🌮 “Perk-cession” problems

…and Uber’s freight biz could ride out of the company [Disclosures](   So long, ping-pong (Kim Kulish/Getty Images)   Yesterday’s Market Moves   Dow Jones 32,255 (-1.66%) S&P 500 3,918 (-1.85%) Nasdaq 11,338 (-2.05%) Bitcoin $20,341 (-6.25%) Dow Jones 32,255 (-1.66%) S&P 500 3,918 (-1.85%) Nasdaq 11,338 (-2.05%) Bitcoin $20,341 (-6.25%) Hey Snackers, There’s a rally happening and it’s not in stocks: boxes of the newest Girl Scouts cookie flavor, Raspberry Rally, are being [resold]( for up to 5X their usual price. Is there a Supply and Demand merit badge? Stocks sank yesterday after weekly jobless claims suggested the labor market was still hot ahead of today’s big February jobs report. Investors now think the Fed will next raise rates by 50 basis points, up from expectations of 25 last week. Perky The “perk-cession” has landed: companies are cutting back on employee benefits as profit takes precedence Farewell, unlimited kombucha tap… and free post-meeting Pilates. As corporations prioritize cost cuts, cushy employee perks that’ve long been used to attract talent are vanishing faster than tortillas at a build-your-own-taco happy hour. From Silicon Valley’s tech titans to Wall Street’s banking walruses, the “perk-cession” has arrived, The Wall Street Journal [reports](. - Companies are slashing benefits like barista-brewed coffee, fitness classes, pet insurance, extra PTO days, and catered meals. - Some examples: [Meta]( ended free laundry and dry cleaning, [Salesforce]( canceled its wellness retreat, and [Goldman Sachs]( nixed free cabs to the office. - Not just the fun stuff… About half of US companies plan to cut benefits like parental leave, childcare subsidies, and adoption programs, a new survey [suggested](. Hard fork… The perk-cession comes after mass layoffs at companies that are scaling back after hyper growth during the pandemic. Meta, famous for its cushy office perks, slashed 11K employees in the biggest layoff of the year so far. Beyond tech, banks like Goldman and [Citi]( and manufacturers like [GM]( and [Ford]( have announced reductions. - But the US job market is historically hot: In January there were nearly two open roles for each available worker, and unemployment was just 3.4%. - Unbalanced: But that’s largely thanks to the hospitality industry (think: hotels, restaurants), which became the US’s fastest-growing employer. THE TAKEAWAY Perk-cession is a symptom… of the efficiency bug. Instead of growth at all costs, the focus for many companies is now profit at less cost — which means “efficiency” is key. And ping-pong tables don’t exactly scream efficiency. Disappearing perks and layoffs are just a few symptoms of the profit focus, which could translate to better returns for investors. Meta shares popped after Zuck announced 2023 was the company’s “[year of efficiency]( Cargo Uber may spin off its truck-focused freight biz as the lockdown logistics boom cools Roadblock ahead… [Uber]( is [reportedly]( considering spinning off its freight division as the trucking industry hits some bumps. The ride-hailing leader launched Uber Freight in 2017, connecting semitruck drivers with companies that make high-volume deliveries (think: a truck full of Pepsi). Last quarter, Freight’s sales grew 43% to $1.5B, and made up nearly a fifth of Uber’s total revenue. But in January Uber Freight said it would cut 3% of its workforce as trucking cools. - Initial Truck Offering? Uber is said to be thinking of spinning off Freight as a separate publicly traded company, or just selling it altogether. But it’s TBD if either will happen. Slowing the (freight) train… During the pandemic, trucking was essential in delivering tons of backlogged goods across the nation. But as supply chains start to balance out, so has demand. Last quarter truckload freight deliveries fell 7%, the biggest drop since 2020. Now analysts say shippers will have to charge even less to stay competitive, which could eat into profits. - Delivery doldrums: [UPS]( warned its annual sales could fall for the first time since 2009, and rival [FedEx]( saw its quarterly profits dip. - Oh ship: Global shipping demand has also [dropped]( from pandemic highs. It now costs less than $1.5K to ship a container from China to LA vs. $15K a year ago. THE TAKEAWAY Sometimes you can do more with less… Ditching Freight could help Uber focus on its core ride-hail and food-delivery businesses, both of which saw record growth last quarter. While offering different services can be helpful, Uber may’ve realized it was diversified enough when its food-delivery biz helped offset a major ride-hail downturn during lockdowns. ORDINOT The Crypto Catch-Up… 💰 Costly… Crypto mega bank [Silvergate]( said it would [shut down]( after being forced to sell assets [at a loss]( to cover a rush of withdrawals post-FTX. The closure of crypto’s go-to bank could make it harder for industry players to move $$. 📜 Policy… CFTC Chair Rostin Behnam [said]( that ethereum and stablecoins are commodities — aka: should be regulated by his agency. Note: SEC Chair Gary Gensler likely disagrees. He's argued that all crypto (except [bitcoin]( may actually be a security. 🌶️ Spicy… Yuga Lab's bitcoin NFT (aka: [ordinal]( auction brought in $16.5M. But the creator of ordinals [blasted]( the process — which required that bidders send their BTC to Yuga — suggesting it could be abused by scammers. What else we're Snackin' - [UKant]( US and EU travelers will soon need to get pre-authorization to enter the UK. The stricter controls, which start next year, are meant to boost border security but could hurt tourism in hubs like London. - [GMoney]( GM said it’ll offer buyouts to most of its 58K salaried employees. The Chevy-making car giant said the buyouts would help it avoid "involuntary actions" (read: layoffs) as it works to cut $2B in costs. - [Taxy]( President Biden's proposed budget seeks to cut the US deficit by $3T over 10 years, largely by hiking taxes on corporations and the wealthy (think: people earning $400K+). It’s unlikely to be embraced by the GOP-controlled House. - [Walgones]( California, which this week pledged not to do business with [Walgreens]( said it would end a $54M contract with the chain. The move comes after Walgreens said it wouldn’t sell the abortion pill in 20 states. - [Mozart]( [Apple]( said it’s launching an app focused on classical music this month that will be free to Apple Music subscribers. The Beethoven bet could be a bid to eat away [Spotify]( lead. 🍪 Thanks for Snacking with us! Want to share the Snacks? Invite your friends to sign up [here](. Snack Fact Of the Day As of 2021, there were 4M more women in the US than men [Read more]( Friday - February jobs report Authors of this Snacks own bitcoin and ethereum and shares: of Apple, GM, and Uber ID: 2785067 Robinhood Snacks newsletters reflect the opinions of only the authors who are associated persons of Robinhood Financial LLC (Member [SIPC]( and do not reflect the views of Robinhood Markets, Inc. or any of its subsidiaries or affiliates. They are for informational purposes only, and are not a recommendation of an investment strategy or to buy or sell any security, digital asset (cryptocurrency, etc) in any account. They are also not research reports and are not intended to serve as the basis for any investment decision. 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