• Shake Shack's CEO said rising egg costs will have an impact on the F&B industry.
• He said food chains will offer more beef and chicken products as they grapple with the egg crisis.
• In January, the average price of a dozen large Grade A eggs hit an all-time high of $4.95.

Shake Shack's CEO, Rob Lynch, says food chains will likely introduce more chicken and beef menu items as the price of eggs soars.

On the company's fourth-quarter earnings call on Thursday, Lynch discussed the impact of tariffs and imports on the burger chain's business.

Lynch said the company sources the majority of its ingredients domestically and won't have major exposure to tariffs.

Thanks to its menu, it is largely insulated from the skyrocketing price of eggs as well.

"I mean we don't have a breakfast business, a big breakfast business. So we don't have the exposure to eggs," Lynch said.

"But other restaurant companies that have exposure to eggs may be moving away from eggs in the time being, which means they are going to offer more beef products or chicken products to complement, to substitute for that high-cost item," he said.

Shake Shack is known for its beef, chicken, and mushroom burgers, as well as its fries and frozen custard shakes. While eggs don't play heavily into its menu, fast food giants from Chick-fil-A and Taco Bell to McDonald's and Burger King rely on eggs for some of their popular breakfast menu items.

Lynch's comments come as egg prices in the US soar. Prices increased by 15.2% from December to January, the largest monthly spike in 10 years. In January, the average price of a dozen large Grade A eggs in the country hit an all-time high of $4.95.

The surge was caused due to supply chain issues stemming from a H5N1 bird flu outbreak in the US. The flu has forced farmers to cull infected birds, leading to egg shortages.

Chains like Costco have seen egg cartons fly off their shelves minutes after store openings. Grocery stores like Whole Foods, Trader Joe's, and Costco have imposed limits on the number of cartons each customer can purchase. Earlier this month, Waffle House started adding a 50-cent surcharge to each egg it sells.

Shake Shack, which started as a hot dog kiosk in New York City's Madison Square Park in 2004, has over 570 locations worldwide, including more than 370 outlets in the US.

The chain posted a total quarterly revenue of $329 million, up 14.8% from the same quarter in 2023. This included $317 million of company-operated sales and about $12 million from licensing revenue.

The company's stock was up 11% at market close on Thursday. It's up more than 27% in the past year.

Representatives for Shake Shack did not respond to a request for comment from Business Insider.

• Starbucks is moving away from clear plastic cups in some locations.
• It has introduced opaque cups for its hot and cold drinks in 14 states.
• It's a big change for a brand known for its Instagrammable drinks.

Starbucks has rolled out opaque cups for its drinks in some states, marking a shift in presentation for a brand that's become known for designed-for-Instagram drinks.

A representative for the chain told BI that a "small number of stores" in the US transitioned to using "commercially compostable hot and cold cups because of local government requirements." The change went into effect on February 11 in 14 states, including California, Washington, and Massachusetts.

As of the end of December, the chain had over 17,000 stores across the US.

The new cups — which are white and feature flat or domed lids — look similar to the disposable paper cups the chain has historically used for to-go hot drinks. They bear the message, "This cup is compostable. Cheers to helping reduce waste together."

The website says they are made from fiber-based paper board with a bioplastic liner.

The move to opaque cups is a shift for a brand known for colorful drinks that often go viral on social media.

In 2019, Starbucks launched a limited-time-only drink, the Tie-Dye Frappuccino, a fruity drink with rainbow colors. Other notable — and Instagrammable — limited launches include the bright purple Unicorn Frappuccino in 2017 and the turquoise Crystal Ball Frappuccino in 2018.

Starbucks also sells some colorful items on its permanent menu, such as its magenta-colored Refreshers and its Chocolate-Covered Strawberry Crème Frappuccino Blended Beverage.

Mário Braz de Matos, the cofounder of the Singapore-based branding consultancy agency Flying Fish Lab, told BI that changing a product's packaging can "greatly impact a brand" from an experience and perception perspective.

"That's why brands are usually very careful to test any packaging changes that might significantly impact the user experience," he said.

"While there will be an impact on how 'Instagrammable' the beverages are in this new packaging, this must be weighed against its positive environmental impact," he said.

The transition to opaque compostable cups comes as Starbucks' CEO, Brian Niccol, attempts to reposition the brand and turn it into an inviting coffee shop where people want to spend time.

The brand has evolved significantly from its origins as a low-key Seattle coffee shop. In a podcast interview earlier this month, Niccol said mobile ordering has "chipped away" at the brand's "soul."

Niccol, who took over leadership of Starbucks in September, has said he will be simplifying the chain's offerings. In an earnings call on January 28, he said Starbucks had brought back using reusable ceramic mugs for hot drinks served in stores.

On the call, Niccol and Starbucks' finance chief also said the chain would remove 30% of its menu items to streamline service and introduce a new algorithm to smooth service for its mobile orders.

Starbucks' stock was trading at $112 early Thursday. It is up about 17% compared to a year ago.

• KFC is moving out of Kentucky.
• Yum Brands said that it would shift its brands into offices in Texas and California.
• It said that it would also ask 90 of its US-based remote employees to return to the office.

KFC is shifting its US headquarters from Kentucky to Texas.

KFC's parent company Yum Brands said in a press release on Tuesday that the group would designate two brand headquarters in the US — one in Plano, Texas, and one in Irvine, California.

The relocation marks a shift away from the fried chicken chain's roots in Kentucky. Yum Brands' current headquarters is in Louisville, Kentucky.

The group said in the release that the shift in headquarters was to "foster greater collaboration among brands and employees."

However, Yum Brands and the KFC Foundation would maintain corporate offices in Louisville, the release said.

The company said it would also ask KFC's US-based corporate office employees — who are currently working in Louisville — to relocate to the Plano headquarters.

