🛥️ Superyacht sales drop globally

Good morning Investor. “Even the smallest person can change the course of the future.”

— Galadriel, The Fellowship of the Ring

MARKET UPDATE

Shares of Duolingo (DUOL) rose over 7% on news of the company’s official inclusion into the S&P Midcap 400 index.

TODAY’S BIG HEADLINES

• Superyacht sales drop globally

• One subscription to rule them all

• Atlas, the next-generation robot

• The Bitcoin Halving is here

LUXURY GOODS

Superyacht sales drop globally🛥️

Sinking Demand: Earlier this week, the world of opulence took a hit. Louis Vuitton (LVMH), the beacon of luxury, reported a slump in their Q1 sales. It seems the high-end consumers are tightening their Gucci belts, and this trend is making waves, quite literally, in the yachting industry.

Anchored Sales: The superyacht market, once buoyed by Russian oligarchs, is now feeling a bit seasick. It seems our deep-pocketed friends have docked their wallets, leading to a 35% plunge in superyacht sales since 2021. Talk about a Titanic-sized problem!

Costly Captains: When Russia and Ukraine decided to play battleships, the world responded with sanctions, seizing the assets of Russian oligarchs, including their floating palaces. But who knew that babysitting a superyacht could burn a hole in Uncle Sam’s pocket? One particular yacht, now docked in San Diego, has already cost the US government a whopping $20 million in maintenance. That’s a lot of tax dollars keeping the deck swabbed and the caviar chilled!

Backlog Bonanza: But it’s not all stormy seas for the yachting industry. Thanks to a backlog of orders from the pandemic, new superyacht completions surged by 31% last year. But don’t pop the champagne just yet. While the shipyards are busy, delivering these floating mansions to their new owners is another story. With wait times of up to four years, the costs of labor and materials are skyrocketing. It’s like waiting for a pizza that gets more expensive the longer it takes to arrive!

Size Matters: Here’s a fun fact: Russian oligarchs, some of the industry’s biggest customers, prefer their yachts to be an average of 200 feet long. That’s just shy of the 202-foot aquatic behemoths favored by the Saudi Arabians, and significantly longer than the modest 177-foot vessels preferred by American customers. It’s not a competition, but if it were, we know who’d be winning.

sources: (CNBC), (CNN)

MEGA CAPS

One subscription to rule them all🛍️

Just Sign Here: Meanwhile, in the land of ecommerce, Amazon (AMZN) is flexing its muscles with a staggering 180 million Prime subscribers in the US alone. That’s half the population! Despite fierce competition from the likes of TikTok Shop, Temu, and Shein, Prime’s growth rate has been a robust 8% over the past year. This suggests that Amazon raked in $10.8 billion in subscription revenue for Q1, a 12% YoY increase. Not too shabby for a company that started selling books!

Prime Perks: Research indicates that Prime members tend to spend more on Amazon than their non-Prime counterparts. So, the subscription offers more than just predictable, recurring revenue. It’s like having a golden goose that keeps laying eggs. Currently, US shoppers shell out $15 a month, or $140 a year, for the privilege of being a Prime member.

The Price Is Right: With its recent growth and sizable customer base, it seems Prime is the club everyone wants to join. But how much can Amazon hike its prices before customers start to leave? That’s the million-dollar question. Or should we say, the $140-a-year question?

sources: (BusinessTimes), (Bloomberg), (Quartz)

ROBOTICS

Atlas, the next-generation robot 🤖

The Machine Uprising: In a scene straight out of a Terminator movie, Boston Dynamics, the maestros of acrobatic robotics, pulled the curtain back on their latest creation, “Atlas”. This all-electric, hydraulic-powered humanoid robot is the new kid on the block, taking the baton from its predecessor. With its swiveling joints, Atlas is showing off moves that would make a gymnast green with envy.

The Big Reveal: Boston Dymanics dropped the reveal video on YouTube, and boy, did it make a splash! Over 2.3 million views in just one day. The video starts with Atlas playing possum, only to fold its legs backward over its body and rise like a phoenix. The full rotation of its torso and head would be right at home in any horror-flick.

Robot Rumble: The robotics arena is heating up this year, with several contenders stepping into the ring. Tesla’s Optimus and Figure 01, boasting an OpenAI integration, are just a few of the new gladiators. The original Atlas was designed for search and rescue missions, but Boston Dynamics now sees it as a warehouse workhorse, carrying oddly shaped, heavy items. It seems Atlas is ready to rumble with its aforementioned competitors.

sources: (The Verge), (Independent)

CRYPTOCURRENCY

The Bitcoin Halving is here✂️

Bitcoin’s Big Day: The Bitcoin halving event, scheduled for Saturday, April 20th, has the crypto world buzzing. But some so-called “experts” are predicting a selloff for the digital asset. Talk about raining on Bitcoin’s parade!

Proceed With Caution: JP Morgan is waving the caution flag, suggesting the halving could be another “sell the news” event. Their prediction is based on the open interest in Bitcoin futures, which currently indicate that the token is considered overbought despite the recent selloff. It’s effectively a game of hot potato with a digital coin.

Fragments Of Time: Let’s take a stroll down Bitcoin’s halving history.

• 2016: Bitcoin was as flat as a pancake leading into the halving, but then it rallied by 15% over the next three days. However, it then took a nosedive, dropping by 32% over the following month and hitting rock bottom on August 24th. But like a phoenix, it rose from the ashes, starting a mega-rally again in October.

• 2020: Bitcoin took a 12% tumble just three days before the halving, only to bounce back in the next four days. The real fireworks started in October of that year.

And The Winner Is…: The Bitcoin miners. According to a JP Morgan analyst, “As unprofitable Bitcoin miners exit the Bitcoin network, we anticipate a significant drop in the hashrate and consolidation among Bitcoin miners with the highest share for publicly-listed Bitcoin miners.” It seems the house always wins, even in the world of crypto!

sources: (Coindesk), (Coingecko), (Bitcoin.com)

MORE NEWS

Additional market-moving events🌎

• Layoffs Hit Gaming: Take-Two Interactive, The maker of the beloved GTA and NBA 2K have just announced they’ll be cutting 579 jobs as well as scrapping a bunch of titles currently being made as the gaming industry continues to face layoffs. (The Verge)

• Treasury Rally: US 2-year Treasury yield rose on Thursday to just shy of 5% following new data indicating strength in the manufacturing sector. (CNBC)

• Meta’s Takes AI Throne: Meta announced its new-and-improved AI model Llama 3. Meta claims that its new model outperforms competing models of its class on key benchmarks and that it’s better across the board at tasks like coding. (The Verge)

• Cheap As Chips!: Popular fast-food chain Wendy’s will begin offering free fries every Friday through the end of the year starting this week. (Fortune)

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