Business

The Ig Nobel awards, an annual ceremony for laugh-out-loud scientific papers, celebrate the joyfully improbable nature of much academic research. One of this year’s Ig Nobel winners, “Factors involved in the ejection of milk”, was published in 1941 and tests whether fear causes cows to involuntarily drain their udders. Its authors drew their conclusions by placing a cat on a cow’s back and repeatedly exploding paper bags beside it. “Genetic determinism and hemispheric influence in hair whorl formation”, another winner, asks whether hair tends to swirl in the same direction depending on which hemisphere you live in. More

It is hard to imagine a place where Jim Farley, boss of Ford, might feel more comfortable discussing his company’s future than at the wheel of one of his firm’s vehicles. Mr Farley, pictured, whose driving skills have been honed racing Ford Mustangs in his spare time, fields questions with the same assurance that he pilots a Transit van down a winding Austrian mountain road. The three-day road trip in late August, from Ford’s European headquarters in Germany to Italy, in a convoy of four Transits, was arranged by Mr Farley to assess in detail one of the firm’s best-selling vehicles as well as to meet dealers and customers along the way. More

The FaceGym studio in central London looks more like a hair salon than a fitness studio. Customers recline on chairs while staff pummel their faces with squishy balls. They use their knuckles to “warm up” skin and muscles; give it a “cardio” session to improve circulation; and then a deep-tissue massage. Customers, who spend at least £100 ($133), say they leave with less puffy cheeks and more defined jaw lines. More

For years shareholders have paid little heed to the thunderbolts hurled at America’s west-coast technology giants by the trustbusting deities of Washington, DC. No longer. Despite expectations of solidly rising profits, the share price of Alphabet, Google’s parent company, is wobbling (see chart). More

QVC is becoming the exclusive broadcaster of USA Pickleball as the home shopping network owner looks to experiment with sports and bulk up its streaming platform.
QVC will also be the exclusive retail industry partner of USA Pickleball as part of the multiyear partnership.
The streaming platform of QVC will exclusively stream the 2024 Biofreeze USA Pickleball National Championships in November.

Thomas Wilson prepares to hit a shot from Ross Whittaker and Christopher Haworth during the first round of the Pro Mens Doubles at the 2023 BioFreeze USA Pickleball National Championships held at the Brookhaven Country Club on November 8, 2023 in Dallas, Texas.
Bruce Yeung | Getty Images Sport | Getty Images

QVC, the owner of home shopping networks on TV and streaming, has signed a deal with USA Pickleball to bring the sport to its platforms.
In a multiyear partnership, QVC has acquired the exclusive broadcast rights of USA Pickleball, the national governing body of the sport. The deal begins with USA Pickleball’s 2024 Biofreeze USA Pickleball National Championships in November, which will be featured on QVC’s free streaming platform, QVC+/HSN+.

QVC, a subsidiary of John Malone’s Qurate Retail Group, will mix the shopping experience with the live matchups. As part of the partnership, QVC will also be the exclusive retail industry partner of USA Pickleball.
The deal showcases the media industry’s continued gravitation toward live sports, which attract some of the biggest audiences on both traditional TV and streaming.
In QVC’s case, the choice to bring on pickleball was intentional.
Earlier this year QVC launched a new brand platform called “Age of Possibility,” geared to women over 50, said Annette Dunleavy, QVC’s vice president of brand marketing.
“Pickleball is the fastest-growing sport in America and really resonates with that demographic,” said Dunleavy. “We thought, what two perfect partners to come together. We wanted to partner with them to sort of bring the sport to life in a different and unique way for our audience.”

Pickleball has been booming in the U.S. and has been called the country’s fastest-growing sport. More than 5 million women over the age of 45 actively play the sport, according to QVC and USA Pickleball.
Pickleball courts have been popping up across major cities in the U.S. Meanwhile, the sport has been signing big media rights deals, such as the partnership of the Professional Pickleball Association Tour and The Tennis Channel.
As QVC builds out its streaming platform it has been experimenting with live shows and events, including its “The Ultimate Gift Wrapping Challenge” series and actress Busy Philipps’ late-night talk show, “Busy This Week.”
“As you look at what those relevant, highly successful examples of media have been, it’s live sports,” said Stacie Tedesco, vice president of streaming at Qurate Retail Group. “It was really that perfect next place to go.”