About 90 remote employees will also be called back to the office. The release said that they would be relocated to "the campus where their work happens."

"The relocation of approximately 100 KFC U.S. corporate roles will occur over the next six months, while the relocation of 90 remote positions will take place over the next 18 months," the release read.

Yum Brands is the parent company of four food and beverage chains — KFC, Taco Bell, Pizza Hut, and Habit Burger & Grill.

There are over 4,100 KFC stores in the US. KFC's website wrote that globally, the store count exceeds 30,000 in more than 145 countries.

The group released its fourth-quarter earnings on February 6, reporting an 8% sales growth globally, with KFC's sales growing 6%.

Yum Brands' stock is up about 10% from the start of the year.

Representatives for KFC did not respond to a request for comment from Business Insider, sent outside regular business hours.

• Tesla is hiring for roles based in Mumbai, India.
• The recruitment efforts come just days after Elon Musk met with Indian Prime Minister Narendra Modi.
• Tesla has long sought to break into India, the world's third-largest auto market.

Tesla is amping up its recruitment efforts in India just days after the country's prime minister, Narendra Modi, met with Elon Musk.

Tesla listed 13 roles based in Mumbai on its careers page. The positions were also advertised on the company's LinkedIn page on Monday.

The roles range across three categories — vehicle service, sales and customer support, and operations and business support.

All the listings show that the jobs, which are a mix of full time and part time roles, are based out of suburban Mumbai.

The listings also hinted at the opening of a Tesla store and a delivery center in India. For instance, the "Store Manager" listing says the new hire will be "responsible for overseeing and driving sales and sales operations."

Tesla is also hiring people for delivery operations work. Staff under this designation are expected to "oversee and coordinate administrative responsibilities at the delivery center."

Musk met with Modi in Washington on Thursday. The Indian premier also met with President Donald Trump during his two-day visit to the US.

It is unclear if Modi and Musk discussed Tesla's entry into the Indian market during their meeting. Modi wrote in an X post on Thursday that he had a "very good meeting" with the Tesla CEO.

"We discussed various issues, including those he is passionate about such as space, mobility, technology and innovation," Modi added.

Trump told reporters on Thursday that while he wasn't sure why Musk had met Modi, he assumed it was because Musk "wants to do business in India."

Representatives for Tesla did not respond to a request for comment from Business Insider.

Tesla has been planning to enter the Indian market for close to a decade. In April 2016, the company started accepting pre-orders for its vehicles.

Then, in January 2021, Tesla registered a company in India, just weeks after the country's transport minister, Nitin Gadkari, said Tesla would launch its operations there in early 2021. India is the world's third-largest auto market.

But those plans were put on hold. Musk said in July 2021 it was difficult for Tesla to break into the Indian market because the country's "import duties are the highest in the world by far of any large country."

"Still working through a lot of challenges with the government," Musk wrote in an X post in January 2022 when asked if Tesla was still planning to launch in India.

In March, India lowered its import taxes on EVs made by companies that commit to invest at least $500 million and start making cars in the country within three years.

Musk was scheduled to visit India in April and announce Tesla's entry into the country. However, the trip was postponed at the last minute.

"Unfortunately, very heavy Tesla obligations require that the visit to India be delayed, but I do very much look forward to visiting later this year," Musk wrote in an X post in April.

• A Delta Air Lines plane flipped with 80 people on board as it landed in Toronto Monday.
• The Bombardier CRJ900 was flying from Minneapolis, operated by Delta's Endeavor Air.
• The airline said Monday evening 18 customers with injuries were transported to hospitals.

A Delta Air Lines jet flipped with 80 people on board as it landed at a Toronto airport Monday, leaving emergency crews scrambling to reach the injured in the upside-down aircraft.

All passengers and crew were "accounted for," Toronto Pearson International Airport said. Delta Air Lines said 18 injured people were taken to hospitals. A Peel Regional Police spokesperson said the Greater Toronto Airports Authority was investigating.

Photos on X appeared to show the plane upside down and at least one wing missing. More photos of the wreck trickled out later. Delta said there were 76 passengers and four crew on board.

"Initial reports indicate there are no fatalities and 18 customers with injuries have been transported to area hospitals. Our primary focus is taking care of those impacted," Delta said Monday at around 5:40 p.,m. ET.

At around 10:30 p.m. ET, the company said, "Some of the customers initially transported to area hospitals have been released."

Ornge, an air ambulance service in Ontario, told Business Insider that three people were transported to Toronto hospitals with critical injuries, including a child, a man in his 60s, and a woman in her 40s.

The Bombardier CRJ900, which was flying from Minneapolis as Flight 4819, was operated by Delta's wholly-owned regional subsidiary, Endeavor Air.

"Everything just kind of went sideways," Pete Carlson, a passenger on the flight, told Canada's national broadcaster CBC.

"One minute you're landing, kind of waiting to see your friends and your people, and the next minute you're physically upside down," he said.

Carlson described the sound of "cement and metal" as the plane crashed.

Flights to Toronto Pearson were halted due to the emergency but resumed at 5 p.m. local time. More than 330 flights were delayed on Monday, and nearly 400 flights were canceled, per FlightAware, a flight-tracking website.

"The airport remains open. Passengers are advised to check their flight status before coming to the airport," the airport wrote in an X post on Monday night.

Delta said that it is working with customers flying from, to, or through Toronto and that customers should check their flight status via the Delta app.

US Secretary of Transportation Sean Duffy said in an X post that investigators with the Federal Aviation Administration were traveling to Toronto and that the Transportation Safety Board of Canada would lead the investigation.

Canada's transport minister Anita Anand thanked first responders and airport staff in an X post. In an earlier post, she said she had spoken to Duffy about the crash and that the FAA was sending investigators to support the Transportation Safety Board of Canada.

