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Fourteen years ago, Silicon Valley startup August rethought the front door with its internet-connected smart locks. Its growth led to an acquisition in 2017 by lock manufacturer Yaleand it’s still the top-selling smart lock brand in the U.S. But despite the relative ubiquity of connected-home products like August‘s locks, Ring doorbells, and Nest thermostats, the true ideal of the smart homea dwelling with built-in tech that seems to magically cater to your needsseems no closer than it was when August launched. Now, Augusts founding team is back for a second attempt at realizing the smart home with Doma. The new startup is led by August founders Jason Johnson and designer Yves Béhar, and its even raised an undisclosed sum from original August investors Moderne Ventures and Uncork Capital in a recent seed round. On paper, Doma doesnt need to exist. The smart home market is growing with or without it. But that hardly means there isnt opportunity for disruption in a category that doesnt seem to be making anyone all that happy. For most people, the home is their single greatest investment, but its no more resilient to floods or able to cater to our moods than it was a generation ago. Béhar and Johnson think they can address at least one of those. These single-entity products that have launched a part of an era that we think is going to go awayand we want to be the pioneers of of this new wave of solutions,” says Béhar, who notes that the Doma team prefers to work toward home intelligence” rather than a “smart home.” [Image: Muse Storytelling] The false promise of a smart home The smart home is one of those ideas thats seemed inevitable on the early-aughts stages of amped tech conferences, but simply didnt scale practically for most people. iPod guru Tony Fadell rethought thermostats with his Wi-Fi enabled Nest in 2011, while August arrived in 2012 to usher in keyless electric locks that opened via smartphone. In the decade-plus since, weve gotten internet-connected security cameras, doorbells, lighting, TVs, and music players. Altogether, the smart home industry is projected to bring in global revenue at $160 billion in 2025 and growing 12% a yearbut its premise is a lie. We have smart appliances that each live a discrete digital life. Even despite unifying smart home standards like Matter, and organizing app layers like Apples HomeKit and Googles Google Home, none of it sings as some future-home UX weve been promised. We still need to manage everythingoften in separate apps. Every time I change the music or the lights, I have to get on my phone, says Béhar. I would say [we want to create] very quiet experiences that really equate to something magical, something luxurious. In many ways, a real smart home feels as far away today as it did a decade ago. One recent survey of 1,000 people found that as many as 93% of U.S. households now had a smart home device of some sort, but less than a third intended to buy any more smart home devices over the next year. We always dreamed of going deeper into the home with August, Johnson says. Now, he wants Doma to be a super team of traditional home product manufacturers, unified by discreet sensors and design standards driven by Béhars firm Fuseproject, to create a more natural experience driven less by apps on your watch or phone than a smart AI system that tracks your familys behaviors in a home. We don’t want the technology to be what it is today. You go to somebody’s front door, there is a camera, there is a door lock, there is a keypad, says Béhar. Those things are parasites that have been kind of tacked, glued, or taped to the outside of your home, and then inside your home, the issue is exactly the same. [Image: Muse Storytelling] How Doma wants to buck the industry Exactly how Doma creates these experiences, and what theyll entail, is still very much up in the air. At the heart of Domas system is an AI that promises to choreograph experiences as simple as predicting the room youre entering next and turning the lights on for you. It will integrate with platforms like HomeKit, and use emerging sensor technologies, like sub-millimeter wave detection, to follow someones behaviorsin, out, and around the house. Used by Googles Project Soli, sub-millimeter wave technology is basically radar. But Johnson notes that in a home setting it can be tucked behind glass so it doesnt stick out from a surface like a security camera. And it can track movement data without more obtrusive video feeds that eliminate a sense of privacy. The first Doma products will be announced later this year, and the company is considering sensors around movement, air, water, and energywith a particular focus on home security at launch Alarms remain particularly annoying, and Johnson points out that opening a window for some fresh air in the middle of the night can bring the police to your door. But an AI that could tell it was you who’d opened the window could ignore the gesture. At minimum, it might try a more subtle tack, like turning on a light to get your attention, before calling the police. One of the things that we really want to do with August is to truly secure a home. And we couldn’t do that, right? saysJohnson. We could lock the door if it was closed. We couldn’t close the door. We couldn’t lock windows. So will Doma allow those new interactions? That may be the plan with the help of Domas product partnerswhich currently include half a dozen more traditional companies around the home who are building Doma-ready products. (The company makes money off of product sales.) While