Axios Closer

July 27, 2021
Today's newsletter is 635 words ... 2 minutes.
🔔 The dashboard: The S&P 500 fell 0.5%. Keep reading for the latest on Big Tech earnings.
- Biggest gainer? Enterprise software maker F5 Networks (+6%). It says it's seeing continued pandemic-driven demand for digital business applications.
- Biggest decliner? Lamb Weston Holdings (-13%). Restaurant demand for its frozen potato products jumped, but it warned about "significant inflation."
1 big thing: Shipping chaos ripples
A container at the Port of Los Angeles, which became the first in the Western Hemisphere to process 10 million container units in a 12-month period. (Photo: Brittany Murray/MediaNews Group/Long Beach Press-Telegram via Getty Images)
Companies are pulling out all stops to get stuff from overseas. But almost everywhere they turn, they're confronted with delays.
Why it matters: The holdups have amounted to emptier shelves and pricier items, complicating the nation's economic recovery.
The big picture: The chaos is rippling out to other ports — the critical entry points for goods — and rails. It means there's little give in the global shipping system that's been walloped by the pandemic.
- The number of ships (stocked with clothing, shoes and more) lined up waiting to dock at Los Angeles and Long Beach — the country's busiest ports — has eased, shipping consultant Daniel Hackett wrote in an email.
- But "the lines are growing elsewhere (Oakland and Vancouver, for example)."
Case in point: Hasbro is sending goods to more ports to "expedite the delivery of our products," CFO Deb Thomas said Monday during a call with Wall Street analysts. The company still expects delays.
- Worth noting: Hasbro expects ocean freight costs to quadruple from last year. (Yes, toy-buyers will shoulder that cost.)
Meantime, railroad giants Union Pacific and BNSF this month temporarily paused pickups from West Coast ports to catch up on their own backlog — an inflection point for congestion.
Where it stands: Delayed ships last month had to wait an average of five days out at sea before unloading cargo at the Port of Los Angeles last month, a port spokesperson tells Axios.
- That's down from a bigger share of ships that waited eight days in March. Before the pandemic, ships rarely had to wait at all.
2. Charted: Pressure on at Activision Blizzard

Employees will hold a walkout tomorrow in protest of widespread harassment allegations across video game maker Activision Blizzard, Axios' Megan Farokhmanesh reports.
Flashback: California filed a lawsuit last week over the "World of Warcraft" maker's allegedly sexist culture.
How it's playing out: Shares of Activision Blizzard dropped 7% today (alongside a slide in the broad stock market).
3. Speed round: Big Tech edition
Illustration: Eniola Odetunde/Axios
The first batch of quarterly results from America's biggest tech companies is out. Here's what you need to know, via Axios' Hope King ...
Apple: Amid a continuing chip shortage and for what’s typically the slowest quarter for the company even pre-pandemic, Apple still managed to bring in $8.1 billion more in sales than estimated.
Alphabet: The company blew past sales expectations by close to $5.7 billion thanks in part to YouTube ads revenue, which nearly doubled.
Microsoft: Cloud services, including Azure, continued to drive results — growing 30% from last year.
The bottom line: So far, Big Tech has more than trumped Wall Street’s expectations for blowout results.
- Facebook releases results tomorrow, and Amazon comes on Thursday.
4. What’s moving
☕Starbucks same-store sales jumped 10% from this time in 2019, with nearly two-thirds of its drink sales coming from cold beverages. (CNBC)
📦 UPS said it's seeing a continued surge in e-commerce orders, even as the economy starts to reopen. The stock closed down 7%. (Marketwatch)
📚Walmart says it will fully cover college tuition and textbook fees for employees attending certain schools. (Axios)
5. 🐟 Fish vanishes from menus
Commercial fisherman Bob Maharry, right, and deckhand Drake Hoffman guide a basket of Dungeness crabs while unloading at Safe Coast Seafoods in San Francisco, Calif. on March 18, 2021. Photo: Stephen Lam/San Francisco Chronicle via Getty Images
Higher seafood costs are pushing some restaurants to yank fish off the menu completely, Axios' Erin Doherty writes.
- Seafood prices rose about 11% in the 12 months through early July from the previous period, per Bloomberg.
What they're saying: Atlanta chef Josue Pena pulled scallops, Alaskan halibut and blue crab from his restaurant's offerings.
- "[T]he price we had to charge to be profitable was almost insulting," Pena told Bloomberg.
6. What they’re saying
"[Martin] Shkreli has been held accountable and paid the price for lying and stealing from investors to enrich himself. With today’s sale of this one-of-a-kind album, his payment of the forfeiture is now complete."— Acting U.S. Attorney for Brooklyn Jacquelyn Kasulis announcing the government's sale of the one-of-a-kind Wu-Tang Clan album Shkreli forfeited. No word on who bought it (or for how much).
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Catch up on the day's biggest business stories and look ahead to important trends. Led by Nathan Bomey.