A bad few months for aviation safety

The Delta incident comes two and a half weeks after an American Airlines flight collided with a military Black Hawk helicopter over Washington D.C., killing 67 people.

The event in Toronto highlights the ongoing concerns over aviation safety. Despite the incident happening in Canada, the plane was operated by a US airline regulated by the FAA.

On Monday, the Trump Administration fired hundreds of FAA staff, according to the workers' union, including people in the safety department.

Among those fired was Jason King, whose work directly involved addressessing safety concerns, the Washington television station, WUSA, reported.

He said his team's work included investigating the midair collision over D.C.

The Delta and American flights join a string of aviation safety events since December. An Azerbaijan Airlines Embraer plane crashed on Christmas Day in Kazakhstan, with some blaming Russian air defenses. Thirty-eight people died.

A few days later, a Boeing 737 operated by the South Korean budget carrier Jeju Air crashed in South Korea. 179 people died, and two people survived.

A small general aviation plane crashed in Pennsylvania a few days after the American accident, killing six on the plane and one on the ground.

And on February 6, an Alaskan regional airline crashed in western Alaska, killing 10 people.

• Brian Niccol, Starbucks' CEO, said the company is considering a large expansion in the Middle East and China.
• The brand will open 500 new outlets in the Middle East in the next five years, he said.
• Starbucks' sales in the Middle East have taken a hit due to boycotts over the war in Gaza.

Brian Niccol, Starbucks' CEO, said the coffee chain is eyeing a major expansion into the Middle East and Chinese markets.

In a Friday interview with Bloomberg, Niccol said that the chain's franchise operator in the Middle East, the Alshaya Group, will open 500 new stores in the region over the next five years. He said the opening of the new stores is projected to create 5,000 new jobs.

Niccol also talked about a large-scale expansion in China. He said the company is focused on how to get bigger in China "because the reality is, that market is going to continue to grow for us."

"Today, we have over 7,000 stores. There will be many more thousands of stores in China in our future," he added.

Niccol's comments about building Starbucks' presence in these two markets come after the brand saw losses in the Middle East last year, where it faced boycotts linked to the war in Gaza.

Starbucks' finance chief said in an earnings call in April that comparable store sales outside the US fell 6% in the second quarter of 2024, largely because its Middle East business had taken a hit. Starbucks said on its website in 2023 that it had nearly 2,000 stores operated by the Alshaya Group in the Middle East and North Africa region.

"The boycott and that whole information cycle, it's really unfortunate," Niccol told Bloomberg.

"Because obviously, it hurts the brand, it hurts our partners in the stores, and the thing that's really disappointing about it is, it's just not based on anything that's accurate or true, you know, we've never supported any militaries," Niccol said.

The chain also faces an uphill battle in China.

The market has been flooded with offerings from budget local coffee chains like Luckin Coffee, Cotti Coffee, and KFC's coffee wing, KCOFFEE. These chains are now competing with Starbucks for buy-in from China's cost-conscious consumers.

Comparable store sales in Starbucks China decreased by 6% in the latest quarter, which ended on December 29.

Niccol's vision for Starbucks

Niccol, who took the top job at Starbucks in September, has been making big changes at the company.

In October, he said he aimed to rebrand Starbucks as an inviting place for people to hang out.

Niccol said on the company's January 28 earnings call that Starbucks would simplify its offerings. It would also work to reduce wait times by improving its mobile ordering process and testing a new algorithm for mobile orders.

On the earnings call, Niccol and Starbucks' finance chief said the chain would cut 30% of its menu items to streamline service.

Representatives for Starbucks didn't respond to a request for comment from Business Insider, sent outside regular business hours.

• Airbnb's CEO wants the company to become the Amazon of travel.
• Brian Chesky said the plan is for Airbnb to "be one place you go for all of your traveling and living needs."
• The company is investing $200 to $250 million to launch the new offerings on the app in May.

Brian Chesky, the CEO of Airbnb, says he wants the company to become a travel Amazon — a one-stop shop for everything related to traveling and living.

In a Thursday earnings call, Airbnb's chiefs said the company plans to invest $200 million to $250 million in launching new businesses and offerings on the Airbnb app. The latest offerings will be rolled out in May, Chesky said.

Chesky said the platform would "expand beyond short-term rentals into becoming an extensible platform with a range of new offerings."

"We want the Airbnb app, kind of similar to Amazon, to be one place you go for all of your traveling and living needs," he said. "A place to stay is just really, frankly, a very small part of the overall equation."

He likened Airbnb's new venture to Amazon, saying that the e-commerce giant started with books, expanded to the "nearest adjacency," which was DVDs and CDs, and "pretty soon they were doing things pretty far adjacent from media and books."

Chesky added that one of the company's goals is to get people to use the Airbnb app more often.

"We're not a very frequently used app. People typically use this once or twice a year, and I would love for it to be one day for people to use this once or twice a week," he said.

The company reported revenues of $2.48 billion in the fourth quarter of 2024, up 12% from the same period in 2023. Its annual 2024 revenue was $11.10 billion, up 12% from 2023.

Airbnb's stock price rose more than 14% in after-hours trading on Thursday.

Representatives for Airbnb did not respond to a request for comment from Business Insider, sent outside regular business hours.

• Canadian coffee chain Tim Hortons sold more cold drinks at the end of 2024 because of a warm winter.
• Tim Hortons saw an over 6% growth in its cold drinks sales in the fourth quarter of 2024.
• The country, known for its frigid temperatures, has been seeing milder winters of late.

Tim Hortons saw growth in its cold beverages division because of a warm end of the year in 2024.

The Canadian coffee chain's parent company, Restaurant Brands International, reported 2024 fourth-quarter and full-year earnings on Wednesday.

