift4’s global footprint. With Givex’s impressive network of over 130,000 active locations across more than 100 countries, Shift4 is positioning itself as a major player in the international payments arena. This expansion not only increases Shift4’s customer base but also opens up new markets and opportunities for growth.
One of the most compelling aspects of this acquisition is the enhancement of Shift4’s service offerings. Givex brings to the table a suite of robust gift card and e-gift solutions, along with customizable loyalty programs that have been adopted by industry giants such as Nike, Marriott, and Wendy’s. These additions will allow Shift4 to offer a more comprehensive package to its existing clients, potentially increasing customer retention and attracting new business.
The synergy between the two companies is evident in their complementary technologies. Shift4’s end-to-end payment solution, combined with Givex’s value-added engagement services, creates a powerful toolkit for businesses looking to streamline their operations and enhance customer relationships. This integration is expected to deliver an unparalleled package to both companies’ customer bases, setting a new standard in the industry.
From a financial perspective, this acquisition aligns perfectly with Shift4’s capital deployment strategy. By acquiring a company with an established customer base, Shift4 is effectively lowering its customer acquisition costs while simultaneously expanding its service portfolio. This approach is likely to contribute positively to Shift4’s bottom line and create long-term value for shareholders.
The merger also presents exciting opportunities for innovation. As the payments industry continues to evolve, the combined expertise of Shift4 and Givex could lead to the development of cutting-edge solutions that address emerging market needs. This potential for innovation could be a key differentiator in a highly competitive market.
As businesses increasingly prioritize customer engagement and loyalty, the timing of this acquisition couldn’t be better. The integration of Givex’s loyalty and gift card solutions into Shift4’s existing infrastructure will enable businesses to create more personalized and rewarding experiences for their customers. This focus on customer retention and engagement is crucial in today’s market, where consumer loyalty is harder than ever to maintain.
In conclusion, Shift4’s acquisition of Givex Corp. marks a significant milestone in the company’s growth strategy. By expanding its global reach, enhancing its product offerings, and strengthening its market position, Shift4 is well-positioned to capitalize on the growing demand for integrated payment and loyalty solutions. As the transaction moves towards completion, industry observers and stakeholders will be watching closely to see how this strategic move unfolds and shapes the future of payment processing and customer engagement technologies.
Key Points: – Temu and Shein’s rapid growth in the US market is influencing tech earnings and competition. – These platforms leverage low prices and aggressive marketing strategies to gain market share. – The impact of Chinese e-commerce companies on US tech giants raises questions about fair competition and trade policies.
In recent months, the e-commerce landscape in the United States has been dramatically altered by the meteoric rise of Chinese discount shopping apps Temu and Shein. As Wall Street prepares for the latest round of tech earnings reports, the influence of these platforms on industry giants like Amazon, Meta, and eBay is becoming increasingly apparent.
Temu and Shein have captured the attention of American consumers with their rock-bottom prices and aggressive marketing campaigns. Temu, which launched in the US in 2022, quickly surpassed established social media apps in popularity on the Apple App Store. Shein, present in the US market since 2017, has seen similar success. Both platforms offer incredibly low-priced goods, such as $3 shoes or $15 smartwatches, directly from Chinese manufacturers to American consumers.
The success of these platforms is partially attributed to a trade loophole known as the de minimis exception. This rule allows packages valued under $800 to enter the US duty-free, giving Chinese retailers a significant competitive advantage. Amazon’s top public policy executive, David Zapolsky, has expressed concern about this trend, suggesting that some business models may be unfairly subsidized.
The impact of Temu and Shein extends beyond just e-commerce. Their substantial ad spending has become a significant revenue source for companies like Google and Facebook. However, recent data suggests that Temu may be adjusting its marketing strategy, potentially affecting ad revenue for these tech giants.
Established e-commerce players are responding to this new competition in various ways. Amazon, while emphasizing its delivery speed advantage, is reportedly planning to launch its own discount store featuring unbranded items priced below $20. eBay has stressed its differentiated selection, while Etsy has highlighted its focus on artisan goods.
The rise of these Chinese platforms has also sparked discussions about fair competition and trade policies. US officials, along with their counterparts in the European Union, are considering closing the de minimis loophole, which could significantly impact the growth of Temu and Shein.
Despite the challenges posed by these new entrants, analysts suggest that major players like Amazon and Walmart are relatively insulated from the competition. The established e-commerce giants’ superior shipping speeds and extensive logistics networks provide a significant competitive advantage.
