All

Lululemon is accusing Costco of selling dupes of its $100 pants and hoodies for a fraction of the price

Lululemon has filed a lawsuit against Costco that accuses the wholesale club operator of selling lower-priced duplicates of some of its popular athleisure clothing.Recommended VideoLululemon Athletica claims in its lawsuit filed in the U.S. District Court for the Central District of California that Costco has “unlawfully traded” on its reputation, goodwill and sweat equity by selling unauthorized and unlicensed apparel that uses knockoff, infringing versions of its patents.Lululemon alleges that Costco is known to use manufacturers of popular branded products for its private label Kirkland brand, but that the company and the manufacturers don’t tell consumers of the connection between them for many of the Kirkland-branded products. Because of this, Lululemon claims this leads at least some shoppers to believe that Kirkland-branded products are made by the authentic supplier of the “original” products. Lululemon claims Costco doesn’t try to dispel the ambiguity.“As an innovation-led company that invests significantly in the research, development, and design of our products, we take the responsibility of protecting and enforcing our intellectual property rights very seriously and pursue the appropriate legal action when necessary,” a Lululemon company spokesperson said in a statement.Some of the products Lululemon says Costco is making duplicates of include its popular Scuba hoodies, Define jackets, and ABC pants.Lululemon claims one of the duplicates that Costco sells is the Hi-Tec Men’s Scuba Full Zip, with the lawsuit showing a screenshot image of Costco’s website showing the item priced at $19.97. Lululemon sells several men’s jackets that cost more than $100 each.Costco, based in Issaquah, Washington, did not immediately respond to a request for comment on Tuesday.Lululemon is requesting a jury trial and wants Costco to stop selling the products that it considers to be duplicates. It is also seeking an unspecified amount in monetary damages.Lulemon was in a similar legal dispute with Peloton in 2021. Two years later the companies announced a five-year partnership that included Lululemon becoming the primary athletic apparel partner to Peloton.Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.

Learn More
Lululemon is accusing Costco of selling dupes of its $100 pants and hoodies for a fraction of the price

Wall Street’s future hinges on a risky bet about what the American economy will do next