"Warmer than average Q4 temperatures contributed to over 6% growth in cold beverages," the company's CEO, Joshua Kobza, said of Tim Hortons' sales in Canada during a Wednesday earnings call.

"So we had a little bit warmer weather in the quarter and that tends to drive more cold beverage. And so we saw less good performance in some of our hot beverage," Kobza said, responding to an investor's question about the sales growth.

He added that Tim Horton's baked goods performance took a hit, too, as such products are usually purchased with hot beverages.

Tim Hortons Canada saw a 2.5% growth in comparable sales in the latest quarter. The chain has over 4,000 outlets in Canada, stores in the US and Europe, and a growing presence in Asia.

Restaurant Brands International, which also owns Burger King and Popeyes, reported comparable sales growth of 2.5% in its latest quarter, with total revenues of $2.30 billion.

Milder winters in Canada

Canada, known for its frigid temperatures, has seen milder winters in recent years due to the climate crisis and environmental factors like the El Niño effect.

The December to February winter period in 2023 and 2024 was the warmest winter the country has experienced since 1948, per the Government of Canada's Climate Trends and Variations Bulletin.

Environment and Climate Change Canada's news release in December said that "close to or above normal temperatures across the north and east" were expected in the winter of 2024 and 2025, and the western part of Canada can expect a "warm start to the season."

Representatives for Restaurant Brands International did not respond to a request for comment from Business Insider, sent outside regular business hours.

• Kering's CEO said he has no plans to shift production out of Europe to counter Trump's tariffs.
• He said that most of the group's production is in Italy and France, which is part of its heritage.
• Kering reported a 12% decline in annual sales in 2024, with its biggest brand, Gucci, sliding 21%.

Kering, owner of brands like Gucci, YSL, and Bottega Veneta, said that it has "no plan" to shift luxury goods production to the US to counter President Donald Trump's tariffs.

The group's CEO, François-Henri Pinault, said in a Tuesday earnings call that it "makes no sense" to move production out of Europe.

"Most of our brands we are producing in Italy and in France, and this is part of the promise that we bring through our products, through our heritage, to the consumer," he told investors.

"We are selling part of our culture, being an Italian culture or a French culture," he added. "So we have no plan of producing to counter the tariff. It makes no sense."

He said the group already operates in "big markets where we have import duties," such as China.

He added that the group might have to review its pricing strategy in light of the tariffs.

In January, Bernard Arnault, CEO of LVMH, floated the idea of relocating the group from France to the US to counter France's proposed tax hikes.

However, he backpedaled on his statement after receiving backlash, including from the leader of the French trade union.

Trump has announced a slew of tariffs, including a 10% tariff on all goods from China and a 25% levy on all steel and aluminum imports.

He has also threatened 25% tariffs on all goods from Canada and Mexico. And on February 2, he told reporters that tariffs will "definitely happen with the European Union," and that the trade actions of the EU were an "atrocity."

Kering reported weak annual financial results. Revenue was €17.2 billion, or $17.82 billion, in 2024, down 12% from the year before. Its recurring operating income decreased by 46% to €2.554 billion.

Its biggest brand by revenue, Gucci, saw its comparable sales slide 21% in 2024 compared to 2023. YSL, its second-largest brand, reported a 9% decrease in comparable sales.

The company's stock price has been down more than 40% in the past year. It remained largely flat after the company reported its annual results on Tuesday.

Representatives for Kering did not respond to a request for comment from Business Insider, sent outside regular business hours.

• McDonald's strategy with its $5 meal deals has been paying off.
• Chris Kempczinski, the company's CEO, said that the $5 deal is "driving other purchases," increasing average spending.
• The chain is doubling down on its McValue meals to attract a cost-conscious consumer base.

McDonald's bet on cheap meals is paying off.

In a Monday earnings call, McDonald's CEO, Chris Kempczinski, said that its $5 meal deals in the US were getting customers to spend more than just $5.

"If you look at the $5 meal deal, even though that's compelling value, it's driving other purchases," Kempczinski said to investors in the call.

He added, "So the average check on $5 meal deal for us in the US is north of $10. So it's doing what we were hoping for when we launched that."

The $5 meal deal includes a McChicken or McDouble burger, four pieces of chicken nuggets, a small soft drink, and a small serving of fries. The deal was only supposed to last for a month when it was introduced in June, but the chain announced in November that it would be making the deal a permanent fixture in its McValue menu.

Kempczinski said that other value meal options, like the "Buy one, Add one for $1" deals, which allow customers to buy one menu item for full price and the next for $1, have also been performing "very much in line" with their expectations.

The chiefs said in the call that the chain is also seeing good results for its value meals for international markets.

Ian Borden, McDonald's finance chief, talked about the Canadian McValue menu on the call — an offering that includes a $5.79 meal bundle and a $1 coffee. He said the coffee deal "drove coffee share gains in the quarter."

In Germany, it introduced an extended McSmart menu, which features deals like a double cheeseburger or double chicken burger, a drink, and medium fries for €4.99, or $5.14.

Borden said that in Germany, the chain "continued to drive market share gains by expanding upon the already successful McSmart menu now offering a range of meal bundle options introduced at the end of September."

He also added that the chain also introduced a similar GBP5 meal deal in the UK.

McDonald's saw a 0.4% increase in global same-store sales in the latest quarter, with its US same-store sales decreasing by 1.4%. The company posted a global fourth-quarter revenue of $6.39 billion.

The company's stock price had risen about 4.8% when markets closed on Monday.

Food and beverage chains have been betting on value deals to attract an increasingly cost-conscious consumer base around the world.

Pizza Hut in China saw sales of its pizzas under $7 rise 50% in 2024. Starbucks now offers free brewed coffee and tea refills to customers at participating stores.

