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Good morning.
A couple of stories on companies thriving during the pandemic for your consideration.
First, Clorox. COVID has been good to the company, as consumers scrambled for its disinfectant products. The famed wipes get snatched off shelves as quickly as they are put down, and I haven’t been able to find a bottle of my wife’s favorite Clorox/Tilex spray in six months. Sales in the quarter ended June 30 rose 22% from the previous year, and annual revenue hit $6.7 billion, up 8%. The company’s share price is up 42% since the first of the year. And the pollsters at Morning Consult put it at number six on their “Most Loved Brands” list, right after Netflix and before Amazon Prime.
How do you turn that pandemic-powered popularity into a perpetually better business? That’s the challenge that faces new CEO Linda Rendle. Fortune’s Phil Wahba does a deep dive into her challenge, available this morning here.
And second, Keurig Dr. Pepper. As the hot and cold drink businesses converge, this upstart is giving Coke and Pepsi a run for their money. In the 20-week period ended July 21, KDP grabbed 34.1% of the $1.4 billion increase in revenue for carbonated beverages, making it best-in-class at navigating the pandemic. And its ubiquitous coffee pods went through the roof. (We used more than a half dozen a day at my house while sheltering in place.)
KDP CEO Bob Gamgort told Fortune’s Shawn Tully that he hopes to thrive by embracing—rather than dreading—uncertainty. “Our rivals are rolling over and hoping the status quo returns,” he said. “It’s not returning.” You can read Tully’s piece here.
More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
European lockdowns
Ireland and the Czech Republic have become the first—and probably not the last—European countries to go back into national lockdown. The Irish government is being open about the fact that 150,000 people will likely lose their jobs as a result. The pandemic's second wave is hitting Europe hard, with 20 countries reporting record case numbers yesterday. Fortune
Asian outlook
The International Monetary Fund had been expecting Asia's pandemic-related economic contraction this year to be around 1.6%, but now it's updated that figure to a likely 2.2%. The IMF notes particularly sharp contractions in India, the Philippines and Malaysia—its forecast holds that India's economy will be decimated in the year ending March 31, 2021, with a contraction of 10.3%. CNBC
Airlines retreat
The IAG-owned airlines BA, Iberia and Vueling were going to run 40% of last year's schedule in the last quarter of this year, but the second wave of the pandemic hit bookings hard, so the carriers will now fly just 30% of last year's schedule in the quarter. IAG has also revealed losses of over €1 billion ($1.2 billion) last quarter. Financial Times
PayPal crypto
Big news in the cryptocurrency world: PayPal, one of the biggest beasts, will soon support virtual currencies such as Bitcoin, Ether and Litecoin. As Fortune's David Z. Morris explains: "PayPal’s cryptocurrency service, at least at first, will be effectively limited to purchasing currencies through a third party, Paxos Crypto Brokerage, which will actually hold the private cryptographic keys controlling the crypto tokens." Fortune
AROUND THE WATER COOLER
Farewell Quibi
We hardly knew you. "Our failure was not for lack of trying," said founder Jeffrey Katzenberg and CEO Meg Whitman to the smartphone-focused streaming service's unlucky employees and investors, as they announced its closure, a mere six months after launching. The duo decided to pull the plug now, so as to give investors as much of their capital back as possible, rather than dragging out the inevitable. Wall Street Journal
Deliberate infection
The U.K. is allowing a controversial COVID-19 vaccine trial to go ahead, where healthy young volunteers will be deliberately infected with the coronavirus. Many bioethicists have strong reservations about conducting these "challenge trials", though, especially where the relevant disease has no proven cure. In this case, the researchers say they will use Gilead's remdesivir as the "rescue drug"—but remdesivir does not have any significant impact on COVID-19 mortality. Fortune
Buckle up
If you're enjoying the market gyrations that are accompanying the deeply uncertain U.S. stimulus talks, you're going to love what comes next. As Fortune's Anne Sraders writes: "Market observers and strategists have been counseling clients on what a contested election might do to equities, and many dread what kind of volatility we’d see in the event of a dragged-out election decision. Some investors are also planning ahead, buying options and futures on a bet things will be volatile after Nov. 3." Fortune
Moon announcement
NASA has some exciting news to share about the Moon. It will announce "an exciting new discovery" on Monday, and whatever it is, it's something that "contributes to NASA’s efforts to learn about the Moon in support of deep space exploration." While on the subject of NASA, the agency has released some sweet footage of its OSIRIS-Rex spacecraft tagging the surface of asteroid Bennu, and it's also awarded the contract for lunar 4G (yes, really) to Finland's Nokia. Independent
This edition of CEO Daily was edited by David Meyer.
