💉 Weight-loss frenzy

…and Reddit's AMA earnings

Gaining weight on the balance sheet (Michael Siluk/Getty Images)

Last Week's Market Moves   Dow Jones 38,676 (+1.14%) S&P 500 5,128 (+0.55%) Nasdaq 16,156 (+1.43%) Bitcoin $62,579 (-1.80%) Dow Jones 38,676 (+1.14%) S&P 500 5,128 (+0.55%) Nasdaq 16,156 (+1.43%) Bitcoin $62,579 (-1.80%)

Hey Snackers, In the market for a new desktop? You might wanna check out Cheyenne, a 4K-pound decommissioned gov't supercomputer up for auction. Be warned: it occasionally struggles with water spray from its cooling system. Stocks ended the week higher after a weaker-than-anticipated jobs report raised hopes for a September rate cut (bad news = good). Earnings szn's in full swing, with expectation-beating #s from Amazon and Apple last week (though iPhone sales dropped 10%). Btw... Do you want to start getting Snacks daily? Or prefer to unsubscribe? Manage your subscription preferences here.

Injection

The craze for weight-loss drugs has led to slim supply and big earnings Suppressing appetites… and fattening profits. The weight-loss-drug frenzy has gone into overdrive, leading to ballooning earnings for the pharma giants that manufacture the injectable meds. Novo Nordisk last week reported that sales of its weight-loss drug Wegovy more than doubled last quarter, fueling a 28% profit jump. The Danish drugmaker is Europe's most valuable company (and its market cap is bigger than Denmark's GDP). American pharma rival Eli Lilly reported a 67% profit surge and hiked its annual sales forecast by $2B thanks to its new blockbuster weight-loss drug Zepbound. Racing to meet demand: Novo Nordisk is investing $6B to boost production of Wegovy and its diabetes drug Ozempic, also used for weight loss. Doing the literal most: After doubling production capacity for Zepbound and its related diabetes drug, Mounjaro, Eli Lilly is still racing to ramp up. Its CFO said: "We have sites working 24/7. We're doing construction overnight." Prescription friction… The clamor for drugs associated with weight loss has made it harder for people with type 2 diabetes to fill their prescriptions for meds like Ozempic, which is often prescribed off-label. Eli Lilly and Weight Watchers both rolled out telehealth prescription services for weight-loss drugs to make it easier for folks to get the shots. Drugs that've been FDA-approved for weight loss (like Zepbound and Mounjaro) are expected to be in shortage through at least June. Cash injection: Novo Nordisk said that each week last quarter 25K+ people started taking Wegovy (which was recently approved for cardiovascular-risk reduction in those with obesity). Massive market: 42% of US adults fall into the obese category (usually a BMI of 30+). Worldwide, analysts estimate these weight-loss drugs could soon be worth $100B/year. THE TAKEAWAY Shedding pounds is pricey… if you want the help of drugs. Affordability is a limiting factor for pharma companies' ambitions. While most corporate health-insurance plans cover this class of drugs for diabetes, only about 25% do so for weight loss. Without insurance, drugs like Wegovy and Zepbound can cost up to $1.5K/month. But as approved uses expand (as just happened with Wegovy) so could coverage.

Events

Coming up this week Ask Reddit Anything… Reddit plans to crowdsource Q's from users on r/RDDT for its earnings call this week. It's the social icon's first report since its March IPO, when its share price popped. Reddit's made a point of involving top users in its Wall Street-ification, setting aside 8% of its IPO shares for Redditors. The team spirit could quell concerns over how the platform may change as it looks to flip its losses ($91M last year, though revenue grew 21%) into its first-ever profit. The social co is much smaller than peers like Meta and Snap. 100-day hot streak… for your AI French lessons. Duolingo's been très populaire. In February, shares of the owl-helmed language-learning app soared 20% after it posted record quarterly user growth, revenue, and profit. As Duolingo leans into AI, last year it laid off 10% of its contractor workers (like translators). It says it's seen high demand for its paid ad-free tier, which uses OpenAI's ChatGPT-4 to offer custom lessons and chats with bots posing as virtual tourists. Wall Street expects Duo to report surging earnings on Wednesday.