This comes as Americans have been put off by the rising prices of fast food in recent years, with some opting to eat at home.

Representatives for McDonald's did not respond to a request for comment from Business Insider sent outside regular business hours.

• Dunkin' roasted Starbucks in its Super Bowl advertisement.
• The ad jabbed at Starbucks' long wait times and extensive customization options.
• Starbucks has recently discussed efforts to reduce wait times and simplify its menu.

Dunkin' used the biggest ad space of the year to jab at Starbucks.

The Super Bowl advertisement, which featured the actor-sibling duo Ben and Casey Affleck and the football coach Bill Belichick decked out in Dunkin' merch, depicted a competition among coffee brands.

Toward the end, the Affleck brothers and Belichick took turns roasting a group of baristas dressed in green jackets, which resembled Starbucks' signature green aprons and uniforms.

Though the trio did not explicitly mention Starbucks, they targeted some of the chain's widely publicized problems, such as long wait times and the extensive customization options that have contributed to them.

When one of the green-clad baristas addressed the Dunkin' team by saying, "About to get roasted! Like a dark seasonal roast with coriander and slight balsamic drizzle," Belichick replied, "Sounds like what's in my garbage disposal."

Ben Affleck then asked, "How much to wait a half hour to get my name spelled wrong on the cup?"

Casey Affleck piled on: "Nobody wants a goat milk double half-caff soy milk capp. You could just brew it — it's beans and water."

Representatives for Dunkin' and Starbucks did not respond to requests for comment sent outside regular business hours.

In an extended six-minute version of the ad, they also targeted McDonald's, where coffee and breakfast are an increasingly important part of the menu.

Starbucks' new CEO, Brian Niccol, has been working to simplify the chain's offerings and reduce wait times by streamlining its mobile ordering system, including by testing a new algorithm for mobile orders.

On the company's January 28 earnings call, Niccol and Starbucks' finance chief said the chain would also cut 30% of its menu items in a bid to streamline service.

A Starbucks representative confirmed to BI on Wednesday that the chain planned to lower the cap on the number of drinks customers could buy in one mobile order to 12 from 15 and remove some customization options for its mobile orders.

Niccol, who said mobile orderings had "chipped away" at the company's "soul," is trying to make Starbucks a cozy coffeehouse where customers can hang out. Dunkin', meanwhile, has long been known as a cheaper to-go coffee shop with little comfortable seating.

• Pizza Hut is attracting cash-strapped Chinese consumers with lower-cost offerings.
• Its parent company, Yum China, reported on Thursday that sales of pizzas under $7 rose 50% in 2024.
• The brand also launched a budget arm in China in 2024 called Pizza Hut Wow.

Pizza Hut in China is winning big by selling cheap pizzas.

The chain is leveraging weakened consumer confidence and expanding its lower-priced offerings to attract cost-conscious Chinese consumers.

Parent company Yum China, which also owns the country's KFC operations, reported that Pizza Hut saw a 3% year-on-year sales growth in its latest quarter.

The earnings report also said that Pizza Hut saw its operating profit increase by 156% in the quarter compared to the year before.

Yum China's chiefs said in the Thursday earnings call that the company has taken several steps to lower customers' prices.

"We're transforming Pizza Hut into a more mass-market brand by widening price range and enriching the menu," Yum China's finance chief, Adrian Ding, said in the call.

Ding said that sales of its cheap pizzas, priced under RMB50 — slightly less than $7 — increased 50% in 2024 compared to the year before.

Pizza Hut had also lowered the price of "about 30 iconic products," starting from "RMB9.9 for the drinks and dessert," Yum China's CEO, Joey Wat, said to investors. RMB9.9 is roughly equal to $1.40.

The chain also expanded its budget wing — Pizza Hut Wow. The Wow stores offer smaller, cheaper versions of Pizza Hut's regular fare. Wat said that despite the lower average ticket spend at these stores, they attract younger customers and expand Pizza Hut's market.

Pizza Hut opened 412 new stores in 2024, bringing the total to 3,724. Wow stores, which were introduced in May 2024 and mostly converted from older Pizza Hut stores, exceeded 200 by the end of 2024.

"Pizza Hut has made significant progress in transforming itself to become more affordable for customers and more profitable for the company," Ding said to investors in the call.

The chain has been successful in China, seeing positive transaction growth for eight consecutive quarters. Its success is partly attributed to the introduction of products that appeal to local tastes, such as its wildly popular durian pizza in 2024.

Yum China reported a total annual revenue of $11.3 billion in 2024, a 3% increase from the year before. Its stock price rose about 9% in after-hours trading on early Friday.

Representatives of Yum China did not respond to a request for comment from Business Insider.

• ELF Beauty said it saw weak demand in January because of the LA wildfires and uncertainty over TikTok.
• ELF's CEO, Tarang Amin, said that social conversations around beauty dropped because of these factors.
• The brand suffered a 36% drop in profits in its latest quarter and lowered its 2025 outlook.

Budget beauty brand ELF Beauty said demand for the beauty industry was weaker in January because of uncertainty over the banning of TikTok.

The company's latest quarter, which ended on December 31, saw a 36% year-on-year profit drop. The company lowered its fiscal outlook for 2025 because of "softer than expected trends in January," according to the earnings report.

ELF's CEO, Tarang Amin, said in a Thursday earnings call that January was a "weak month" for the brand. He said that the banning of TikTok and the devastating LA wildfires led to a drop in conversations about beauty on social media in January.

"First, the category continued to decline in January. We believe this decline is reflective of consumers stocking up in a highly promotional December and lower social conversation around beauty," Amin said. "Consumer mindshare was focused elsewhere, including wildfires in LA and uncertainty around the TikTok platform."

