Fashion flop
H&M unravels
Good morning, trend trailblazers. This is your Stock Market Rundown for February 7th, 2024. Thank you, once again, for reading. Let’s dig in:
TODAY’S TOP STORY: A FASHIONABLE EXIT
Ever been so miserable at a job you just ragequit? Ah, it’s so satisfying to say: “take this job and shove it!” But it’s not a move you usually expect from a public company CEO.
Helena Helmersson, CEO of women’s clothing retailer H&M, just shocked the fashion industry by unexpectedly peacing out after 26 years at the company, and four at the helm. Her only comment was that the job had been "very demanding". I’m guessing she’ll be spending the next six months on a beach somewhere, margarita in hand, wondering where it all went wrong.
It’s easy to appreciate why running H&M right now might leave you in need of some self-care. As a pioneer of “fast fashion”, H&M dominates urban closets by turning over merchandise quickly to follow trends, and selling it cheap enough that it’s disposable. If something has been on the rack for a week, it’s practically considered vintage.
That strategy helped the business scale to over 4,000 stores. But now, H&M is being undercut on the low end by ultracheap Chinese competitors like Shein, and squeezed on the high end by upmarket competitor Zara. Result: layoffs and store closures. It’s like the name suddenly stands for “hurry & markdown.”
With the CEO’s abrupt departure, H&M has scrambled to appoint a new chief, who has to deal with yet another crisis: disruptions to Red Sea shipping lanes due to militant attacks are slowing down shipments to European customers.
Supply chain snafus put more pressure on the bottom line. But unless execs at H&M want to load their frocks, socks, and slacks into a rowboat and start paddling, they’re just going to have to wait.
SO WHAT ELSE IS GOING ON?
What, you mean you’re not on Ozempic yet? Novo Nordisk, maker of the hit weight-loss drug, is expecting continued double-digit growth as everybody gets annoyingly skinny. Food is so last season, darling.
Apple just released their Vision Pro virtual reality headset, which is similar to Microsoft’s Oculus but—because it’s an Apple product—way more expensive. Can’t wait to look like a member of Daft Punk while I sum up columns in an Excel spreadsheet.
Dad’s favourite power tool manufacturer, Stanley Black & Decker, beat estimates, thanks to cutting costs like their customers cut two-by-fours. Seems like they’re doing a better job running the company than I did the last time I tried to use a power drill to hang a picture frame.
Healthcare company Abbott Laboratories is being sued for claiming its Pediasure protein shakes help children grow taller. News flash: something with the nutritional profile of a chocolate milkshake isn’t turning your kid into Lebron James.
That's all for today, superstars; catch you on the flip side tomorrow morning. Yours in capitalism, The Axe