Raphael Stevens

Bernard Arnault, founder and CEO of LVMH, has made a string of artificial intelligence investments this year through his family office, called Aglaé Ventures.
The largest funding round this year, according to Fintrx, was in a firm called H, formerly known as Holistic AI, a French startup that’s working toward full artificial general intelligence.
While the amounts of Aglaé’s investments aren’t disclosed, the funding rounds for the AI firms totaled more than $300 million, according to Fintrx.

World’s top luxury group LVMH head Bernard Arnault presents the group’s annual results 2022 in Paris on January 26, 2023.
Stefano Rellandini | AFP | Getty Images

A version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide to the high-net-worth investor and consumer. Sign up to receive future editions, straight to your inbox.
Luxury king Bernard Arnault is shopping for AI companies.

Arnault, founder and CEO of LVMH and the world’s fourth-richest person with a net worth of $184 billion, has made a string of artificial intelligence investments this year through his tech-focused venture firm and family office, called Aglaé Ventures.
Aglaé made five AI-related investments in 2024, according to data provided exclusively to CNBC by Fintrx, the private wealth intelligence platform. While the amounts of Aglaé’s investments aren’t disclosed, the funding rounds for the AI firms totaled more than $300 million, according to Fintrx.
The largest funding round this year, according to Fintrx, was in a firm called H, formerly known as Holistic AI, a French startup that’s working toward full artificial general intelligence. It was founded by former members of Google’s DeepMind AI unit and includes venture firm Accel Partners LP and Wendy and Eric Schmidt, the former CEO of Google, as investors. The $220 million round in May, which also included Aglaé, valued H at $370 million, according to the company.

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Aglaé also invested in a $25 million seed round for Lamini, a Palo Alto, California-based startup building enterprise AI applications. In April, Aglaé was part of a $12 million series A round for Proxima, a New York-based AI-powered digital marketing company.
Aglaé joined Susquehanna to invest in the $27 million seed round for Toronto-based Borderless AI, a human resource management platform. And, it invested in Photoroom, a France-based AI image editor, as part of a $43 million investment round in February.

While many of Aglaé’s AI investments are recent, it invested in four funding rounds between 2017 and 2019 in Paris-based Meero, an AI-powered photo creation company, according to Fintrx.
The family office’s other investments this year were in Sonarverse, an Irvine, California-based blockchain company, and Shimmer, a San Francisco-based provider of ADHD coaching.
Since 2017, Aglaé has made a total of 153 investments, according to Fintrx data, with 53 in technology, 17 in consumer goods, 13 in business services and 12 in financial services.
Its other investments include Noom, a digital health platform, and World Music Media, a music creation app. Aglaé was part of multiple rounds of funding for Back Market, a French-based marketplace for refurbished electronics products that in 2022 reported a valuation of $5.7 billion.
Since the Arnault family fortune is so heavily concentrated in LVMH, with the family owning about 48% of the shares and controlling 64% of the voting rights, Aglaé has little reason to invest in luxury.
Arnault and his family are, however, big art collectors, and Aglaé was an investor in a $9.5 million funding round for LaCollection, a digital art platform. LVMH has expanded rapidly in the luxury watch segment and Aglaé was an investor in the $108 million funding round in 2021 for watch trading platform Chrono24.
While famous for his dedication to luxury craftsmanship, historic brands, and emotional connections to designs and artists, Arnault is also a big technology fan with a history of backing successful tech startups. His family office was an early investor in Netflix in 1999, Spotify in 2014 and Airbnb in 2015.
In a speech in May at the LVMH Innovation Awards, Arnault said he invested in 75 startups in the 1990s, and “some of them made it, but many didn’t.”
“The startup mentality is very close to our values: creativity, quality — it has to work — an entrepreneurial spirit and meaning,” he said.

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When Brian Niccol steps in as CEO of Starbucks, he’ll be tasked with fixing the chain’s operational issues.
Former CEO Howard Schultz has said the coffee chain’s mobile app is its biggest “Achilles heel.”
Chipotle, Niccol’s current employer, hasn’t faced the same issues because the company invested in its operations before its digital sales boom.

Mobile order and Uber Eats and Doordash delivery pick up area at Starbucks coffee shop, Queens, New York. 
Lindsey Nicholson | UCG | Universal Images Group | Getty Images

It’s become a familiar sight at Starbucks cafes: a counter crowded with mobile orders, frustrated customers waiting for the drinks they ordered and overwhelmed baristas trying to keep up with it all.
Fixing that problem will likely top incoming CEO Brian Niccol’s list of tasks to turn around the struggling coffee giant when he steps into the role on Sept. 9.

Investors and executives alike have pointed to operational issues as one reason the chain’s sales have lagged in recent quarters. Other culprits for its recent same-store sales declines include a weakening consumer, boycotts and the deterioration of the Starbucks brand.
Former CEO Howard Schultz, who lacks a formal role with the company but remains involved, has also pointed the finger at the mobile app. He said it has become “the biggest Achilles heel for Starbucks,” on an episode of the “Acquired” podcast in June.
Mobile orders account for roughly one-third of Starbucks’ total sales, and tend to be more complicated. While add-ons like cold foam or syrups are more profitable for Starbucks, they tend to take up more of baristas’ time, frustrating both them and customers.
“I agree with Howard Schultz,” said Robert Byrne, senior director of consumer research for Technomic, a restaurant market research firm. “This is not in the data — this is in the store. This is where the issue lies.”