Sponsored by Global X ETFs Every 39 seconds… A cyber attack occurs in the US, per 2023 data.* Governments know it's a high-stakes issue, which is why cybersecurity tech is attracting billions of dollars in spending at the national, state, and local levels. As demand increases for solutions to new security risks, individual investors have an opportunity to support this growing industry.  Mount a strong defense. Invest in BUG, the cybersecurity ETF from Global X ETFs.**

Zoom out

Stories we're watching Catch flights, not fees… Americans are going abroad for a discount. Japan — where the yen's value has plummeted versus the US dollar (nearly 160:1) — welcomed a record 3.1M tourists in March. The # of US tourists visiting Japan has jumped 50% in the past five years. Airlines like United and American have capitalized by adding direct routes to Tokyo, where tourists are snapping up luxury goods to get more bang for their buck. Economic tourism is also happening in Europe: some Americans flock to buy Chanel when the USD approaches parity with the euro. Welcome to RevenueLand… where roller coasters matter more than the movies they're based on. Disney, which reports this week, is all in on the amusement biz: parks was its most profitable division last year, pulling in ~$9B. The Mouse House is planning a $60B parks expansion over 10 years, building new "lands" tied to hot IP. Park rival Universal is readying Nintendo World, part of a new $1B theme park flush with Mario coasters. Nintendo also reports this week, as does Six Flags, which is finalizing its $8B merger with Knott's Berry Farm owner Cedar Fair.

Sponsored by Nasdaq The more you know… Nasdaq TotalView powers the need-to-know data serious investors rely on. In this quick 5-min read, Nasdaq covers the market data basics — from last sale to depth-of-book. Check it out.

9-to-9

Check out which countries' workers are out-grinding everyone else The CEO of Norway's wealth fund recently said "Americans just work harder" than Europeans, but which two nations are putting in the most and fewest hours at work? Check your answers here.

What else we're Snackin' Natty: With 18.7M paying subscribers, Planet Fitness averages 7.6K members per location. But its gyms couldn't fit all those folks. The chain, which generated $1.1B in rev last year, relies on members not working out. EVOO: The olive-oil industry's in crisis mode. Prices for the "liquid gold" have 3x'd since 2020 to record highs as extreme-weather events slash crop yields by up to 60%, leading to a shortage.  Disconnect: The Affordable Connectivity Program, a pandemic-era fund that subsidized WiFi bills for 23M US households, has halved its monthly subsidy. The ACP is set to run out of cash in weeks without funding.

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Snack Fact Of the Day Tickets for the Met Gala are going for $75K apiece, $25K more than last year Read more

This Week Monday: Pulitzer Prize winners announced. Met Gala. Earnings expected from Spirit Airlines, Loews, Tyson, Goodyear, Palantir, Lucid, Hims & Hers, and Microchip Tuesday: Consumer-credit data. Apple's "Let Loose" event. National Teacher Day. National Bike & Roll to School Day. Earnings expected from Disney, Reddit, Lyft, Kenvue, Kellogg, BP, Nintendo, Duke Energy, UBS, Match Group, Rivian, Twilio, Wynn Resorts, Ionis, Crocs, Tempur Sealy, Virgin Galactic, and TripAdvisor Wednesday: Olympic torch arrives in France. Blues Hall of Fame induction ceremony. Earnings expected from Uber, Airbnb, Fox Corp., News Corp., AB InBev, and Toyota Thursday: Unemployment data. Peabody Awards winners announced. Blues Music Awards. Earnings expected from Warner Bros. Discovery, Six Flags, Warner Music Group, Dropbox, H&R Block, Roblox, US Foods, Hyatt, and Groupon  Friday: University of Michigan preliminary consumer survey for May. Earnings expected from Honda Authors of this Snacks own shares of Apple, Amazon, Comcast, Disney, Match, Reddit, Snap, Uber, and Warner Music Group Important Information: *WatchGuard. (2023). There was a cyberattack every 39 seconds in 2023. WatchGuard **Investing involves risk, including the possible loss of principal. Cybersecurity Companies are subject to risks associated with additional regulatory oversight with regard to privacy/cybersecurity concerns. Declining or fluctuating subscription renewal rates for products/services or the loss or impairment of intellectual property rights could adversely affect profits. The investable universe of companies in which BUG may invest may be limited. The Fund invests in securities of companies engaged in Information Technology, which can be affected by rapid product obsolescence and intense industry competition. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from social, economic or political instability in other nations. BUG is non-diversified. Carefully consider the fund investment objectives, risk factors, charges, and expenses before investing. This and additional information can be found in the fund summary or full prospectus, which may be obtained by visiting globalxetfs.com. Please read the prospectus carefully before investing. BUG is distributed by SEI Investments Distribution Co. Nasdaq® is a registered trademark of Nasdaq, Inc. The information contained above is provided for informational and educational purposes only, and nothing contained herein should be construed as investment advice, either on behalf of a particular security, digital asset or an overall investment strategy. Neither Nasdaq, Inc. nor any of its affiliates makes any recommendation to buy or sell any security or digital asset or any representation about the financial condition of any company. Statements regarding Nasdaq-listed companies or Nasdaq proprietary indexes are not guarantees of future performance. Actual results may differ materially from those expressed or implied. Past performance is not indicative of future results. Investors should undertake their own due diligence and carefully evaluate companies before investing. ADVICE FROM A SECURITIES PROFESSIONAL IS STRONGLY ADVISED. © 2024. Nasdaq, Inc. All Rights Reserved.

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