the team is still tight-lipped about whats actually in the works, they are promising a few unifying brand standards, to ensure premium integration. For one, Doma products wont have batteries. Everything will be hardwired (a decision that addresses an ongoing issue but seems rooted in the scar tissue of early August years, when dead batteries were a regular headache for users). Nothing can require a subscription. Another key tenet: Whenever Doma sunsets a product, it must still keep all of its basic function (even if some AI would be lost). Johnson says of the Google/Nest announcement that its older generation projects would lose their networking properties, the Doma team felt affirmed in their adherence to the idea that if we were to cease to exist as a company . . . you could still use all of our products without requiring access to the API or to the cloud.” All-in-all, much of Domas logic is sound. Assuming they can woo the right partners, and actually create a more meaningful home UX with artificial intelligence, the only real catch is that Doma, by design, wont be for everyone. The deep integration of its hardwired hardware comes with a cost: it will require either skilled handymen or patient homeowners to install it. This naturally limits a market of smart home buyers who might snag a Nest or tack-on doorbell. Doma is really meant for people doing a retrofit or new construction. But the result of all of this investment is that Doma wants to be the first company to really do the intelligent home the right way and demonstrate whats possible. Were architecting everything to beand we dont have the right term yetbut to be persistent, says Johnson.
Category:
E-Commerce
Its one of the great questions of our modern age: How does Sweetgreen lose money selling $14 (and up!) fast casual salads and bowls? And not just a little money but $442 million in the last three and a half years and more than $908 million since 2014. Sweetgreen is having a disastrous 2025, with same-store sales down 7.6% in the second quarter after a Q1 drop of 3.1%, and a now aborted rollout of fries (how do you mess up fries?). The stock is down more than 70% this year. No one has ever grown a salad chain to Sweetgreens size, 260-plus restaurants and 2025 revenue tracking to more than $700 million. But if the company is to achieve its lofty goals, 1,000 locations mainstreaming its healthy and sustainable ethos, its foundersCEO Jonathan Neman, chief concept officer Nicolas Jammet, and chief brand officer Nathaniel Runeed to step aside. Let me tell you why. What the fries debacle reveals about Sweetgreens problems How the founderss obsession with tech ignores the secret that’s underpinned popular chains both customers and investors have loved Why the Sweetgreen founders can’t be fired Sweetgreen did not respond to a request for comment by press time. We’ll update this piece if the company responds. Fry Guys A salad with a side of fries is such an American cultural cliché that theres even a podcastthat adopted the phrase for its title. So in March 2025 when Sweetgreen added Ripple Fries to its menu nationwide, the move made perfect sense.”This is a way to show that you can come to Sweetgreen, eat a salad, and have a little bit of a permissible indulgence around fries,” CEO Neman told Fast Company in a piece timed to the rollout. Sweetgreens fries, a year in the making, came with the healthy halo of being air fried in avocado oil.”Its the first time we have a truly signature side,” Neman said. The other sides were fine, but now we have this staple. And theyre really addictive. Neman was excited to tell investors in May during its first quarter earnings report that the fries were a hit.Ripple Fries drove same-store sales improvement in March. They have become our most attached side item across channels, helping to lift overall ticket averages and broaden the meal experience. Notably, the strength has been consistent across all markets. But just three months later, in a shocking turn, that indulgence had become problematic, and Sweetgreen was going cold turkey. Neman broke the news he was dropping fries in an odd oh, by the way comment during the companys disastrous second quarter earnings call: If I could just mention one other thing, you know, no one’s asked about Ripple Fries, but I do think it’s important to bring it up. You know, Ripple Fries is something that we’ve learned consumers love. We had a great reaction from. But as we studied what it was doing to the restaurant operation and the distraction for our teams, we realized that it became a complexifier for us delivering on our core. So one of the other big changes we’ve made is starting next week, we will be discontinuing Ripple Fries in order to focus on our core. And in stores where we have tested this, we’ve seen huge improvements in customer satisfaction, because, again, teams can really focus on the core products. What the hell happened between May and August? What likely killed Sweetgreen’s fries Actually, the right questions to ask are what didnt happen before the March debut of fries? And why? That we even have to ask these questions is what leads me to believe Sweetgreen needs new leadership. The company appears not to have done enough testing of how Ripple Fries would affect restaurant operations. Company execs told Fast Company in March that theyd spent months testing the fries at some of its L.A.