He added that brands did not want to be "tone-deaf" during the wildfires. And regarding TikTok, he said that "the only thing people were posting on TikTok was whether it was going to stay open or shut down."

TikTok, a social media platform by Chinese company ByteDance, faces an imminent banning in the US as the Supreme Court has imposed a divest-or-ban law on it.

It was originally supposed to be banned on January 19, but President Donald Trump signed an executive order on the day of his inauguration to delay the ban by 75 days.

TikTok Shop, which is the app's e-commerce feature, was the ninth-biggest online retailer for the beauty industry in the US as of February 2024, according to a report by software company Dash Hudson and Chicago-based market research company NielsenIQ.

ELF reported a 31% increase in sales in the latest quarter compared to the same quarter a year ago. It earned revenues of $355 million.

However, higher sales and tax costs reduced its net income, according to its consolidated statements.

ELF's stock price dropped more than 24% in after-hours trading on Thursday.

Representatives for ELF Beauty did not respond to a request for comment from Business Insider, sent outside regular business hours.

• Capri Holdings, the parent company of brands Versace, Jimmy Choo, and Michael Kors, reported earnings on Wednesday.
• Versace saw its sales slide 15% in the latest quarter, and Capri said it was because of two factors.
• It said Versace leaned too hard into the quiet luxury trend and reduced its lower-priced offerings.

The CEO of Versace's parent company says the brand made two mistakes that caused its sales to slip.

Capri Holdings, owner of Versace, Jimmy Choo, and Michael Kors, reported a 15% dip in Versace's revenue compared to the previous year. The Italian luxury brand earned $193 million in the quarter that ended on December 28.

Its sales dropped 21% in the Americas and 11% in Asia, according to the earnings report on Wednesday.

In the company earnings call on Wednesday, Capri CEO John Idol said that two things went wrong with Versace — leaning too hard into the quiet luxury trend and reducing the number of its lower-priced offerings.

Idol said that in the fall of 2023, Capri began to reposition Versace by placing a "greater emphasis on luxury and craftsmanship, which was more in line with the quiet luxury trend."

He said to investors that Versace's "VIC," or very important customers, responded positively to the switch to more sophisticated products. But "while elevating the assortment, we believed we removed too many unique Versace statement items," Idol said.

Reducing the number of entry-level priced goods also meant sales took a hit, he said.

Idol said that Capri reduced end-of-season markdowns in Versace stores as part of its overall brand elevation strategy, which had a "near-term impact on Versace's revenue."

"Additionally, we significantly reduced our offerings of products at entry-level luxury price points," he said, adding that it impacted retail sales as well.

To rectify these issues, Idol said that in the next fiscal year, Versace would try to "achieve the ideal balance of fun and elegant assortment" and introduce "a wider offering of product to appeal to a broader base of luxury consumers."

He said that expanding the product offering will help the brand re-engage with its aspirational customers.

Quiet luxury is on the way out

The quiet luxury trend, characterized by subtle pieces and logo-less designs, may have hurt the luxury industry, Bank of America analysts said in a January note.

The analysts wrote that the trend fueled the rise of dupes, which resulted in a weaker demand for luxury products.

Kering, the owner of Gucci, YSL, and Balenciaga, saw its stock fall more than 40% in 2024. And luxury giant LVMH saw its sales slide 3% in the third quarter of 2024, partially due to weakened consumer confidence in China.

The BofA analysts suggested that the luxury industry should "pivot back to creativity, fashion content, and newness" instead of pursuing simplicity.

"In order to reestablish stronger barriers to entry, we think the logo and fashion content is important," the analysts added in the note.

Representatives for Capri did not respond to a request for comment from Business Insider, sent outside regular business hours.

• Starbucks CEO Brian Niccol said mobile ordering "chipped away" at the brand's soul.
• In a Rapid Response interview, he said mobile ordering caused the brand to lose touch with its customers.
• Since he took on the top job in September, he has worked to make stores more inviting.

Brian Niccol, Starbucks' CEO, said that mobile ordering "chipped away" at the brand's soul.

In a Tuesday podcast interview with Rapid Response's Bob Safian, Niccol said, "I think one of the things that veered Starbucks a little bit off was the whole mobile ordering, the COVID situation."

Niccol added that he thought mobile orders affected the "connection" Starbucks has with customers because staff just used labels, and "stopped writing on the cups."

He said that the company also focused on how to "remove seconds from the proposition" instead of maintaining the "experience and the connection" for customers.

He said that, at the moment, Starbucks outlets have no control over how many mobile orders they receive, and this puts pressure on the baristas to "just get drinks out the door" instead of connecting with customers.

Niccol added that, on average, mobile-ordered drinks sit on the counter for six to eight minutes, so the customer doesn't end up with the best product.

"It's been sitting there, and then usually what happens is you ask our barista to remake it," he said.

In an earnings call on January 28, Niccol introduced a new algorithm for mobile orders in an effort to make mobile ordering a lot smoother.

Since the CEO moved from Chipotle for the top job in September, he's tried to make Starbucks coffeeshops more inviting.

That involves changes like having more comfortable chairs in the cafés and serving customers their coffee in ceramic mugs again.

In an internal memo obtained by Business Insider on January 27, the chain directed staff to start writing messages to customers on single-use coffee cups to add a more personalized touch.

On the January 28 earnings call, Niccol and Starbucks' finance chief said the chain would also reduce the number of items on the menu and add digital menu boards to stores.

Representatives of Starbucks did not respond to a request for comment from Business Insider sent outside regular business hours.

• Pfizer's CEO Albert Bourla said that he's had dinner with Trump's health secretary pick, RFK Jr.
• Bourla said he was "cautiously optimistic" about the new administration.
• Kennedy is now close to securing the health secretary position, pending a Senate vote.