Wall Street is coasting toward the finish of its best week in the last five on Friday as U.S. stocks hang near their record levels.Recommended VideoThe S&P 500 rose 0.1% from the all-time high it set the day before. The Dow Jones Industrial Average was down 188 points, or 0.4%, as of 2:05 p.m. Eastern time, and the Nasdaq composite was 0.5% higher. Both likewise set records the day before.Stocks have rallied with expectations that the Federal Reserve will cut its main interest rate for the first time this year at its meeting next week. Such a move would give the economy a kickstart, and mortgage rates have already dropped in anticipation of it.Expectations for a cut have built as recent reports suggested the U.S. job market could hit the precise balance that Wall Street has been betting on: slowing enough to convince the Fed that it needs help, but not so weak that it will mean a recession, all while inflation doesn’t take off.A lot is riding on whether that bet proves correct. Stocks have already soared on it. And if the Fed ends up cutting fewer times than traders expect, including three this year, the market could retreat in disappointment. That’s even if everything else goes right and the economy does not fall into a recession and President Donald Trump’s tariffs don’t send inflation much higher.Investors, “and I think the Fed, are convinced that we are not on the verge of a surge in inflation,” according to Scott Wren, senior global market strategist at Wells Fargo Investment Institute.A survey from the University of Michigan on Friday suggested expectations for inflation may not be worsening among U.S. consumers. Preliminary data suggested they’re bracing for inflation of 4.8% in the upcoming year, the same as they were a month earlier.Expectations for inflation over the longer term crept higher, though they’re still below where they were in April, when Trump announced his worldwide tariffs.Record highs for Wall StreetIn the meantime, Wall Street continues to drift around its record heights.RH fell 4.7% after the furniture retailer reported profit and revenue for the latest quarter that came up short of analysts’ expectations. It also trimmed its forecasted range for revenue this fiscal year amid what CEO Gary Friedman called “the polarizing impact of tariff uncertainty and the worst housing market in almost 50 years.”Oracle sank 4.1% and was one of the day’s heaviest weights on the S&P 500 index. But that shaved only a bit off its surge from earlier in the week, when it soared to its best day on 1992 amid excitement about multibillion dollar contracts signed related to artificial-intelligence technology.Another company that’s benefited from the AI frenzy, Super Micro Computer, rose 2.9% after saying it’s begun high-volume shipments of racks using Blackwell Ultra equipment from Nvidia that can be used for AI.Global marketsMicrosoft climbed 2% after European Union regulators accepted the tech giant’s proposed changes to its Teams platform, resolving a long-running antitrust investigation.The European Commission said Friday that Microsoft’s final commitments to unbundle Teams from its Office software suite, including further tweaks following a market test in May and June, are enough to satisfy competition concerns.In stock markets abroad, indexes edged lower in Europe after rising in much of Asia.Japan’s Nikkei 225 climbed 0.9% to another record, while Hong Kong’s Hang Seng rallied 1.2% for two of the bigger moves.In the bond market, the yield on the 10-year Treasury climbed to recover some of its drop from earlier in the week. It rose to 4.07% from 4.01% late Thursday.Trump vs. The FedYields have been mostly sinking as expectations built on Wall Street that the Fed will resume cutting rates soon.The Fed has been on hold through 2025, mostly because of the risk that Trump’s tariffs could send prices for all kinds of U.S. household purchases much higher. Lower interest rates can make inflation even worse.That inaction, though, has infuriated Trump. He has threatened to fire Fed Chair Jerome Powell, whom he has nicknamed “Too Late,” and has escalated his attempt to fire Federal Reserve Governor Lisa Cook, accusing her of mortgage fraud.On Thursday, the Trump administration asked an appeals court to remove Cook from the Federal Reserve’s board of governors by Monday, before the central bank announces its next decision on interest rates Wednesday. Trump initially sought to fire Cook Aug. 25, but a federal judge ruled late Tuesday that the removal was illegal and reinstated her to the Fed’s board.___AP Writers Teresa Cerojano and Matt Ott contributed.Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.

Learn More
Wall Street’s future hinges on a risky bet about what the American economy will do next

Sadiq Khan supports “a better Heathrow, not a bigger one” as £21bn runway plans are submitted

Heathrow Airport has formally submitted detailed plans for a third runway as part of a proposed £49bn (€56.5bn) infrastructure expansion. The government claims the project could deliver major economic benefits – including the creation of 100,000 jobs – and boost the UK’s status as a global transport hub.The proposed 3.5km runway, which would require rerouting part of the M25 motorway, is projected to support more than 750 additional daily flights and increase Heathrow’s annual passenger capacity to 150 million. Airport officials say the scheme is “shovel-ready” and aim to have the runway operational within the next decade. They argue that it would unlock at least 30 new international routes.Up in the air: London Heathrow Airport(Image: Getty Images)However, London mayor Sadiq Khan remains a vocal skeptic of the expansion, despite acknowledging aviation’s contribution to the economy. Following the submission of the runway plans, Khan said he “remain[s] unconvinced that you can have a new runway at Heathrow, delivering hundreds of thousands of additional flights every year, without a hugely detrimental impact on our environment.”“City Hall will carefully scrutinise the new Heathrow expansion proposals – including the impact these would have on people living in the area and the huge knock-on effects for our transport infrastructure, which would require a comprehensive and costed plan to manage. I’ll be keeping all options on the table in how we respond.”In a recent interview, Monocle asked Khan whether Heathrow’s proposed growth could spark conflict with central government, particularly as national leaders push for accelerated infrastructure development and increased air-travel capacity:“Aviation is important for our economy but I support a better Heathrow, not a bigger one,” he told Monocle’s editor in chief, Andrew Tuck. “The noise pollution already affects more people than all major European hubs combined – and that’s with just two runways.”Looking ahead: Sadiq Khan (Image: Caroline Teo/Greater London Authority)“Air quality around the airport is still poor and a third runway would only worsen it. Plus, the Climate Change Committee says that aviation growth must meet carbon goals. Can Heathrow do that?”“Then there’s the infrastructure; rerouting the M25, tunnelling, upgrading the Piccadilly line, the Southern Rail and the Elizabeth line. It’s not the best use of money. Though I agree with the government on most issues, on this, maybe not.” As the project moves into the planning approval phase, it’s clear that the debate over Heathrow’s third runway is far from over and might become a defining test of the UK’s infrastructure priorities in the face of climate and public health concerns.Read Monocle’s full interview with Sadiq Khan here.Want more stories like these in your inbox?Sign up to Monocle’s email newsletters to stay on top of news and opinion, plus the latest from the magazine, radio, film and shop.Your EmailSubscribe

