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๐Ÿš— Uber’s endless surge pricing


Waiting for the surge pricing to end like… [FluxFactory/E+ via GettyImages]

Yesterday’s Market Moves
Dow Jones
34,575 (+0.13%)
S&P 500
4,202 (-0.05%)
13,736 (+0.09%)
$36,233 (-1.07%)

Hey Snackers,

After "I do," these couples will be saying "I meme it." That's right: meme-based dating has finally arrived.

Stocks barely budged yesterday as investors chewed on manufacturing data: rising commodity prices and shortages are putting a damper on activity.


The Great Uber Shortage: ride-hail prices and wait times are soaring on driver scarcity

Checked both Uber and Lyft… then checked the bus schedule. If you were one of the 7M people who passed through TSA during Memorial Day weekend, there's a good chance you Ubered/Lyfted from the airport. There's also a good chance that your rides broke the bank. ICYMI: surge pricing is the new regular pricing.

  • +40%: How much the cost of an Uber/Lyft ride was up in April, according to one research firm. In March, prices surged 37%.

Your Uber is 24 minutes away dope. Uber and Lyft are dealing with major driver shortages, which is boosting prices and wait times. Half of Americans are vaxed, the CDC lifted its mask mandate for FVPs (fully vaxed peeps), and Shot Girl Summer is starting. Ride-hailers don't have enough drivers to meet rebounding demand.

  • Why drivers aren't returning: President Biden extended the $300 extra/week unemployment benefit through September, and 42% of people on unemployment now earn more than they did at their jobs. Plus, childcare and corona concerns are keeping workers home.
  • Why prices are rising: Uber/Lyft are offering large bonuses and running ad campaigns to get people driving — in addition to jacking up prices for rides.
  • It's not just an Uber thing: Prices are rising across many industries, from food to cars, as the US economy revs back up and shortages abound. In April, a key inflation indicator rose a faster-than-expected 3.1%.

The gig economy is in an awkward phase… Ride-flation addresses Uber and Lyft's biggest PR issue: not paying drivers enough. More than other types of companies, Uber/Lyft can easily pass on extra costs to consumers. Now, drivers are getting paid more — but customers aren't happy. Long-term, higher fares may cause customers to shift to other modes of transport. That's why Uber/Lyft are trying to solve the shortage before riders do.


Canopy gets high on "beyond the flower" growth — but it has a big buzz-killer

A cushy earnings report… Canadian pot giant Canopy Growth revealed that sales were 37% higher in its latest fiscal year. Canopy is finally selling more pot than it harvests, and still holds the #1 spot in Canada's “flower” market (flower = weed). The buzz kill: Canopy lost $1.7B, but says it's still on track to turn a profit next year. Despite strong growth across categories, earnings missed expectations and the stock fell 7% yesterday.

Looking beyond the flower… Canopy's goal of "unleashing the power of cannabis to improve lives" goes beyond leafy greens. Canopy has been leaning into "beyond the flower" products. Think: CBD wellness gummies and THC iced tea. It's even selling CBD pet snacks with Martha Stewart (for when your Schnauzer is stressed after work). "Beyond the flower" is thriving: Canopy's "Other" category saw the fastest growth last quarter.

  • Beverages: Canopy launched a portfolio of THC drinks in Canada, capturing a 35% dollar share of the entire category.
  • Edibles: From Sativa and Strawberry soft chews to cannabis-infused chocolates, Canopy is growing its line of edible treats.
  • Vapes: Canopy expanded its marijuana and CBD vape pen and cartridge offerings with the acquisition of Ace Valley.

Legalization is still a big "if"… Despite being one of the biggest weed companies, Canopy's yearly sales were just $450M — less than 1% of Bud-maker AB InBev's annual sales. To really grow, Canopy and other cannabis cos need marijuana to be federally legalized in the US — it's still as illegal as LSD at the federal level. While cannabis companies try to hash it out with the US government, "beyond the flower" products like CBD edibles and drinks will be key to growth. The CBD market is expected to grow to $13.4B by 2028, from $3.5B today.

What else we're Snackin'
  • Beef: JBS, aka: Earth's largest meat supplier, was forced to shut down all its US beef plants after a major cyberattack.
  • Zoomy: Zoom reported blowout quarterly earnings, with sales nearly tripling from last year — but it warned that a slowdown is coming.
  • Gas: Oil prices jumped to a two-year high after OPEC and its allies forecast higher demand and boosted output.
  • Unmusked: The SEC said that Elon's "too high" Tesla tweets violated his settlement agreement, according to WSJ.
  • AMSold: AMC sold 8.5M new shares for $230M to capitalize on its latest stock surge.
  • Clubby: Audio-based social app Clubhouse hit 2M Android users, less than a month after it began rolling out to Google's OS.

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Authors of this Snacks own shares of: Uber and Tesla

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