Pfizer's CEO said that he had dinner with President Donald Trump's pick for health secretary, Robert F. Kennedy Jr.

In a Tuesday earnings call, CEO Albert Bourla said Trump had introduced him to Kennedy, a longtime vaccine critic, and the duo ended up having dinner together.

Bourla did not specify when he met with Kennedy, but said they'd talked about topics they could agree on and "not on the things that we clearly disagree, like the vaccines."

"And those are things in chronic diseases, in cardiovascular diseases, and more importantly, in cancer, which is something that is very, very high in the mind of the president. And it is also very in the mind of Mr. Kennedy," Bourla told investors.

Bourla added that he was "cautiously optimistic" about the new administration.

"I think there are a lot of opportunities that probably outweigh the risks that we have with the radical change that we will see from the Trump administration," he said.

Bourla said that he thinks the administration would not like to see "another health crisis," and is optimistic that "they will be very, very prudent with everything they try to do."

Pfizer, one of the world's biggest pharmaceutical companies, produces medicines and vaccines.

Kennedy, a former environmental justice lawyer, ran for president himself before dropping out of the race in August. He then aligned himself closely with Trump, who, after the elections, tapped him to lead the Department of Health and Human Services.

Kennedy has also established a new MAHA — Make America Healthy Again — movement, which has called to remove vaccine mandates and lobby against fluoride in the water system.

Kennedy's tough stance on vaccines

Kennedy has taken a tough personal stance on vaccines.

In 2023, Kennedy vowed to slash funding for federal health agencies that regulate childhood vaccines if elected president.

And in May 2021, he was one of two people who jointly petitioned the Food and Drugs Administration, urging it to "immediately revoke" emergency use authorizations that allowed children under 16 to take the Pfizer and other COVID vaccines.

But shortly after Trump's November win, Kennedy told NBC that he would not "take away anybody's vaccines," but would let them choose if they wanted to be vaccinated.

On Tuesday, he moved closer to becoming health secretary after winning the crucial support of Louisiana Sen. Bill Cassidy, a former physician.

Kennedy's nomination cleared a key hurdle and passed the Senate Finance Committee, who voted along party lines to move it forward. His nomination is now slated for a full Senate vote.

Representatives for Kennedy and Pfizer did not respond to requests for comment from Business Insider, sent outside regular business hours.

• The US Postal Service said it will stop accepting parcels from China and Hong Kong immediately.
• Only parcels are affected as the temporary restriction doesn't apply to letters and flat mail.
• A logistics expert predicted "chaos" in the short term with disruption and cancellations.

The US Postal Service said it is temporarily suspending inbound parcels from China and Hong Kong, in a potential blow to Chinese e-commerce retailers.

In a statement on its website Tuesday evening, the USPS said the suspension would take effect immediately and be in place "until further notice." It does not apply to letters and flat mail.

The suspension comes after President Donald Trump imposed a new 10% tariff on all goods imported from China and ended the de minimis exemption that allowed packages worth less than $800, bound for individual consumers, to avoid tariffs.

Louise Loo, the lead economist for Greater China at Oxford Economics, wrote in a note on Tuesday that the exemption had been "particularly relevant" for Chinese e-commerce retailers — such as Shein and Temu — and that China and Hong Kong accounted for 67% of packages entering the US under the exemption between 2018 and 2021.

PDD, Temu's parent company, was down 6% in premarket trading on the Nasdaq after the USPS announcement.

There were more than 1.36 billion de minimis shipments into the US in the 2024 fiscal year according to the US Customs and Border Protection.

The agency said in a January statement that shipments into the US under the exemption had risen by more than 600% over the past decade.

"This exponential increase has created challenges for CBP's effective enforcement of US trade laws, health and safety requirements, intellectual property rights, and consumer protection rules," the statement added.

'The next couple of days are going to be chaotic'

US consumers can expect chaos with their packages, a trade specialist told Business Insider.

"There'll be disruption, there'll be cancellations, the next couple of days are going to be chaotic," said Ram Ben Tzion, the CEO of Ultra Information Solutions.

Chinese exporters could choose to use companies such as DHL, UPS, and FedEx — but this demand surge could cause freight costs to increase, said Ben Tzion. His company is behind Publican, a digital vetting platform for global trade.

Private freight companies may also start evaluating how they plan to handle inbound packages from China and Hong Kong.

"The suspension is actually sending a very strong message to FedEx, to UPS, to DHL that they also need to consider if they continue taking packages from China," Ben Tzion said.

He advised consumers to wait before carting out any products that are shipped out of China or Hong Kong.

"If you continue buying on Shein, Temu, Alibaba, or Amazon, I strongly suggest that you wait for the next week to see how it plays out, because it's going to be a mess," said Ben Tzion.

USPS declined to elaborate on its statement when contacted by BI.

• President Donald Trump on Monday signed an executive order to start a US sovereign wealth fund.
• He said that the fund could be used to buy TikTok, which is facing a looming ban in the US.
• He has floated numerous other ways to save the app, like having Elon Musk or Larry Ellison buy it.

President Donald Trump floated the idea of buying TikTok with an American sovereign wealth fund, which he signed an executive order on Monday to create.

"So other countries have sovereign wealth funds, and they're much smaller countries, and they're not the United States. We have tremendous potential in this country," Trump told reporters at the White House on Monday.

Sovereign wealth funds pool money that comes from the government, often a surplus from economic activities like producing oil. Some funds invest in stocks and bonds, while others invest directly, buying real estate, companies, and other assets. Norway has the world's biggest sovereign wealth fund, with $1.7 trillion in assets.

"And as an example, TikTok, we're going to be doing something, perhaps, with TikTok, and perhaps not," he said. "If we make the right deal, we'll do it; otherwise, we won't."