-area stores. But the best practices for testing a new product are to start with one high-performing store, move to a district-wide test that encompasses stores of varying quality, and then do a strict experiment to assess the economic impact of adding fries in a sufficient number of stores and for a meaningful amount of time so that theres virtually no doubt the new menu item will have the desired impact. Then you develop a rollout plan and train employees to make sure that you see the successful results of your experiment when you go national. In hindsight, a comment Neman made to Fast Company in March raises an eyebrow today. We know that people will attach it to their meal. The question is, will people come in more because of it? Will it drive actual core transactions for us, or will it just drive ticket? If he and the company truly didnt know the answers to these questions, then they didnt do enough testing and werent ready to rollout Ripple Fries. Sources familiar with Sweetgreen’s operations laud management’s innovation and willingness to try something bold, and they laud Neman’s decisiveness in killing Ripple Fries because of the impact it was having on the frontline restaurant staff’s ability to deliver salad and proteins consistently. In sum, they assert that Neman and senior leadership did everything right. Okey-doke! They also are quick to cite broader economic conditions that have inspired many Americans to eat out less or trade down for more value. Online, the disappointing earnings of Cava, Chipotle, and Sweetgreen inspired a “slopcession” discourse in the last week, lampooning the cooling societal ardor for eating all our meals out of a bowl piled with stuff. If fries were an isolated incident, or if all of Sweetgreen’s woes could be explained by fragile consumer confidence, perhaps I, too, could buy these narratives. But there are signs everywhere that Sweetgreen is struggling with its operations. Sweetgreen is not a good operator The most successful restaurant chains in history, fromWhite Castle to In-N-Out Burger to McDonalds to Chipotle, introduced innovative systems. High-performing chains need a good product, sure, but they rely on processes to get peole their food as quickly as possible and able to handle rush times. Sweetgreen’s leadership understands this and yet achieving it remains elusive. Look at what Neman had to say in May and then what he said in August. Heres the CEO in May: True operational excellence requires relentless attention to detail, especially now. That’s why our team is committed to optimizing every process, no matter how small, to drive continuous improvement. Now heres Neman in August: Today, about one-third of our restaurants are consistently operating at or above standard, while the remaining two-thirds represent a meaningful opportunity for improvement. Ouch! How are two-thirds of Sweetgreens restaurants below standard? One answer may be that the companys chief operating officer role has been a great source of instability. Since 2018, six people have rotated through the position. Sources familiar with Sweetgreen operations have high hopes for the latest COO, Jason Cochran, who is a former Chipotle VP of operations services, who was hired this spring. They also reaffirm the company’s high standards. But at present, Neman and company seem to do things that run counter to his statement about relentless attention to detail. Sweetgreen is on its third loyalty program in four years. After introducing its current one, SG Rewards, in April to replace its SweetPass subscription loyalty membership, Neman had to acknowledge that Sweetgreen faced a falloff in revenue from a small but highly important cohort of former SweetPass members following the discontinuation of the subscription program. Translation: It didnt anticipate that it should do whatever it could to take care of its best customers before revamping its loyalty program. Almost as bad, Neman revealed to investors that later this year the company would be adding the ability for customers ordering in the restaurants to scan their loyalty card and pay in a single transaction. Right now its a two-step process, and thats slowing down the restaurants lines, the very thing it desperately needs to fix. Sweetgreen failed to have its streamlined in-store system in place and hadnt thought about its most devoted customers before changing its loyalty program. This is another example of the lack of attention to detail thats bedeviling the company right now. Theres more! Its increasing portion sizes for chicken and tofu in an effort to deliver more value for customers but has given no indication how itll pay for these changes. Its reducing hold times for items, meaning that customers should get fresher food in their orders, but without addressing the potential that has on waste and what those costs could do for its restaurant-level profit margins (currently at 18.9%, below the 20% that investors would like to see). Its in the midst of another major test for a new product: house-made beverages. Theyre about to roll out to three markets, and Sweetgreen is testing four beverages. Leadership gave no indication to investors how the presumably time-consuming process of making drinks in house will impact operations at the two-thirds of its restaurants that are already underperforming. But a source with knowledge of Sweetgreen’s operations tells me that it has adopted a “stage-gate process” for product testing and it is being used on these beverages. Sweetgreens general and administrative costs, meaning corporate overhead, are well above that of their primary competitors. In the most recent quarter, its G&A was 18.6% of sales, compared with just 11.4% at Cava. Sweetgreens labor and occupancy costs of its locations are also a higher percentage of sales. In other words, its overhead is