Learn More
Sadiq Khan supports “a better Heathrow, not a bigger one” as £21bn runway plans are submitted

Reflect Orbital: The aerospace startup ‘turning on the sun’ at night

Ben Nowack is obsessed with energy. The 29-year-old Cape Cod-born has explored ideas such as damming the oceans to harness the tides, flattening mountains with gravity batteries and even latching onto the moon with a vast cable. In high school, he says, he built a kind of fusion reactor as a science project.One of his ideas is now poised to take flight. The CEO of Los Angeles-based start-up Reflect Orbital plans to launch thousands of satellites into space, equipped with mirrors that can reflect sunlight to Earth. By 2030 the company expects to have enough satellites in orbit to provide solar farms with 200 watts of energy per square metre – equivalent to the sun at dawn and dusk – during the evening hours of peak consumer demand. It also hopes to sell illumination to anyone who fancies an extra hit of sunlight, from concert and festival promoters to remote construction sites. “The range of applications for our service encompasses almost anything that an individual can do during daylight hours,” says Nowack.Inverted worldAtlas-like Ben Nowack with the world(almost) on his shouldersThe premise has its sceptics – Youtube astrophysicists relish taking pot shots at Reflect Orbital – but it has also attracted serious interest. The company recently landed $20m (€17.42m) in Series A funding, including investment from Silicon Valley heavy-hitters Sequoia Capital and Lux Capital, and had an audience with Hamdan bin Mohammed bin Rashid Al Maktoum, the crown prince of Dubai, about the project.There is an emerging global interest in what might become one of the US West Coast’s signature exports within this decade: bold, upstart energy businesses. Big Tech’s embrace of power-hungry artificial intelligence and cloud computing has generated voracious demand for electricity. Now there’s a gold-rush atmosphere among start-ups seeking to innovate clean energy sources, from mini-nuclear reactors to fusion power.But Reflect Orbital is looking for ways to better harness humanity’s oldest source of energy. When Monocle visits the company’s lab in Hawthorne, a small city in Los Angeles County that’s home to a slew of aerospace start-ups, Nowack and his CTO, Tristan Semmelhack, are eager to show off their progress since founding the business in 2021. (First, however, your correspondent must show proof of US citizenship and agree not to photograph certain aspects of the satellite-making process in order to comply with laws around technology with national-security implications.)Reflect Orbital team in Hawthorne, CaliforniaAs early as next spring, the company will launch a 100kg satellite packed into a box the size of a microwave. In space, the satellite will unfurl four triangular panels creating an 18-by-18-metre surface mounted to booms, attached like sails on a ship’s mast and position itself in orbit along the line separating daytime from night-time on Earth. Nowack and Semmelhack say that the system is reactive, allowing for precision angle changes within seconds as the Earth rotates. While this first satellite can only generate about four minutes of daylight over a 5km radius, the founders say that a ring of 18 satellites trained on the same location could illuminate one spot for an hour.The technology sounds like sci-fi but it has precedents. In 1993, Russian satellite Znamya cast a 5km-wide beam the strength of a full moon onto a narrow stretch of Europe for a few hours. In April 2024, Nasa launched the ACS3, a spacecraft that successfully unfurled a solar sail, which reflected sunlight to generate propulsion.Heliostat design engineer Robert SalazarScale model of satellites in continuous orbitThe key difference between Reflect Orbital and its space-agency predecessors is that the team wants to turn a profit. The company’s 22-person crew, expected to grow fast this year ahead of the first launch, builds its own components and does much of the fabrication itself on a lean budget. The prototyping workshop is a tinkerer’s paradise of Milwaukee tools, Fiskars rotary blades and Scotch tape, and a sample reflecting sail is laid out in a brand-new “clean room”. Semmelhack, a laid-back New Yorker climber with shaggy blond hair and wearing a flannel shirt, brings out a palm-sized scrap of the ultra-thin sail material and lets it float in the air like a plastic bag.Reflect Orbital’s do-it-yourself spirit is also evident in its car park, where the team shows off a homemade, 13-metre-long oven in which carbon fibres can be baked into booms. These coil like a tape measure, keep the reflective sail taut and weigh almost nothing.Satellite booms as light as a featherBuilding the oven cost a mere $40,000 (€34,000) and took the team a month. “If we were Nasa, this would be a million-dollar device – and the project wouldn’t make any money,” says Semmelhack. “We don’t have a huge amount of capital or time, so we have to build stuff quickly and cheaply that works well enough for our purposes.”One block away is SpaceX’s original headquarters and the tip of its first successfully recovered Falcon 9 booster can be seen peeking out