Catching up to mobile growth

In late April, the current CEO Laxman Narasimhan said the company was struggling to meet demand in the morning — and scaring away some customers with long wait times.

Schultz said he experienced the problem himself when he visited a Chicago location at 8 a.m.
“Everyone shows up, and all of a sudden we got a mosh pit, and that’s not Starbucks,” Schultz said on the “Acquired” episode.
Making mobile orders more efficient is one of the key ways Niccol can reduce crowding at Starbucks.
When Schultz was building Starbucks to become the coffee behemoth it is today, he positioned it as a “third place” between work and home. Since then, the chain has lost that reputation as more customers lean on the convenience of mobile ordering and prefer not to linger at its cafes.
“Because it’s a beverage, and because I’m frequently consuming it in the car or on the go, it needs to be incredibly convenient,” Byrne said.
But Starbucks also didn’t make significant adjustments to its operations to anticipate that shift in consumer behavior.
In 2017, Schultz stepped down as CEO for the second time, handing the reins to Kevin Johnson. Prior to joining the coffee chain as its chief operating officer, Johnson served as chief executive of Juniper Networks, a tech company. Under his leadership, Starbucks invested in technology and kept growing digital sales, but restaurant operations were already struggling when he left the company.
Schultz stepped back in as interim CEO when Johnson retired in 2022.
“The company did not do a good job of anticipating the technological refinements that needed to be put in place to avoid what was happening. … The stock was at record high, the company was not investing ahead of the curve, not paying attention to the velocity of the mobile app and what it was becoming until it was too late,” Schultz said.
Shareholders have also experienced the frustration with digital orders — and see it as a critical area for Niccol to address.
“The problem you have in New York City, for example, is what is the wait time,” said Nancy Tengler, CEO and chief investment officer of Laffer Tengler Investments, which owns shares of both Starbucks and Chipotle. “And then the mobile orders taking precedence over the in-store orders. [Niccol’s] going to have to flip that somehow to get people to spend more time and more money in stores.”
The mobile-order issues have added pressure on baristas. Burnout, fueled in part by the app, helped inspire some employees to unionize, beginning in 2021.
This November, Starbucks Workers United, which now represents workers at roughly 450 of the chain’s U.S. stores, pressed the company to turn off mobile ordering when it’s running promotions. (Starbucks said at the time that it was already in the process of making the change possible.)

Channeling Chipotle’s strength

Digital sales aren’t the same albatross for Niccol’s current employer, Chipotle.
In its latest quarter, 35% of the company’s revenue came from online orders. The pandemic fueled a shift to online ordering that has stuck around, as the share of digital orders has jumped from 18% in 2019.
When Niccol joined Chipotle in 2018, most of its restaurants had already installed a second prep line dedicated to digital orders, aiming to avoid bottlenecks as online sales became more important to the business. That same year, it also began adding drive-thru lanes just for online order pickup, which it calls “Chipotlanes.”
In his six and a half years at Chipotle, Niccol and his executives boosted digital sales through different promotions: sports stars’ favorite orders, limited-time deals, a rewards program and the long-awaited launch of quesadillas. In particular, quesadillas became a digital-only option because they would otherwise slow down operations.
Chipotle has also been testing automation to make burrito bowls ordered through its mobile app through a partnership with robotics firm Hyphen.

Mobile makeover

Starbucks has been taking steps to speed up service and improve baristas’ work experience.
In 2022, under Schultz’s leadership, Starbucks introduced a reinvention plan that included tackling bottlenecks through new equipment and other measures to speed up service.
Narasimhan has largely stuck to that strategy. This February, its mobile app finally started showing customers the progress of their orders, giving them a better idea of when their drinks will be ready. And in late July, Starbucks rolled out its “Siren Craft System” across North America, a series of processes to make drinks faster and baristas’ jobs easier.
But the problem for Starbucks, could require more drastic measures.
For example, the equipment rollout has been slow, with roughly 40% of North American locations expected to install the new machines by the end of fiscal 2026. Speeding up that timeline could cut service times in half — as promised at the investor day in 2022 — and reduce the strain on baristas.
“It’s not an easy lift by any means to do that, like that’s going to take time and training and investment and [capital expenditure],” TD Cowen analyst Andrew Charles said.
“In our view, Brian has tremendous credibility, where if he tells investors, ‘This is the answer to the problem we’re having,’ and can explain why he believes that — he’s going to get a pass,” Charles said.

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Retail pharmacy chains such as Walgreens and CVS have pivoted from years of endless store expansions to shuttering hundreds of locations across the U.S. to shore up profits. 
Among the biggest problems has been falling reimbursement rates for prescription drugs and several factors pressuring the front of the store, such as inflation and increased competition.
Those drugstores remain an important fixture of the U.S. health-care system that tens of millions of Americans rely on, but they may need to reinvent themselves. 

The abundance of Walgreens and CVS Health stores makes them convenient for whenever Shriya Raghavan, a research associate based in Philadelphia, needs to pick up necessities like gum, deodorant and soap. 
But she said she often has to wait for employees to unlock cabinets or stand in lengthy lines to pick up prescriptions as pharmacists juggle tasks.

