No more fun and games
Playtime's over for toy makers
Good morning, hardworking reindeer. This is your Stock Market Rundown for November 1st, 2023. Thank you so much for being here. Let’s dig in:
TODAY’S TOP STORY: TOYS R NOT US 🧸
They’re making a list and checking it twice. Kids, that is—planning what gifts they want to beg the local mall Santa to pile under the tree this holiday season.
But they may want to forget about the fat man and focus on coaxing their parents, based on tepid sales forecasts from top toymakers.
Hasbro’s iconic franchises like Transformers, Nerf, and Power Rangers may not be enough to keep its yuletide merry: the company recently cut its 2023 revenue forecast, with the CEO warning that the holiday season “is going to be unpredictable.”
As for toy-aisle competitor Mattel, they got a boost thanks to the blockbuster Barbie movie (this collectible Ken doll is impressively screen-accurate). But the pink sparkles have already worn off. In a recent earnings call, Mattel’s CEO cautioned that demand is slowing in Toyland.
Why the Grinch-y attitude? With inflation weighing on household budgets and recession fears looming, moms and dads aren’t rushing to splurge on big-ticket toy purchases.
Plus, kids these days want to stare at a screen, not play with injection-molded plastic. Obviously, there are exceptions: any toddler would lose their mind over the Paw Patrol Aircraft Carrier. (The defense budget of Adventure Bay is clearly spiraling out of control.)
Hasbro and Mattel just have to pray some toy will go viral and save Christmas. Hey, maybe the rebooted versions of Furbys and Tamagotchis will be a hit, now that the geriatric millennials who played with them the first go-round have offspring of their own.
SO WHAT ELSE IS GOING ON?
Gen Z shoppers have embraced “dupe shopping”—using TikTok to locate cheaper versions of luxury products. It’s basically a rebranding of knockoffs, with influencers pushing “dupes” of everything from high-end couches to premium toilet paper. Why pay for the logo?
The price of a dozen eggs got you bursting into tears? That’s bullish for Kimberly-Clark, makers of Kleenex—they raised full-year guidance.
Another company that reported a beat and raise this quarter: Logitech, maker of your sick gaming mouse that glows blue while you play Dota 2.
WAGMI days are here again: Bitcoin spiked to its highest price in two years on speculation that US regulators may soon approve a Bitcoin ETF.
Elon Musk’s Boring Company was valued at $7 billion in a recent transaction. This is his business that digs holes in the ground—not to be confused with Twitter, the business he drove into the ground.
That’s it for today, my friends; see you bright and early tomorrow morning. Yours in capitalism, The Axe