from among the warehouses. Elon Musk moved SpaceX from California to Texas in 2024 but talent remains clustered in Hawthorne. “It’s very easy to get things built with machinists around every corner,” says Nowack. “If you need the perfect laser weld, the guy who did it for the SpaceX and Nasa missions is here.”Nowack interned at the pioneering commercial space company and its monument, put on permanent display by Musk in 2016, is a visible reminder that proof of concept is vital in this industry if you want to be taken seriously. The clock is ticking on Reflect Orbital’s deadline to load up a rocket and deploy its first sail in the spring of 2026. Yet the commercial space industry has become astoundingly cheap by satellite-launching standards – just $6,500 (€5,500) per kilogramme, or eight times cheaper than it was on Nasa’s now-retired space shuttles – and this is presenting an opportunity for space start-ups such as Reflect Orbital that want to get their projects off the ground.In order to deploy 100 satellites per rocket launch and reap what it believes could be billions of dollars in revenue, the company is banking on the cost of joining such launches continuing to decline. It is currently fine-tuning its design in a bid to get its satellite-production costs down from $2m (€1.7m) to less than $100,000 (€85,000) per unit.Mirror, mirror in my handSenior mechanical engineer Harsha Reddy preparing test printsSpace-age handkerchief that reflects the sun’s raysTesting reflective material under high tensionWhere that revenue will come from is still uncertain. But Reflect Orbital has its theories: municipalities seeking to save on street lighting, those engaged in search-and-rescue operations, construction firms operating in remote areas that want to extend the working day – and even Arctic villages hoping to make winters more bearable (bringing light to Russia’s Far North was one of Znamya’s goals).Objections to the technology aren’t hard to imagine, not least the light pollution and its potential to disrupt the rhythms of flora and fauna. Never mind the complaints from neighbours who don’t want dawn and dusk extended. The company has had preliminary conversations with environmental groups concerned with the matter but the founders say that the light will be dispersed rather than a harsh spotlight and the technology will allow them to quickly point the satellites elsewhere. “Give us four minutes,” says Semmelhack. “If everyone hates it, we can turn it off.”That might sound like a shaky business plan but there are more remote deployments of Reflect Orbital’s technology that make sense. Semmelhack imagines lighting up a pasture at the behest of a rancher or a ceremony for a sheikh. “We have the benefit of [working across] large areas of land that are controlled by very few people.”Reflect Orbital started taking applications for its service last autumn and, according to the company, was flooded with 164,000 requests from 157 countries. The company is planning a 10-location “world tour” once the first satellites are aloft, imagining the kind of mass gatherings that a solar eclipse can attract. Sunlight on demand is a large-scale parlour trick that will generate hype. But what drives Reflect Orbital’s mission is the energy business and making the most out of solar panels, says its chief strategy officer, Ally Stone. “It’s a way to unlock value from an already financed, already operating solar asset.”Mission control for real-time satellite monitoringReflect Orbital is one of many West Coast enterprises exploring new power-generation schemes as Big Tech pledges to stay true to its commitments to net-zero emissions. For years, data centres have been popping up along the hydropower-rich Columbia River Basin. But the current grid network is insufficient, says Julia DeWahl, a Los Angeles-based angel investor and co-founder of microreactor start-up Antares. “Forecasted energy demand is a step-function increase in growth largely driven by AI,” she says.X marks the spotEvery AI-powered Google search uses 10 times the energy of a traditional search. In response, its parent company Alphabet, alongside Amazon and Meta, have pledged to support efforts to triple nuclear-power production by 2050. Microsoft is resurrecting Three Mile Island, a Pennsylvania nuclear plant infamous for a 1979 meltdown. Meanwhile, there are entrepreneurs across North America working on small scalable nuclear reactors, such as the Bill Gates-backed Terrapower, which plans to be running in Wyoming by 2030. Elsewhere, in the Seattle area, start-up Helion is working on the world’s first fusion-power plant.“After so many years of software start-ups, there’s a boom around building real things,” says DeWahl. The location of many of these companies is no accident. “There has always been so much innovation on the West Coast.”Not every idea taken from a sci-fi novel will work but there’s smart money betting that Reflect Orbital can pull it off – with the potential for a considerable return on investment too. The founders expect public support for their solar spotlight, even if that might partly be tech-bro swagger. “If you zoom out and look at this with a bit of perspective,” says Semmelhack, “this is just so cool.”

