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THE HEADLINES
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Toys R Us plans to pull the plug on 180 stores, representing 20% of its brick and mortar outlets. The last holdout among big box toy retailers (RIP FAO Schwartz) filed for bankruptcy just before the holidays.
The business equivalent of raising the white flag was the product of crippling debt ($5B) and years of mismanagement. And things aren’t exactly looking up for Geoffrey the Giraffe post-bankruptcy. Apparently even St. Nick prefers Amazon to brick and mortar retail as Toys R Us reported lackluster holiday sales.
CEO Dave Brandon promises to turn the company around with co-branded baby and toy stores, smaller retail spaces, in-store experiences and a lot fewer liabilities on the balance sheet.
Do it for the kids
More than half of the 180 closures will be Babies R Us stores. To right the ship at the fledgling offspring outlet, the company plans to push their baby-registry business, presumably because customers feel bad for and are therefore inclined to purchase big ticket items for expecting parents.
Water Cooler Talking Point: “It could be worse, you could be Mattress Firm. The conspiracy theory that Mattress Firm is one massive money laundering operation has been festering in the bowels of the internet for a while. But recently whispers grew louder as news spread of Mattress Firm’s parent, Steinhoff, admitting to accounting discrepancies.”
TIME TO SETTLE UP
When it comes to innovation the NBA has been in a full court press compared to its American sports league counterparts. And their stance on gambling is nothing short of unprecedented. The league wants sports betting available to more fans, via kiosks and phones, not just accessible to the degenerates that journey to casinos and racetracks.
But there is a catch. The NBA is also proposing a 1% cut of any wagers made on its games. Nevada alone raked in over $4.5B of gambling revenue in 2016, which means that the league would stand to net a pretty penny for doing next to nothing.
If you include all bets, not just the legal ones, gambling revenue is estimated to be between $100B to $200B annually. That’s a tough number to ignore when you’re hell-bent on making money by any means necessary and increasing your fan’s engagement. We’re looking at you, NFL.
Water Cooler Talking Point: “Adam Silver is not an intimidating guy by any sense of the word, but if he showed up at my apartment with a Shaq, Rasheed Wallace and a baseball bat looking for his cash, you bet your ass I’m digging through my couch cushions to pay my debt.”
MEG GOES MOBILE
Meg Whitman is officially stepping down as CEO of Hewlett Packard Enterprise Feb. 1, after announcing her decision late last year to leave the company. But she doesn’t have any plans to enjoy funemployment. Whitman will join Jeffrey Katzenberg’s media startup, WndrCo as CEO.
If you haven’t heard of Whitman before, just look up the word boss. This lady takes no prisoners. She was the CEO of eBay, a Disney board member and was even in the running for the Uber CEO job.
The Wndr of it all
Former Dreamworks CEO, Jeffrey Katzenberg, has one goal: high quality mobile TV for all. His vision is to create original content, all under 10 minutes in length. Think: the Vine of streaming content.
“NewTV,” a subsidiary of WndrCo. is looking to raise between $1B and $2B in order to produce a full content catalog. That’s where Whitman comes in. Gonna need some help knocking on all those doors.
Water Cooler Talking Point: “I hate to be THAT guy, but there’s a little company called Netflix that already allows me to stream HD quality content on my phone. Plus I use my cousin’s ex-wife’s login so I don’t have to pay for it.”
IN OTHER NEWS
- Google’s parent company is launching a cyber security firm called Chronicle. You mean to tell me that expired McAfee antivirus software isn’t cutting it for Fortune 500 companies?
- Qualcomm was hit with a $1.2B fine in the EU for making payments to Apple that ensured chip exclusivity in iPhones. Bribe, the word you’re looking for is bribe.
- The SEC opens a probe into GE’s accounting practices stemming from inconsistencies related to long-term service contracts. The investigation is in its early stages but GE has been accused of wrongdoing in the past.
- Starbucks will invest $250M in employee benefits and pay. The news is yet another reaction to recent US tax cuts. Maybe they can invest some of that in teaching employees how to spell common English language names on cups.
- Apple unveils a medical record feature for its Health app. The service will allow you to easily gather your health records through partnerships with clinics and hospitals. Now you can prove to your Tinder date that you’re not a diseased cesspool of a human being if things start getting hot and heavy.
- LG announces that it will increase prices of washing machines due to the oddly specific tariff that the White House will impose on them. Other companies are expected to follow suit. No word on if Trump shares a similar disdain for clothes dryers.
- US indices were mixed yesterday:
- DOW: +0.16%
- S&P 500: -0.06%
- NASDAQ: -0.61%
TALKING SHOP
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OMG, IT’S SO BIG (DATA)
CEOs go to Davos to do two things: sip Cristal and tell poor people how to live their lives. And they’re about to run out of Cristal.
Brian Moynihan, Bank of America CEO, and self-appointed, unsolicited career advice peddler has some news for the proletariat: big data is here to stay. BriMo offers up the following RE: what is going to make people successful in the future job market:
- Absorb tremendous amounts of data
- Intellectually asses said data
- Incite action based on the data
… says the guy with 200k employees to crunch data for him.
But all resentment aside, there is some real value to what Moynihan has to say. In a world where data is more readily available than opiods, its important to be able to interpret and make analysis actionable. Because if we don’t the robots will.