Those are just some of the ways Walgreens and CVS are falling out of favor with consumers, in a trend that has hit their profits and stock prices and forced them to reconsider their strategies. They are symptoms of deeper issues plaguing retail pharmacy chains, which pivoted from years of store expansions to shuttering hundreds of locations across the U.S. to shore up profits. 

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Shares of both CVS and Walgreens have tumbled in the last 10 years, but CVS has fared better among the two.

Among the biggest problems for the chains, reimbursement rates for prescription drugs have fallen. Inflation, softer consumer spending, theft, and competition from Amazon and grocery stores are also making it difficult for drugstores to turn a profit at the front of the store, where they sell everything from pantry staples to makeup and cleaning supplies.
There’s also widespread burnout among pharmacy staff, many of whom complain about understaffing and increasing workloads.
Many of those issues aren’t new. While CVS and Walgreens got a temporary boost from Covid vaccinations and test sales during the peak of the pandemic, they now face a harsh reality: the retail pharmacy model may be broken. 
“As things have started to normalize, we’re reverting back to the challenges that the retail pharmacy industry had faced even before Covid,” Jefferies analyst Brian Tanquilut told CNBC. “I think most of these pharmacies are realizing that fundamentally, their businesses have not really changed.” 

The exterior of a CVS pharmacy store is seen on August 07, 2024 in Austin, Texas. 
Brandon Bell | Getty Images

Falling retail pharmacy profit margins only add to the woes at both Walgreens and CVS. 
While Walgreens struggles with its push into primary care, CVS’ bottom line is getting battered by higher medical costs in its insurance business. CVS earlier this month slashed its full-year profit outlook for the third consecutive quarter and announced $2 billion in new cost cuts over several years as those higher medical costs squeeze the insurance industry. 
It’s not just those two chains: Rite Aid, once a viable competitor, declared bankruptcy last year and is closing hundreds of store locations as it restructures.
Wall Street hasn’t been happy. Shares of Walgreens are down nearly 60% this year and 80% over the last decade. CVS’ stock is down almost 30% both for this year and the last 10 years. Meanwhile, Rite Aid’s common stock was delisted from the New York Stock Exchange in October. 
Still, retail pharmacy chains remain an important fixture of the U.S. health-care system that tens of millions of Americans rely on. They may just need to reinvent themselves. 
“The retail pharmacy industry is going through a period of soul-searching, trying to understand the best model to reach the consumer,” said GlobalData retail managing director Neil Saunders. “Consumer habits have changed, some of the economics of running drugstores and pharmacies have changed and the retailers in the sector are really having to reappraise how they do business to maintain profitability and maintain a viable business model.”
Here are the main factors challenging the pharmacy business, and what CVS and Walgreens are doing to adapt.

Falling pharmacy reimbursement rates

Much of the pain for retail pharmacies comes from lower prescription drug reimbursement rates. 
Pharmacies typically buy their medications from a distributor and then get reimbursed by pharmacy benefit managers, or PBMs. The powerful drug supply middlemen also negotiate discounts with manufacturers on behalf of insurers and create lists of medications covered by health plans.
The three largest PBMs – CVS Health’s Caremark, UnitedHealth Group’s Optum Rx and Cigna’s Express Scripts – handle almost 80% of all prescriptions in the U.S.
Pharmacies have accused PBMs of setting lower reimbursement rates, which, in some cases, can mean pharmacies get paid less than the cost of buying and dispensing a prescription. Those middlemen are also accused of offering “take it or leave it” contracts when negotiating reimbursements with pharmacies, effectively forcing them to accept lower rates so they can maintain access to patients covered by PBMs. 
“There’s no leverage. There’s no negotiating power on the side of the retail pharmacies,” Tanquilut told CNBC. “So we’ve seen a consistent pressure on margins on the pharmacy side over the last several years to the point where that’s a huge challenge.” 
The operating margin for Walgreens’ U.S. retail pharmacy unit was -5% last year, down from 3.9% in 2019 and 4.4% in 2015. Meanwhile, CVS’ operating margin for its pharmacy and consumer wellness business was 4.6% last year, up from 3.3% in 2022 but down from 8.5% in 2019 and 9.9% in 2015.

CVS has a slight competitive advantage over Walgreens since it has its own PBM, and the margin pressure from Caremark is likely “not as severe” as it is for other PBMs, Tanquilut said.
CVS in December also introduced a new pharmacy reimbursement model called CostVantage, which will launch at the beginning of next year and use what the company calls a “transparent” formula to determine a medication’s price. A CVS spokesperson said it will provide more clarity and predictability for consumers.
But some analysts told CNBC that it’s still unclear how effective that new model will be.

Meanwhile, Saunders said more consumers are using online pharmacy services such as PillPack, a subsidiary of Amazon Pharmacy, to get their prescription medications. He noted that online pharmacy fulfillment remains “fairly small in the scheme of things,” but said it is “definitely growing and putting a little bit of pressure on some of the traditional pharmacy chains.”  