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Starbucks is investing in two new farms in Central America to get closer to a goal of protecting its coffee supply from climate change.
The coffee giant buys 3% of the world’s coffee supply, which has been pressured in recent years due to extreme weather.
At the two new farms, Starbucks will study how its hybrid coffee varieties perform at different elevations and soil conditions.

A sign outside of the Starbucks headquarters is seen at Starbucks Center on July 3, 2024 in Seattle, Washington.
David Ryder | Getty Images

More than a decade ago, Starbucks bought its first coffee farm, in Costa Rica. Now the coffee giant has added two more to its portfolio.
The Seattle-based company said Thursday that it’s invested in another farm in Costa Rica and its first in Guatemala in the hopes of getting closer to its goal of protecting its coffee supply from climate change.

Rising temperatures, frosts in Brazil, three consecutive years of La Nina and other extreme weather have been hurting coffee production in recent years, putting pressure on supply. For Starbucks, which buys 3% of the world’s coffee, the shortages can mean scrambling to find Arabica beans — and higher prices for its customers. Consumer coffee prices have risen 18% over the last five years as of August, according to the Bureau of Labor Statistics.
“Frosts in Brazil have already impacted volumes of up to 50%, so we can have really severe impact in terms of product availability, and that is more and more regular in the whole Coffee Belt,” said Roberto Vega, Starbucks vice president of global coffee agronomy, research and development and sustainability.
The Coffee Belt refers to the equatorial region with the ideal conditions to grow coffee beans.

A worker cuts and collects coffee fruits in a coffee plantation in Heredia, Costa Rica, on February 3, 2023. 
Ezequiel Becerra | AFP | Getty Images

At the two new farms, Starbucks will study how hybrid coffee varieties perform at different elevations and soil conditions. The hybrid plants’ attributes include higher productivity and resistance against coffee leaf rust, a fungus that thrives in higher temperatures and rainfall.
“We can develop new hybrids, but the fact that a hybrid works in one country and under certain conditions doesn’t mean that it’s going to be working everywhere,” Vega said.

Vega’s team is also hoping to tackle other challenges faced by its coffee farmers that aren’t the direct result of climate change.
For example, the company’s new Guatemalan farm is small, with depleted soil and low productivity. Starbucks is hoping to stage a turnaround by recovering its soil and then will use those learnings to teach other farmers how to do the same.
“The farm is not necessarily in good shape, and that’s exactly what we were looking for. We wanted a farm that really mirrors the challenges that farmers are having today,” Vega said.
At the second farm in Costa Rica, which is located next to its existing Hacienda Alsacia, Starbucks plans to use drones, mechanization and other tech to address the labor shortages faced by many Latin American farmers.
Starbucks eventually plans to buy two more farms in Africa and Asia, stretching its agricultural portfolio across the Coffee Belt. More

The gridlocked streets of India’s big cities are not blocked to everything. Tiny scooters laden with packages slip past cars, jump traffic lights and bounce over what pavements exist. Goods range from a tub of ice cream or a handful of pomegranate seeds to a coffee pot or even an iPhone. Such two-wheeled delivery services have taken off over the past four years, often promising to bring items in ten minutes in cities where it can take that time to cross a busy street. More

Levi Strauss delivered mixed quarterly results and said it was looking to sell its Dockers business.
The denim maker is seeing strong gains in its namesake brand and Beyond Yoga but sales at Dockers plunged 15% during the quarter.
Levi’s focus on direct selling, plus lower cotton costs, led its gross margin to grow by 4.4 percentage points.

Justin Sullivan | Getty Images

Denim-crazed consumers are turning to Levi Strauss & Co for new jeans, but the company’s overall business is being dragged down by its Dockers brand, which the company is now considering selling off, it announced Wednesday. 
Sales at Levi’s brand were up 5% during its fiscal third quarter — the biggest gain in two years — but overall revenue came in flat and lower than Wall Street had expected. 

