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THE HEADLINES

Estimated Read Time: 3 minutes and 28 seconds

 

SUB-PAR

Subway sandwiches are a hole in one outside of the US, apparently. The home of Eating Fresh is planning to shutter as many as 500 stores in the US as it eyes global expansion plans. Upwards of 1k stores in Mexico, China, India, and the UK are in the works.

The sad, mid-week, al-desko lunch mainstay is the largest food franchise in the world, with over 40k locations. But it has come under increasing pressure from the likes of fast-casual joints (think: Chipotle and Panera). Plus the seven-dollar footlong just doesn’t have the same mystique.

But the sandwich shop with its own patented scent isn’t going down without a fight. Subway recently launched fresh concept stores and a new rewards program.

Water Cooler Talking Point: “Subway has had a rough few years … first, news outlets claimed they used rubber products to make their bread, then there was the Jared nightmare and finally, who can forget the 11-inch footlong debacle? Their survival is proof that if you build a mediocre enough product, they (read: overweight Americans) will come.”

 

SEWING HIS OATS

It appears that America has yet again halted its German adversaries: Deutsche Bank is planning to significantly scale back its US investment bank operations.

On the heels of net profit plummeting 79% in Q1, new CEO Christian Sewing plans to cut up to 10% of Deutsche Bank’s US workforce and refocus on European markets.

If American bulge bracket investment banks are Ferrari’s, Deutsche Bank is your single uncle’s used Miata. The once proud(ish) Wall Street mainstay is a shell of its former self, facing issues dating back to the financial crisis and more recently taking a beating thanks to the Markets in Financial Instruments Directive.

Water Cooler Talking Point: “Here’s a fun fact: crypto exchange Binance is more profitable than Germany’s biggest bank. So what’s the only thing keeping Christian Sewing from throwing himself off of a bridge right now? The fact that it could be worse, he could be heading up Wells Fargo.”

 

THE REVOLUT-ION BEGINS

If digital banking is cool (hint: it is), consider Revolut Miles Davis. The UK-based DB (Digital Bank) is just the latest example of fintechs being pumped full of investment dollars. Cali based tech investment firm DST Global led the $250M fundraising round.

Revolut’s main product is a digital payment account that provides the ability to seamlessly pay in different currencies without exchange fees. Because if you’re still paying exchange fees after the G6 touches down in a foreign country, you’re doing it wrong.

The company reports 2M customers to date, including 250k daily users, and 900k users active on a monthly basis. In the next 5 years, they are targeting 100M customers, using the investment dollars to expand in US, Canada, and Australia.

Revolut has raised $340M in total bringing their valuation to $1.7B in just 3 years of operation.

Water Cooler Talking Point: “Are THAT many people really transacting in foreign currencies so frequently that they need a whole new banking system? Call me old-fashioned but when I go abroad I go to my bank to exchange currency for cappuccinos or gyros.”

 

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IN OTHER NEWS

 

• Back in the summer of ’69 (ok, so it was December). That’s the last time US initial jobless claims were this low (209k).
• Amazon’s revenue hit its highest mark in six years and the little e-commerce platform that could topped $1B in profit for the second straight quarter.
• Snap is giving it another go with its Spectacles. After selling only 220k pairs of V1, Spiegel and Co. hope a less flashy version will make a splash.
• The government is urging Wells Fargo to investigate allegations of employees forcing IRA account holders into more expensive alternatives that would make the bank more money. This is so surprising … said no one ever.
• Nintendos current CEO, Tatsumi Kimishima, will step down in June and Shuntaro Furukawa will take the reigns. You could say they’re Switching things up.
• US indices were up yesterday:
  • DOW: +0.99%
  • S&P 500: +1.04%
  • NASDAQ: +1.64%