Front-of-store woes 

A Walgreens truck parks near a CVS Pharmacy on March 10, 2023 in New York City.
Leonardo Munoz | Corbis News | Getty Images

E-commerce rivals, discounters and big-box retailers are an even bigger threat to the retail side of Walgreens’ and CVS’ pharmacy businesses. 
As competition mounts, the chains’ online retail presence has also lagged behind those of Amazon and other retailers like Walmart and Target, according to Leerink Partners analyst Michael Cherny. 
“It wasn’t as likely that an individual pre-Covid, or even the early days of Covid, would think first and foremost of going to CVS.com or Walgreens.com for shopping,” Cherny said. “[CVS and Walgreens] were behind on e-commerce.” 
Inflation is also squeezing consumers, who have become more prudent with their purchases. A budget-conscious shopper is more likely to shop at retailers including Walmart, a dollar store or Costco, despite the convenience the retail pharmacies offer, Cherny noted.
Brittainy Lynn, a 38-year-old freelancer based in Austin, Texas, said it “seems like prices are really high” at Walgreens and CVS compared with other stores. 
“It is not my first choice,” Lynn told CNBC. “Walmart or Target is generally where I find things I need for the cheapest price. I do frequent Dollar Tree as well, but not really for essentials.” 
Walgreens and CVS have blamed weaker retail sales in part on consumers watching their spending.
Earlier this month, CVS said same-store sales at the front of the store were down roughly 4% during the second quarter from the same period a year ago, which reflects a “general softening of consumer demand.” 
Walgreens in June said same-store retail sales decreased 2.3% during the fiscal third quarter compared with the year-earlier period. The company said its U.S. retail pharmacy business faced “significant challenges” in a “worse-than-expected consumer environment.” 
Walgreens and CVS have both increased their focus on their private-label products to lure in shoppers who have traded down from national brands to beat inflation. 
In a statement, a Walgreens spokesperson said the company is seeing “strong success among our own brand products,” with brand penetration “growing quite nicely.” They added that the company is expanding its variety of products, adding 37 new items alone in the second quarter. That “perfectly complements consumer focus on value,” the spokesperson said.

Walgreens more exposed to retail pharmacy pressure

While the major chains face many of the same hurdles, Walgreens is likely more exposed to the pressures on its retail pharmacy business than CVS is, Evercore ISI analyst Elizabeth Anderson told CNBC. 
CVS operates a PBM and the nation’s third-largest health insurer, Aetna, which could help offset issues on the retail pharmacy side. 

Walgreens and VillageMD
Source: Walgreens

CVS’ retail pharmacy unit was the second-biggest contributor to sales last year, raking in $116.76 billion. The company’s health services segment, which operates Caremark and primary-care provider Oak Street Health, booked nearly $187 billion in sales. 
Meanwhile, Walgreens gets the vast majority of its revenue from its U.S. retail pharmacies. That business unit took in more than $109 billion last year, dwarfing the $21.83 billion from its international segment and nearly $1.8 billion from its health-care unit. 
Walgreens’ international segment operates more than 3,000 retail stores abroad, including locations of U.K.-based health and beauty retailer Boots. The company’s health-care unit offers primary care, urgent care and post-acute care services, as well as a specialty pharmacy, among other services. 
Even as Walgreens tries to diversify its business, the company has been “playing catch-up” with CVS in the health-care space, according to Jeffries’ Tanquilut. 
Retail giants and pharmacies have been pushing to deliver medical care directly to patients, which could help them capture a larger slice of the more than $4 trillion U.S. health-care industry. 
But several companies, including Amazon, Walmart, CVS and Walgreens, are feeling the pain from bets on primary care. That’s because building clinics requires a lot of capital, and the locations typically lose money for several years before becoming profitable, according to Tanquilut. 
Unlike CVS, Walgreens could potentially exit that market altogether. The company said in a securities filing last week it is considering a sale of its primary-care provider VillageMD.
Walgreens invested $1 billion in VillageMD in 2020, then another $5.2 billion a year later to become its majority owner. But Walgreens started closing clinic locations last year. In March, the company recorded a hefty nearly $6 billion charge related to the decline in value of its investment in VillageMD. 

What’s the future of the retail pharmacy? 

Retail pharmacies likely won’t disappear soon, especially as the American population ages and more people need to pick up prescriptions, Evercore’s Anderson said. 
But she said they may not need to “exist in their current form.” That could potentially mean increasing their online presence, no longer selling certain products like greeting cards and shrinking store footprints.
“I think there’ll be some experimentation with models there. It’s more of a question of what the new retail pharmacy model will look like,” Anderson told CNBC. 
Walgreens has opened roughly 100 smaller-format stores, which have fewer front-of-store items and over-the-counter medicines and feature the company’s branded products, a spokesperson said in a statement. Walgreens plans to add more “mini drugstores” this year.

Walgreens “mini-drugstores” being tested across the U.S. 
Courtesy: Walgreens

The company is also piloting a Chicago store location that focuses on “convenience and speed through digital pickup, pharmacy and grab-and-go solutions,” Walgreens said on its website. Most prescription or retail orders can be placed and filled at a counter, which could deter theft. 
Another location in Aubrey, Texas, moves the pharmacy to the front of the store in a departure from the traditional model.
The company’s website said it does not plan to roll out additional pilot stores until “learnings about what works and what doesn’t are better understood.” 