Shares of Levi’s fell more than 8% in extended trading Wednesday.
Here’s how the denim-maker performed compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

Earnings per share: 33 cents adjusted vs. 31 cents expected 
Revenue: $1.52 billion vs. $1.55 billion expected

The company’s reported net income for the three-month period that ended Aug. 25 was $20.7 million, or 5 cents per share, compared with $9.6 million, or 2 cents per share, a year earlier. Excluding one-time items, Levi’s posted earnings of $132 million, or 33 cents per share. 
Sales came in at $1.52 billion, up slightly from $1.51 billion a year earlier. 
With one quarter left to go in the fiscal year, Levi reaffirmed its full-year adjusted earnings per share guidance of $1.17 to $1.27, in line with expectations of $1.25, according to LSEG. It expects earnings per share to come in at the midpoint of that range.

It trimmed its revenue guidance and is now expecting sales to grow 1%, compared to a previous range of between 1% and 3%. That’s below the 2.3% growth that analysts had expected, according to LSEG.

So long, Dockers

Levi’s, which owns its namesake brand, as well as Dockers and Beyond Yoga, would have printed quite a different set of results had it not been for Dockers. It started that brand in 1986 to offer consumers an alternative to denim: khakis. 
Throughout the 1990s and 2000s, khakis were a mainstay in most consumers’ closets but these days, it has fallen out of fashion. The efforts that Levi’s has made to differentiate Dockers led to too much overlap with the Levi’s brand, which has expanded into a lifestyle brand that offers a lot more products than jeans.
During the quarter, sales at Dockers were down 15% to $73.7 million while Beyond Yoga, the buzzy athleisure brand it acquired in 2021, saw sales grow 19% to $32.2 million. 
“Over the last couple of years, the brand has underperformed. … We felt this was the right decision for the long term. Our view financially is the exit of Dockers will improve the company’s overall margins and also minimize volatility in top line growth,” Levi’s finance chief Harmit Singh told CNBC in an interview. “We believe the exit of Dockers will allow both Dockers and Levi’s to independently operate and maximize each other’s value independently.” 
Levi’s has tapped Bank of America to lead the sale process. 

Direct gains

Beyond Docker’s, Levi’s is making gains in growing its profitability as it continues to shift its focus to selling directly to consumers.
During the quarter, its gross margin rose by 4.4 percentage points, which Singh attributed to the direct-selling strategy, lower cotton costs and better products that didn’t need to be marked down to be sold. 
Like other brands, Levi’s has been working to carve out its direct selling strategy and reach more customers through its own stores and websites rather than through wholesalers like Macy’s. The strategy is a boon to profits because the margins are higher and it also allows brands to get closer to their customers through data collection.
During the quarter, Levi’s direct channel was up about 10%, driven by strength in the U.S. and 16% growth in e-commerce. Overall, direct sales comprised 44% of total revenue and Levi’s wants to get that number closer to 55%.
Behind those numbers are a slew of splashy marketing campaigns, which include a new partnership the jeans brand announced with Beyoncé on Monday after the pop star released a song titled “LEVII’S JEANS” earlier this year on her country album.
“Our strategic decision was to actually have Beyoncé represent some of our core product. So in the first ad, chapter one, she’s in … 501s and an essential white t-shirt and it doesn’t get more Levi’s than that,” CEO Michelle Gass told CNBC. “Part of the success recipe for Levi’s has been and will continue to be us living in the center of culture and bringing together the icon of Beyoncé with the icon of Levi’s, I don’t think there’s any better example of that.”

Global woes

Sales in Levi’s Europe business came in higher than expected at $406.6 million, ahead of StreetAccount estimates of $392 million, but sales in the Americas and Asia came in lower. Levi’s posted $757.2 million in sales in the Americas, below the the $789.2 million that StreetAccount analysts had expected. In Asia, Levi’s saw revenue of $247.1 million, below StreetAccount estimates of $258 million. 
“China was a drag,” Singh said of the region, which represents about 2% of Levi’s overall business. “It’s got this macro headwinds, and we had some execution issues. We’ve just changed the leadership in China and over time we still believe in the long-term potential of China.”
In the Americas, beyond a slowdown at Docker’s, sales were also impacted by one of Levi’s largest wholesale customers in Mexico, Singh said. During the quarter, the partner had a cybersecurity breach, which constrained shipping times and impacted sales. The region is also working through some “execution issues,” said Singh. More