Learn More
Reflect Orbital: The aerospace startup ‘turning on the sun’ at night

How a pair of socks helped Japan’s FamilyMart convenience store become a fashion powerhouse

While Japan’s more than 50,000 convenience stores –konbini– are an indispensable part of daily life, they’ve tended to stay away from the realm of fashion, beyond offering clean underwear or perhaps an emergency shirt and tie. That all changed in 2021 when FamilyMart – operator of nearly 16,300 convenience stores in Japan – teamed up with the Tokyo fashion designer Hiromichi Ochiai to launch its own intuitively named label, Convenience Wear. The range debuted to instant success. Its unisex crew socks – white with stripes in FamilyMart’s signature green and blue – flew off the shelves. Worn by everyone from school children to the fashion set, more than 1.4 million pairs were sold in a year and the line won a coveted Good Design Award. Convenience stores had never been seen as cool and the new brand’s desirability was a shock to the system. Fashion designer Hiromichi Ochiai(Image: Steffan Dotter)From the outset, Ochiai intended Convenience Wear to be a simple proposition, in keeping with the universality of the convenience store. The decision to start with socks, the most basic staple, was easy. “In Japan,konbinirepresent this feeling of cleanliness, stability and safety,” Ochiai tells Monocle. “So, I wanted to express this very clean image and the sock seemed to be the ideal vehicle. Plus, everyone knows the brand’s iconic colours.” The socks emerged as the hero product: cheap but well made with a thick pile, they’re also antibacterial and deodorising.Ochiai, who has had his own fashion brand, Facetasm, since 2007, also had a clear vision of how he wanted Convenience Wear to appear on the shelves. “In the context of the convenience store, we knew that the design would have to be seen and understood immediately by people of all ages, occupations and nationalities,” he says. Ochiai worked with graphic designer Takahiro Yasuda and his collective, Cekai, to come up with a bold style that stands out among the hundreds of other products. “I requested that the information should be easy to understand and readable in katakana, kanji and English.” The tough, clear-plastic packaging is designed to be reused. “Reusability can be difficult with mass production,” he says. “But I thought of a style that could be opened and resealed.” The packaging also protects the products from wear and tear. “Between the 24-hour-a-day lighting and the dust, akonbiniis a very difficult environment for selling clothes.” Initially the range was limited to the socks and a few essentials – men’s undershirts, women’s tank tops, eco-bags and small hand towels – but the simplicity of the line’s design and purpose has made it easy to expand. You might find sweatshirts, stationery, handkerchiefs, packable nylon jackets and long-sleeved cotton T-shirts.FamilyMart in Tokyo(Image: Sean Pavone/Alamy)Ochiai’s own status in the fashion world has made it easier to find collaborations too. The oversized T-shirts made with Akio Hasegawa, a longtime Monocle stylist, and his brand, Cahlumn, sold out in no time. At the Fuji Rock Festival, staff wore Convenience Wear T-shirts and there were special-edition socks and hand towels. Convenience Wear’s hand towels are made in Imabari, the towel-making centre of Japan. “We’re not particularly focused on ‘made in Japan’,” Ochiai says. “But for the way we wanted to make the pieces and the ability to introduce new colours, Imabari just made sense – they could make high-quality pieces quickly.” Ochiai, who studied at Bunka Fashion College, is bringing his fashion sensibility to the less-than-fashionable shelves of the convenience store. One striking thing