As the tech industry braces for the upcoming earnings reports, all eyes will be on how companies address the impact of Temu and Shein. Investors will be particularly interested in any commentary on changes in e-commerce marketplaces and shifts in ad spending patterns.
The story of Temu and Shein’s rise in the US market is more than just a tale of successful market entry. It represents a shifting dynamic in global e-commerce, raising important questions about international trade policies, fair competition, and the future of retail. As these Chinese platforms continue to grow and evolve, their impact on the US tech industry and broader economy will likely remain a topic of intense scrutiny and debate.
All company presentation replays will be posted here 24-48 hours following the event. Access to the presentation / Q&A is available exclusively to Channelchek members. Channelchek is a free investor community. All it takes is a name and verified e-mail address. Click the button below to register:
Emerging Growth Public TMT/Consumer Company Executive Presentations
Q&A Sessions Moderated by Noble’s Analysts
Scheduled 1×1 Meetings with Qualified Investors
Noble Capital Markets, a full-service SEC / FINRA registered broker-dealer, dedicated exclusively to serving emerging growth companies, is pleased to present the Consumer, Communications, Media, and Technology Emerging Growth Virtual Equity Conference, taking place June 26th and 27th, 2024. This virtual gathering is set to be an immersive experience, bringing together a unique blend of investors, industry leaders, and experts in the consumer, communications, media, and technology sectors..
Part of Noble’s Robust 2024 Events Calendar
The Consumer, Communications, Media, and Technology Emerging Growth Virtual Equity Conference is part of Noble’s 2024 event programming, featuring a range of c-suite interviews, in-person non-deal roadshows throughout the United States, two other sector-specific virtual equity conferences, and culminating in Noble’s preeminent in-person investor conference, NobleCon20, to be held at Florida Atlantic University in Boca Raton, Florida December 3-4. Keep an eye out for the official press release on NobleCon20 coming soon.
The Consumer, Communications, Media, and Technology Emerging Growth Virtual Equity Conference will feature 2 days of corporate presentations from up to 50 innovative public consumer, communications, media, and technology companies, showcasing their latest advancements and investment opportunities. Each presentation will be followed by a fireside-style Q&A session proctored by one of Noble’s analysts or bankers, with questions taken from the audience during the presentation. Panel presentations are planned, featuring key opinion leaders in these sectors, providing valuable insights on emerging trends. Scheduled one-on-one meetings with public company executives, coordinated by Noble’s dedicated Investor Outreach team, are also available to qualified investors.
Why Your Company Should Present
Looking to increase awareness in your company and increase liquidity? Paid participation in Noble’s investor conferences, both virtual and in-person, provides that opportunity, with a tailored experience aimed at delivering substantial value. After 40 years of serving emerging growth companies, and the investors who follow them, Noble has built an investor base eager to discover where the next success story lies.
Noble’s investor base is relevant and, in many cases, new to your company. Noble’s dedicated Investor Outreach team provides unmatched exposure to investors that can invest in your company, including small money managers, family offices, RIAs, wealth managers, self-directed investors, and institutions. Most of Noble’s investors specifically seek undervalued, overlooked, emerging investment opportunities.
The cost to present includes your corporate presentation with a Q&A session proctored by one of Noble’s analysts or bankers, a webcast recording, scheduled 1×1 meetings with qualified investors, and marketing on Channelchek.
Benefits for Investors
Hear directly from the c-suite of the next innovators in consumer, communications, media, and technology and learn about new investment opportunities. The Q&A portion of each presentation gives you the opportunity to have your questions answered during or after the proctored session. The planned panel presentations are sure to provide expert insight on growing trends in the healthcare space. And, for qualified investors, one-on-one meetings are available with company executives; scheduled by Noble’s dedicated Investor Outreach team. All from the comfort of your own desk, and at no cost.
How to Register
If you have any questions about presenting, please contact events@noblecapitalmarkets.com
NEW YORK, May 16, 2024 (GLOBE NEWSWIRE) — Xcel Brands, Inc. (NASDAQ: XELB) (“Xcel” or the “Company”), today announced that it will report its first quarter 2024 financial results on May 20, 2024. The Company will hold a conference call with the investment community on May 20, 2024, at 5:00 p.m. ET.
Interested parties unable to access the conference call via the webcast may dial 800-715-9871 or 646-307-1963 and use the Conference ID 3975904. A replay of the webcast will be available on Xcel’s website.