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Meanwhile, a CVS spokesperson said the company is “innovating to meet our customers’ and patients’ varying needs.” The spokesperson pointed to the company’s private-label brands, assortment of national brands, and loyalty program that offers discounts and benefits for patients. 
The company has also opened Oak Street Health primary-care centers side by side with CVS pharmacies in Texas and Illinois, with plans to introduce around two dozen more by the end of the year. 

Shuttering stores to shore up profits

In the meantime, CVS and Walgreens are cutting costs. 
Walgreens in June announced plans to shutter a “significant” number of its 8,600 U.S. stores. The company’s CEO, Tim Wentworth, said only 75% of the chain’s locations were profitable, and that a significant portion of the other quarter could shutter by 2027.
In a statement, a Walgreens spokesperson said, “We have recently exhibited the ability to, and will continue to make difficult decisions that benefit our business, as we identify opportunities that unlock value, validate existing pathways and lead [Walgreens] into a successful future.”
In 2021, CVS announced it was shuttering 900 stores, or nearly 10% of its U.S. retail locations, over a three-year period. CVS executives earlier this month said the company is on track to meet that goal by the end of the year, with 851 stores closed to date. 
In a statement, a CVS spokesperson said the store closure decisions are based on population shifts, consumer spending patterns and a given community’s store density, among other factors. Even after the closures, 85% of people in the U.S. will still live within 10 miles of a CVS pharmacy, the spokesperson noted.
Amar Singh, senior director at retail consulting company Kantar Group, said shuttering underperforming locations could help Walgreens and CVS right-size their business and figure out “the right equation” for their stores that will win back shoppers and shore up profits. 
But store closures could make it harder for many Americans to get prescriptions, as pharmacy deserts become more common in underserved communities across the U.S. 
They also may do little to fix some of the deeper issues plaguing retail pharmacies, according to Saunders. For example, he said addressing declining pharmacy reimbursement rates may require legislation and lobbying, and “getting that done is almost possible.” 
“In some ways, closing stores is a reaction to the problem. It’s not the solution to the problem,” Saunders said. “But longer term, if other things don’t change, they’ll probably find themselves in the same position in 10 years time where they have to close more stores.”  More

SpaceX is preparing to launch its next private mission from Florida on Aug. 26, and it will be the company’s first attempt at a spacewalk.
The four-person crew is made of billionaire and Shift4 founder Jared Isaacman, his colleague Scott Poteet, and a pair of SpaceX employees, Anna Menon and Sarah Gillis.
The Polaris Dawn mission is the first of three flights Isaacman purchased from SpaceX in 2022 for his human spaceflight effort known as the Polaris Program.

Polaris Dawn commander Jared Isaacman during spacesuit testing.
John Kraus / Polaris Program

SpaceX is preparing to launch its next private mission by the end of the month, featuring the first attempt to have the astronauts step out into space.
The Polaris Dawn mission — the first of three flights billionaire and Shift4 founder Jared Isaacman purchased from SpaceX in 2022 for his human spaceflight effort known as the Polaris Program — is set to launch from Florida in the early hours of Aug. 26.

“We don’t get the freedom of any time of day to launch but I think it’ll work out to [be] pretty close to dawn, which is very appropriate given the mission,” Isaacman told CNBC’s Investing in Space during an interview last month.

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Isaacman will be commanding the mission, as he did while leading the historic Inspiration4 flight in 2021. He’s once again leading a crew of four, with longtime colleague Scott Poteet joining him as the pilot and Anna Menon and Sarah Gillis, a pair of SpaceX employees, serving as the flight’s medical officer and mission specialist, respectively.
The multi-day trip isn’t headed to a destination, but instead will be a free-flying mission tracing orbits that the crew hopes will go far from Earth.
“We’re going to a very high altitude that humans haven’t gone to in 50-plus years,” Isaacman said.

The Polaris Dawn crew, from left: Anna Menon, Scott Poteet, Jared Isaacman, and Sarah Gillis.

But the centerpiece of Polaris Dawn is the planned spacewalk.

Extravehicular activities, or EVAs, have been a regular part of NASA’s astronaut missions for years, such as when the agency needs maintenance done outside the International Space Station. But no private venture has attempted an EVA before.
Isaacman said he understands that going for a spacewalk means he and his crew will “surrounded by death,” a moment for which they’ve been training extensively.
“The only thing that comes close to that is the vacuum chamber, and that’s where you’re pretty much feeling as close as it’s like to be in the vacuum conditions or space. … That definitely gives you the actual sensations of the pressure changes and the temperature changes, as well as just the psychological stressors of being in a very harsh environment,” Isaacman said.