"But I have the right to do that and we might put that in the sovereign wealth fund, whatever we make, or if we do a partnership with very wealthy people," Trump added.

Treasury Secretary Scott Bessent said that the fund would be set up within the next 12 months.

Time's running short for TikTok

TikTok has until April to devise a game plan as it fights against the Supreme Court's divest-or-ban law. It went dark for its 170 million US users on January 18, a day before its original deadline, but was restored hours later.

Shortly after his inauguration on January 20, Trump signed an executive order to delay the ban by 75 days. He then suggested that the US should own half of TikTok.

"I think we would have a joint venture with the people from TikTok. We'll see what happens," Trump said after taking office.

A day later, he said he would be on board with Tesla CEO Elon Musk or Oracle cofounder Larry Ellison buying TikTok.

Neither businessman has publicly expressed interest in buying the app. But Musk said in an X post on January 19, the day of the intended ban, that he has been against the ban "for a long time" because it "goes against freedom of speech."

Representatives for Trump and TikTok did not respond to requests for comment from Business Insider.

• President Donald Trump has said he wants Ukraine to "do a deal" with the US.
• Trump said he wanted Kyiv to supply Ukraine's rare earth metals to the US in exchange for aid.
• Rare earth metals are used in products as varied as electric vehicles and fighter jets.

President Donald Trump said he wants Ukraine to give the US rare earth metals in exchange for aid in its war with Russia.

Speaking to reporters at the White House on Monday, the president said he wanted to get guarantees on a supply of "very valuable rare earth" materials from Ukraine in return for US military equipment.

"We're looking to do a deal with Ukraine where they're going to secure what we're giving them with their rare earth and other things," Trump said.

Trump added that he was "working some deals right now."

According to the State Department, the US has provided $65.9 billion in military assistance to Ukraine since Russia's full-scale invasion on February 24, 2022.

It's unclear what specifically what Trump was referring to. The term "rare earths" is generally used to describe 17 metallic elements that are relatively common but difficult to gather in large quantities. They are used in products as varied as smartphones, electric car motors, and F-35 stealth fighters, though they do not include better-known elements, such as lithium and uranium, that the US also considers critical for economic and national security.

US stockpile levels of rare earth materials haven't been made public. Experts told BI in June that they estimated US stockpile levels were far below what they would need to be if a war were to break out.

Gregory Wischer, a mineral consultant at Dei Gratia Minerals, said at the time that the Department of Defense's consumption rate of rare earth minerals was also unclear.

China holds an edge over the US in its supply of rare earth materials; in 2023, the International Energy Agency reported that the country was producing 60% of the world's supply and refining 90% of it.

Trump's comments on rare earth metals came as he issued and then retracted a series of tariff orders. The Trump administration said Saturday it had imposed a 25% tariff on goods from Canada and Mexico and a 10% tariff on China.

But Trump delayed tariffs on Mexico and Canada for 30 days after both countries agreed to meet some of his demands on border issues.

Representatives for Trump and Ukraine's foreign ministry didn't respond to requests for comment sent outside regular working hours.

Correction: February 4, 2025 — An earlier version of this story mischaracterized three elements. The US considers lithium, uranium, and tantalum to be critical minerals, but they are not among the 17 elements generally described as rare earth metals.

• Shein, which was banned from India in 2020, has regained access to the populous market.
• The Chinese fast fashion brand has entered an agreement with Mukesh Ambani's Reliance Industries.
• It will sell products under a new e-commerce platform called Shein India Fast Fashion.

Shein is re-entering the world's biggest consumer market, India, nearly five years after it was banned there in 2020.

India's Ministry of Information Technology banned Shein and dozens of other Chinese apps including TikTok in 2020, citing concerns over national security and data privacy.

But Reliance Industries, a multinational conglomerate owned by India's richest man, Mukesh Ambani, is bringing Shein back into the country under a new platform called Shein India Fast Fashion.

Business Insider's checks showed that a new Shein app was available on Apple and Google's app stores as of January 27. The app listing showed it was operated by Reliance Retail, Reliance Industries' consumer arm.

"The fashion OG is back!" a pop-up message on the app wrote.

According to a memo on the app seen by Business Insider, the brand currently ships products only to select regions, such as Delhi NCR, Mumbai, and Bangalore, India's tech hub.

"Pan-India shipping very soon," the notice said.

When BI searched the App Store in India for the original Shein app, a notice said it was not available.

The Reliance and Shein agreement was brought up in a parliament address in December when India's commerce minister, Piyush Goyal, said the two companies had entered into a technology agreement to develop an e-commerce platform.

"The platform is intended to create a network of local manufacturers and suppliers who will manufacture products under the brand of Shein and sell them domestically and globally," Goyal said.

Shein faces an uphill battle in the US, its largest market

Re-entry into India, the world's most populous country with nearly 1.43 billion people, comes at a crucial time for Shein as it faces a reckoning in the US. The US is its largest consumer market, according to GlobalData estimates seen by Reuters.

But President Donald Trump imposed a 10% tariff on goods from China on Saturday, along with a 25% tariff on goods from Canada and Mexico. During his 2024 campaign, Trump said he planned to impose tariffs of 60% or higher taxes on Chinese products.

Jeffrey Towson, the founder of US and China-based retail consultancy TechMoat Consulting, told BI in November that Shein and Temu, another budget Chinese retailer, won't be able to escape the consequences of the tariffs.

"Shein and Temu excel at very low prices. That's why American consumers love them. But there is nothing left to squeeze out of their China supply chains," Towson told BI.

He said that consumers are likely to see price increases due to the tariffs unless "the supply chains are redirected," which he said was "very likely."

Representatives for Shein and Reliance Industries did not respond to requests for comment from Business Insider.