bloated. Chasing shiny baubles Fries! Drinks! More protein! Merch! And just this week, baby goats! Theyre all manifestations of Sweetgreens proclivity to chase shiny baubles rather than obsess over its restaurants’s execution. Sources with knowledge of Sweetgreen praise Neman for acting with urgency in rolling out generous protein servings and seasonal burrata bowls, for example. But from the outside, I find that the company’s most recent moves read as more frenetic than considered. This grasping for something magic that’ll make Sweetgreen appear to be more than a restaurant chain is most evident in the founderss longstanding interest in being perceived as a tech company. The companys early adoption of digital ordering and payments was laudable.Since then, though, theyve talked about but havent really delivered on everything from blockchain-based transparency of every ingredient to machine-learning algorithms to give each diner personalized recipes tailored to their tastes. Sweetgreens biggest bet has been on a robotic make line, an automated version of the row of ingredients that could be part of your order. Known as Infinite Kitchen, Sweetgreen acquired the tech in a $50.7 million deal in 2021. The company has been rolling these out in some of its new restaurants as well as retrofitting older ones. This past quarter, it opened nine restaurants, and four of them had the Infinite Kitchen tech. In theory, Infinite Kitchen solves a lot of problems for Sweetgreen at once. The machines can provide perfect portion control to keep food costs in line. It can operate more efficiently than a team of people. But theres a lot we dont know about Infinite Kitchen just yet: Theyre expensive to install$450,000 to $550,000and tariffs could impact the price. The oldest ones havent been in operation long enough for us to know how durable they are. As Sweetgreen continues to diversify from salads and bowls to heartier meals and sides such as house-made beverages, are the labor advantages that the robotic system offers nullified? Infinite Kitchens at least represent the first effort by the company to use technology to solve its biggest problemoperationsrather than mere magic dust sprinkles to make the company look like something its not. Great restaurant chains make for the best stocks The Sweetgreen founders obsession with tech always seemed like an expression of their envy as they watched tech valuations explode in the 2010s for products created by and/or for their generational peers, from Uber to DoorDash to the overvalued tech unicorn of your choosing circa 2019. Yet it belies the reality that the best-run restaurant chains can outperform even tech darlings. Chipotle: 3,340% growth from IPO to 2015, then another almost 800% under CEO Brian Niccol from 2018 to 2024 following the companys food safety problems in the mid-2010s Dominos: 5,438% from 2004 to 2020, surpassing that of fellow 2004 IPO Google, whose stock rose 2,939% during that time Panera: From 1999 until it went private in 2017, it was whats known as a 100-bagger, meaning that a $1,000 investment grew to be worth $100,000. If you take the companys stock from its 1991 IPO to 2017, it grew approximately 4,000%. Sweetgreen stock is down almost 83% in its less than four years as a public company. Time for a change Neman, Ru, and Jammet have led their company for 18 years now. They have achieved what seemed impossible once upon a time: creating a national chain based on healthy eating and sustainability principles. The trio deserves all the credit for doing so. But its time for them to step aside and hand the reins to an experienced operator whos a proven winner to Wall Street. Right now, the founders have the luxury of making this decision on their own. Much like a tech company, the trio has voting control at Sweetgreen, even though they own a small percentage of the companys shares. That means itd be nigh impossible for an activist investor to agitate for changes. But with cash dwindlingSweetgreen had $472M at the end of 2021 and$168M as of Q2 2025at some point its going to need more capital, especially if it cant tighten up its operations to generate more cash. At that point, one could imagine whomever provides that funding might require their departure as a condition of the money. Someone new needs to come in and look at Sweetgreen and see where its model needs to change to be a sustainable, profitable business. Where does the concept need to be rethought? Should it move more food preparation to central kitchens to improve consistency and lower costs? What precisely is the vision for a Sweetgreen of the future thatll get this concept to its stated goal of 1,000 locations? (Keep your eye on Monty Moran, who just joined Sweetgreens board of directors in June. Moran was president and then co-CEO of Chipotle during its run from 2005-2015, and now hes sitting right there.) In 2019, Inc. profiled Sweetgreen and its fixation on being a tech company. This bit hits different when you read it today: One gets the sense that Sweetgreens founders, who have been at this for over a decade and are still only in their early 30s, considered the idea of building a typical restaurant chain and cashing out simply unglamorous, boring. Its a little bit of a hamster wheel, admits Ru, describing the conventional strategy. Your growth is defined by opening new restaurants and driving more customers into busy restaurants. Yeah, thats the job! Theyve had 18 years to get this right. Theyve racked up more than $900 million in losses and never turned a real profit. Theyve had a sweet ride. Lets see if someone else can do better.