Five day mission plan

The Polaris Dawn mission crew, from left: Medical officer Anna Menon, pilot Scott Poteet, commander Jared Isaacman, and mission specialist Sarah Gillis.
Polaris Program / John Kraus

Isaacman also detailed the day-to-day schedule for Polaris Dawn, which will be in space for up to five days.
Day one is all about looking for a time when there’s minimal risk from micrometeorite orbital debris, which will determine exactly when Polaris Dawn will launch. After reaching an orbit of 190 kilometers by 1,200 kilometers, Isaacman said the crew will do extensive checks of SpaceX’s Dragon capsule Resilience.
“It’s really important to know that the vehicle has no faults before going up to 1,400 kilometers” altitude, Isaacman said.
The spacecraft will also take early passes through the high radiation zone known as the South Atlantic Anomaly.
“You ideally want to take that at the lowest altitude as you can because even down at 200 kilometers, the radiation level there is substantially higher … Our two or three passes at high altitude through the South Atlantic Anomaly will be almost the entirety of the radiation load on the mission and like an equivalency of three months on the International Space Station,” Isaacman said.
Day two will focus on some of the science and research that Polaris Dawn plans to accomplish — which will total about 40 experiments. The crew will also prep for the spacewalk, testing out the EVA suits.
“So we can make sure that … there’s nothing unexpected in microgravity versus what we were able to test on Earth,” Isaacman said.
Day three is the big one: The EVA.

The spacewalk

So who on the crew will perform the spacewalk?
“We’d say all four of us are doing it — there’s no airlock and it’s being vented down to vacuum” inside the spacecraft, Isaacman said.
Two of the crew will journey outside of Dragon: Isaacman and Gillis, while Poteet and Menon stay inside as support.
The EVA is expected to last two hours long from start to finish. Isaacman stressed that the spacewalk “is really a test and development” process.
“We want to learn as much as we can about the suit and the operation as possible, but we only have so much oxygen and nitrogen to work with,” Isaacman said.
Polaris Dawn plans to livestream the spacewalk, and the mission commander emphasized that there are going to be “a lot of cameras” scattered inside and out of the capsule.

Brand new spacesuits

A SpaceX extravehicular activity (EVA) suit during testing on June 24, 2024.
John Kraus / Polaris Program

The crucial piece of equipment intended to make the EVA possible is SpaceX’s spacesuits.
The company has spent the past couple years taking its minimalist-looking, black-and-white IVA suit —meaning intravehicular activity, and worn by astronauts in case of emergencies — and using it to create its EVA suit. Isaacman said the EVA suits are the results of hundreds of hours of testing different materials over years.
“So our primary goal is learn as much as we can about the suit,” Isaacman said.
“Everything is about building the next generation. We’re continuing to iterate on this suit design so that SpaceX can have hundreds or thousands someday for the moon, Mars, working in [low Earth orbit], what have you. Building a new EVA suit is no easy task,” he added.

Polaris Dawn medical specialist Anna Menon during spacesuit testing.
John Kraus / Polaris Program

Polaris Dawn aims to push the boundaries of private spaceflight and, like his first trip to orbit, Isaacman hopes the mission inspires.
“This is the inspiration side of it … anything that’s different than what we’ve seen over the last 20 or 30 years is what gets people excited, thinking: ‘Well if this is what I’m seeing today, I wonder what tomorrow’s gonna look like or a year after.”
Read Isaacman’s Q&A with CNBC’s Investing in Space newsletter here. More

A more health-conscious younger consumer and an aging older demographic are contributing to a growing interest in nonalcoholic drinks, according to Nielsen IQ, and to the rise of a niche subset called “functional beverages.” 
Functional beverages are nonalcoholic drinks that go beyond basic hydration or the nostalgic taste factor for alcohol that non-alcoholic beer and mocktails often target.
Many are marketed as having specific health and cognitive benefits, and some include substances such as THC for their mood-altering properties.
Although interest is surging, the legality behind the drinks remains undefined and at times reliant on legal loopholes.

Mimi Lam, co-founder and chief executive officer of Superette, arranges cannabis-infused beverages at the Superette Sip ‘N’ Smoke cannabis dispensary in Toronto, Ontario, Canada, on Monday, Oct. 25, 2021. 
Della Robbins | Bloomberg | Getty Images

More Americans are looking for alcohol alternatives, and beverage makers that tout the health benefits of their drinks are trying to capitalize on that.
More than 40% of Americans say they are trying to drink less alcohol in 2024, a jump from 34% a year prior, according to recent figures from data insights company NCSolutions. The number goes up to 61% for Generation Z, compared with the 40% of that age group who said they planned to drink less in 2023. 

As younger consumers grow more health conscious and generations that typically drink more get older, interest in nonalcoholic drinks has climbed, according to Sherry Frey, a wellness expert at Nielsen IQ. That has helped fuel the rise of so-called functional beverages.
Functional beverages are drinks that aim to go beyond hydration or the nostalgic taste for alcohol that nonalcoholic beer and mocktails often target. Many include adaptogens, herbs that are marketed as having specific health and cognitive benefits, while others include substances such as THC, the psychoactive ingredient in cannabis, for their mood-altering properties.
The drinks surged in popularity after the pandemic, crowding grocery store aisles and then appearing on restaurant and bar menus. 
The phenomenon is worldwide. The global functional beverages market is expected to reach $249.5 billion by 2026, according to 2022 research by Euromonitor.
Functional beverages retail sales in the U.S. topped $9 billion in the 52 weeks ending March 30, according to the latest data from NielsenIQ, almost 10% of total beverages. The numbers exclude cannabis drinks.