About Xcel Brands
Xcel Brands, Inc. (NASDAQ: XELB) is a media and consumer products company engaged in the design, marketing, live streaming, social commerce sales of branded apparel, footwear, accessories, fine jewelry, home goods and other consumer products, and the acquisition of dynamic consumer lifestyle brands. Xcel was founded in 2011 with a vision to reimagine shopping, entertainment, and social media as one thing. Xcel owns the Judith Ripka, Halston, LOGO by Lori Goldstein, and C. Wonder by Christian Siriano brands and a minority stake in the Isaac Mizrahi brand. It also owns and manages the Longaberger brand through its controlling interest in Longaberger Licensing LLC and a 50% interest in a JV in TWRHLL (“Tower Hill”) by Christie Brinkley. Also Xcel owns a 30% interest in Orme, a short-form video market place. Xcel is pioneering a true modern consumer products sales strategy which includes the promotion and sale of products under its brands through interactive television, digital live-stream shopping, social commerce, brick-and-mortar retail, and e-commerce channels to be everywhere its customer’s shop. The company’s brands have generated in excess of $4 billion in retail sales via livestreaming in interactive television and digital channels alone. Headquartered in New York City, Xcel Brands is led by an executive team with significant live streaming, production, merchandising, design, marketing, retailing, and licensing experience, and a proven track record of success in elevating branded consumer products companies. For more information, visit www.xcelbrands.com.
Emerging Growth Public Consumer, Communications, Media, Technology (and more) Company Executive Presentations
Q&A Sessions Moderated by Noble’s Analysts and Bankers
Scheduled 1×1 Meetings with Qualified Investors
Noble Capital Markets, a full-service SEC / FINRA registered broker-dealer, dedicated exclusively to serving emerging growth companies, is pleased to present the Consumer, Communications, Media, and Technology Emerging Growth Virtual Equity Conference, taking place June 26th and 27th, 2024. This virtual gathering is set to be an immersive experience, bringing together a unique blend of investors, industry leaders, and experts in the consumer, communications, media, and technology sectors.
Part of Noble’s Robust 2024 Events Calendar
The Consumer, Communications, Media, and Technology Emerging Growth Virtual Equity Conference is part of Noble’s 2024 event programming, featuring a range of c-suite interviews, in-person non-deal roadshows throughout the United States, two other sector-specific virtual equity conferences, and culminating in Noble’s preeminent in-person investor conference, NobleCon20, to be held at Florida Atlantic University in Boca Raton, Florida December 3-4. Keep an eye out for the official press release on NobleCon20 coming soon.
The Consumer, Communications, Media, and Technology Emerging Growth Virtual Equity Conference will feature 2 days of corporate presentations from up to 50 innovative public consumer, communications, media, and technology companies, showcasing their latest advancements and investment opportunities. Each presentation will be followed by a fireside-style Q&A session proctored by one of Noble’s analysts or bankers, with questions taken from the audience during the presentation. Panel presentations are planned, featuring key opinion leaders in these sectors, providing valuable insights on emerging trends. Scheduled one-on-one meetings with public company executives, coordinated by Noble’s dedicated Investor Outreach team, are also available to qualified investors.
Why Your Company Should Present
Looking to increase awareness in your company and increase liquidity? Paid participation in Noble’s investor conferences, both virtual and in-person, provides that opportunity, with a tailored experience aimed at delivering substantial value. After 40 years of serving emerging growth companies, and the investors who follow them, Noble has built an investor base eager to discover where the next success story lies.
Noble’s investor base is relevant and, in many cases, new to your company. Noble’s dedicated Investor Outreach team provides unmatched exposure to investors that can invest in your company, including small money managers, family offices, RIAs, wealth managers, self-directed investors, and institutions. Most of Noble’s investors specifically seek undervalued, overlooked, emerging investment opportunities.
The cost to present includes your corporate presentation with a Q&A session proctored by one of Noble’s analysts or bankers, a webcast recording, scheduled 1×1 meetings with qualified investors, and marketing on Channelchek.
Benefits for Investors
Hear directly from the c-suite of the next innovators in consumer, communications, media, and technology and learn about new investment opportunities. The Q&A portion of each presentation gives you the opportunity to have your questions answered during or after the proctored session. The planned panel presentations are sure to provide expert insight on growing trends in the healthcare space. And, for qualified investors, one-on-one meetings are available with company executives; scheduled by Noble’s dedicated Investor Outreach team. All from the comfort of your own desk, and at no cost.