Category:
E-Commerce
It hasnt been a great week for major retail stocks. Shares in both The Home Depot, Inc. (NYSE: HD) and Target Corporation (NYSE: TGT) have declined this week after posting their latest quarterly results, which disappointed investors. Now Americas largest retailer, Walmart Inc. (NYSE: WMT), is also seeing its share price decline today after reporting its latest quarterly results. Heres what you need to know. Walmart Q2 2026 earnings results On Thursday, Walmart posted its second-quarter results for its 2026 fiscal year. Here are the main takeaways: Total revenue: $177.4 billion, up 4.8% Adjusted earnings-per-share (EPS): $0.68 U.S. comparable sales: up 4.6% To put that top number into perspective, LSEG analysts had been expecting total revenue of $176.16 billion, meaning Walmart came in above expectations. In more good news, the company also raised its outlook for its net sales growth for its entire fiscal year 2026. The company had previously said it expected net sales growth for FY26 to be between 3% to 4%. Now the company says that it expects its net sales growth to be between 3.75% to 4.75%. But it wasnt all roses for Walmart. In an interview with CNBC, Walmart chief financial officer John David Rainey alluded to the elephant in every corporate boardroom across America: President Donald Trumps tariffs. In the interview, Rainey warned that tariff-impacted costs are continuing to drift upwards at the company. The higher those costs go, the more likely they are to impact Walmarts bottom lineif the company chooses to absorb the costsor impact the companys sales, if the retailer needs to raise prices, which could turn shoppers off. Yet Wall Street and economists will be happy to hear that Rainey says the company hasnt seen a change in consumer spending, suggesting that any tariff impacts have yet to dramatically change consumer spending so far. Everyone is looking to see if there are any creaks in the armor or anything thats happening with the consumer, but its been very consistent, Rainey said. They continue to be very resilient. His comments on the matter are important, as tens of millions of Americans shop at Walmart each week. Due to that, Walmart is seen as a type of bellwether for the overall health of the U.S. retail economy. A tale of two retailers Of course, not all big box retailers are created equaland neither are their quarterly results. Yesterday, Walmarts main competitor, Target, reported its Q2 2025 earnings. The company reported total revenue of $25.21 billion, which was slightly ahead of analyst estimates. But still, TGT shares got pummeled, falling over 6% for the day. One of the main reasons Target shares declined so much seems to be investor dissatisfaction with the companys same-store comparable sales. In Targets case, comparable sales decreased by 1.9% for the quarter. Walmart, on the other hand, has announced that its same-store comparable sales are trending up. The company reports that for the quarter, U.S. comparable sales increased 4.6%. Yet despite this big quarterly difference between the two retailers, Walmart shares are also falling in premarket trading. Walmart (WMT) stock price falls As of the time of this writing, WMT shares are down around 3% to $99.30 per share. The fact that its share price is retreating despite its relatively good earnings and raised full-year fiscal forecast suggests that investors are still concerned about the retail industryespecially as President Trumps tariffs continue to come into full force. If those tariffs necessitate price increases, it could negatively impact retailers’ bottom lines for the remainder of the year, particularly as the all-important holiday shopping season approaches in just a few months. Still, despite Walmarts price decline in premarket trading today, investors in the company have had reason to cheer as of late, when it comes to the companys stock price. Since the beginning of the year, WMT shares are up over 13% as of yesterdays market close. And over the past 12 months, WMT shares have surged more than 37% as of yesterdays closing price.
Category:
E-Commerce
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