“People want to have an experience, and once brands are able to create sustainable, consistent, effective, comparable experiences, I think the majority of the market share is going to move away from [alcohol] alternatives to functional [alcohol] alternatives,” Aaron Nosbisch, founder of cannabis and adaptogenic drinks company Brez, told CNBC.
But the growth of functional beverages doesn’t signal the end of alcohol consumption. Around 80% of those who buy nonalcoholic beverages also buy drinks that contain alcohol, according to consulting firm BCG, based on research from NielsenIQ.
“Yes, there’s some cannibalization of existing beer, wine and spirits products” but not a total replacement of them, Nic Zhou, BCG managing director and partner, told CNBC.
“People are drinking [functional beverages] because they want more choices,” Zhou said. “They want to be able to socialize and look cool, feel part of the group, but not necessarily have to consume alcohol.”

Younger consumers drive the trend

Younger consumers are fueling functional drinks. Alcoholic beverage penetration among Gen Z consumers over 21 was the lowest among all generations, according to the latest data from Numerator. 
But Zhou said it’s too early to tell whether the trend will last, or if it’s a product of coming of age during the pandemic, when there were fewer opportunities to socialize in a group setting with alcohol.
Frey added that interest from older generations shouldn’t be discounted. 
“We all focus on the younger generation always,” Frey said. ” But when you think about how much [baby boomers] are worth in terms of their spend and the fact that they are reducing alcohol and looking for other alternatives, I think it’s a really important element as well.”
Jake Bullock, founder and CEO of cannabis drink company Cann, said consumers now have more health and wellness information available than ever on devices such as Apple Watches or iPhones. He said he believes the data is “encouraging people to consider the harms of alcohol in a way that we never would have 20 years ago.”

Consumers are looking for health benefits 

Consumer health and wellness concerns spiked during the pandemic, and the trend has not gone away, Frey said. She added Nielsen IQ’s research, done every six months, finds health and wellness is a top priority for consumers. But the concerns have evolved from wanting to cure specific ailments to aiming to increase general well-being in order to live longer and better, according to Nielsen data.
Frey said the shift has piqued interest in functional beverages. Drinks that promote higher energy levels, better digestive and brain health and mood-enhancing benefits are among the most popular. 
Three-quarters of respondents to a 2023 survey by Datassential said they believed functional foods and beverages would help them live longer and be healthier without having to radically change their diet. 
“Consumers are looking for products that do more than one thing for them. So if you can achieve a great taste, but also some functional benefit, you’re adding more value,” Jordan Bass, CEO and founder of adaptogenic beer alternative brand Hop Wtr, told CNBC.
Hop Wtr was co-founded by Nick Taranto, an ex-Marine turned competitive athlete, and Bass, who said he was training for a triathlon at the time. The duo loved “to crack open a cold beer” but wanted a nonalcoholic alternative that would relax them without the health drawbacks of alcohol, Bass said.
Hop Wtr was initially marketed as a beer alternative due to its hoppy flavor. But Bass said the company’s marketing shifted after it saw data showing wide consumer interest in functional beverages.
The drink includes several adaptogens and nootropics. Adaptogens are herbs such as ashwagandha that advocates claim help the body’s response to stress, anxiety and fatigue. Nootropics are popular substances such as L-theanine and caffeine that are claimed to improve mood and provide focus and energy.
“Adaptogens and functionals are marketing terms that were invented that mean drugs for sober people,” joked bartender Elliott Edge.
Edge is a bartender and manager at Hekate, a witchcraft-themed sober bar in the East Village neighborhood of New York City. Hekate was the first sober bar in the city when it opened in January 2022.
Owner Abby Ehmann initially thought she would have to make everything from scratch, but said she was pleasantly surprised to find that over time, new alcohol-alternative products started popping up “like every week.”
The bar stays busy — especially during Sober October and Dry January, when, Edge says, “If you smile in here, your cheeks will touch someone else’s.” Customers range from 80-year-old locals to New York University undergraduates, and not all of them are sober, Edge added.
Alcohol is the original functional drink. People use it to change their mood or act as a social lubricant, and centuries ago they drank it for supposed health benefits, from aiding digestion to warding off the plague. But as more consumers worry about negative health effects of alcohol, Edge has found that people are open to trying many alternatives.
“People are curious. It seems like they are tired of relying exclusively on something like alcohol for the moods and feelings they want, which are calmness but also sociability,” Edge said.
Functional drinks serve as not only a potentially healthier substitute for alcohol but also for sodas, as consumers grow more wary of sugar.
But like the health benefit claims made about vitamins and supplements, a lot of the claims by beverage makers are not subject to FDA review. 
“It’s certainly not a straightforward space where you can take everything at face value,” Zhou said.
This uncertainty is already leading to legal trouble. Poppi, a functional soda touting digestive benefits, is now facing a lawsuit challenging its claims of prebiotic benefits.
In a statement to CNBC, a Poppi spokesperson said the company stands behind the product.
“We believe the lawsuit is baseless and we will vigorously defend against these allegations,” Poppi told CNBC.

The rise of cannabis drinks

A problem with most nonalcoholic beer and spirits is that you get the taste but “none of the fun,” Brez founder Nosbisch said. People who want to be healthier and eliminate hangovers don’t necessarily want to give up the “social buzz” of alcohol.
“So I think a lot of our success is coming from people actually looking for a true alcohol alternative: something that doesn’t just taste like alcohol but actually gives them a kick,” Nosbisch said.
Cann’s Bullock agreed, saying that the company’s biggest customer group is “the healthy hedonists.” 
“These are the people that are closing down the dance floor but then also at their morning workout class,” Bullock told CNBC.
Gen Z is also leading the trend in THC-infused beverage adoption, according to another survey from Numerator.
Cannabis drinks provide a way to consume THC and CBD in microdoses, similar to how consumers regularly drink alcohol or coffee. That allows the drinker to pace themselves, with effects that kick in and wear off more quickly than with edibles.
This makes the experience more appealing to non-cannabis users, companies say. Eighty percent of Brez customers are non-cannabis users who are looking for a true alcohol alternative, Nosbisch said, adding that he thinks the real business opportunity is in gaining market share from alcohol. 
“We sit at the intersection of sober curiosity and cannabis curiosity,” Bullock said.
Cann launched in 2019 in cannabis dispensaries. But as legalization spreads, it now sells to more than 3,000 points of distribution including liquor stores and convenience stores, on top of the 60% of its sales that comes direct to the consumer via its website. The company has seen 60% growth year over year and has sold more than 9 million cans since its launch, a number it expects to match this year alone.
Zhou said the buy-in from big beverage manufacturers will determine whether consumer behavior will shift for good. And that will depend on the extent of cannabis legalization.
Cannabis market revenue is forecast to reach $42.98 billion in 2024. Growth potential is increasing as President Joe Biden’s administration moves to ease federal restrictions on marijuana and reclassify it to be placed alongside drugs such as Tylenol with codeine, and testosterone. 
Marijuana is still illegal at the federal level, so the cannabis drinks use THC derived from hemp. While there are limits on the amount of THC in hemp pre-harvest, there aren’t any for the products made from the plant.
That’s only one of the safety questions the functional beverage industry will have to figure out as it grows.
“If we’re going to introduce all these functional alternatives, then how do we ensure safety in that process, and that’s what’s going to unfold in this next chapter,” Nosbisch said. More

United Auto Workers President Shawn Fain ratcheted up criticism of Stellantis CEO Carlos Tavares in a video Friday afternoon.
Fain accused the chief executive of price gouging consumers and failing to uphold parts of the union’s labor contract with the automaker.
The comments are the latest in an ongoing back-and-forth between Fain and Tavares following contentious collective bargaining talks last year.

UAW President Shawn Fain chairs the 2023 Special Elections Collective Bargaining Convention in Detroit, Michigan, U.S., March 27, 2023. 
Rebecca Cook | Reuters

DETROIT – United Auto Workers President Shawn Fain ratcheted up criticism of Stellantis CEO Carlos Tavares in a video Friday afternoon, accusing the chief executive of price gouging consumers and failing to uphold parts of the union’s labor contract with the automaker.
The comments are the latest in an ongoing back-and-forth between the CEO and union leader following contentious collective bargaining talks last year between the UAW and Detroit automakers, including Stellantis.

“Something is rotten at Stellantis,” Fain said to begin the 2:30-minute video posted Friday. “Sales are down, profits are down, and CEO pay is way, way up. The problem isn’t the market at GM and Ford, auto sales are up, and the problem isn’t the auto workers. The problem is this man, Carlos Tavares.”
Spokespeople for the union and automaker did not immediately respond for comment regarding the accusations or video.
Several of the criticisms, including those around job cuts and Tarvares’ pay, aren’t new. But Fain’s comments Friday took the claims a step further, accusing Tavares of price gouging consumers in the name of profits. He also alleges that Stellantis is not honoring parts of the company’s worker contract, citing specifically that Stellantis is halting plans to reopen an assembly plat in Illinois.
“Fact, for years, Stellantis has sold fewer cars, but made more in profits. What does that tell you? They’re price gouging. Now they’ve gone too far, and they’re tanking their own sales,” Fain said. “Fact, Stellantis CEO Carlos Tavares is trying to go back on commitments the company made in our last contract, including putting the brakes on reopening the Belvedere Assembly.”
Tavares recently criticized the UAW-Stellantis workforce, noting quality problems at a truck plant in metro Detroit producing the Ram 1500 pickup truck. The company also has announced thousands of layoffs at U.S. plants amid declining sales and product changes.

“The direct run rate of some of our plans starting with SHAP, Sterling Heights, is not good,” Tavares told reporters July 25 while discussing ongoing issues with the company. “That is something that we need to fix with our plant management team as well with our people.”

Stellantis CEO Carlos Tavares speaks to media on June 13, 2024 following the company’s investor day at its North American headquarters in Auburn Hills, Mich.
Michael Wayland / CNBC

Tavares has been on a cost-cutting mission since the company was formed through a merger between Fiat Chrysler and France’s PSA Groupe in January 2021. It’s part of his “Dare Forward 2030” plan to increase profits and double revenue to 300 billion euros ($325 billion) by 2030.
The cost-saving measures have included reshaping the company’s supply chain and operations as well as headcount reductions for both salaried and hourly workers.
Stellantis has reduced headcount by 15.5%, or roughly 47,500 employees, between December 2019 and the end of 2023, including a 14.5% reduction in North America, according to public filings. That doesn’t include further headcount reductions and layoffs this year.
Several executives previously described the cuts to CNBC as grueling to the point of excessiveness. Tavares last month pushed back on the idea that the company’s cost-cutting efforts have led to its current problems. More