about the brand is its unusual colour palette. The basic blacks, whites and greys are all there but they are punctuated with sophisticated pops of colour that call for the confidence of a seasoned designer. “We use the brand to communicate,” says Ochiai. “When it’s winter, we might use warmer colours to indicate that spring is on its way. With Fuji Rock Festival, we used optimistic neon colours to reflect that it’s a friendly, family event.” Ochiai’s own brand, Facetasm, is nothing like Convenience Wear – it’s far more directional and beloved of fashion followers. But he knew what this project called for. “Boys in Japan have always looked at magazines and shops for ideas and trends; I think that the convenience store could be a similar tool,” he says. “We’re trying to build a newkonbiniculture.” Convenience Wear also reflects Japan’s particular style mix – an inimitable blend of high and low. FamilyMart made another unexpected move earlier this year when it announced that streetwear supremo Nigo – of A Bathing Ape and now Human Made fame – was now on board as the wider company’s creative director. Nigo isn’t involved in the Convenience Wear project but his arrival points to an awareness that thekonbinioccupies a unique space in Japanese society; the ideal place to catch the attention of the broadest audience possible. Ochiai says that it’s the democratic nature of the convenience store that makes his concept work. “FamilyMart talks about ‘loving yourself’, buying something for yourself in your own time and at your leisure.”Given the number and ubiquity of FamilyMarts around Japan – something with which no fast-fashion company could compete – the potential for Convenience Wear is huge. “We are already effectively the world’s largest clothing shop,” says Ochiai. The brand strayed into fashion territory with a one-off runway show in 2023, which prompted the creation of a prototype denim jacket. Ochiai, who oversees the creative direction of every product, would love to design trainers but he’s always careful to keep Convenience Wear on the functional side. An accessible price point is key but at a level where the quality still remains high. The next challenge could be to create a Convenience Wear flagship. But how to improve on the existing FamilyMart shops? They’re accessible to all, 24 hours a day. Ochiai keeps an open mind. “Nobody has tried to do what we’re doing in a convenience store,” he says. “It’s a new experience. I’m constantly experimenting with fresh ideas.” FamilyMart in numbers16,295Number of FamilyMart shops in Japan (8,412 overseas)1973Year of launch 15 millionDaily customers (in all shops in Japan)¥3.2trn (€19.6bn)Annual sales (fiscal year: March 2024 to February 2025)family.co.jpThis article originally appeared in the Opportunity Edition newspaper 2025, created in collaboration with UBS for its Asian Investment Conference in Hong Kong.

Learn More
How a pair of socks helped Japan’s FamilyMart convenience store become a fashion powerhouse

Century-old American cereal giant Kellogg is turning Italian, selling to Ferrero for $3.1 billion

Italian confectioner Ferrero, known for brands like Nutella and Kinder, is buying the century-old U.S. cereal company WK Kellogg in an effort to expand its North American sales.Recommended VideoThe Ferrero Group said Thursday it will pay $23 for each Kellogg share, or approximately $3.1 billion. The transaction includes WK Kellogg Co.’s six manufacturing plants, and the marketing and distribution of its breakfast cereals across the United States, Canada and the Caribbean.WK Kellogg’s shares were up 31% in early afternoon trading Thursday.Kellogg was founded in Battle Creek, Michigan, in 1906 after its founder accidentally figured out how to make flaked cereal while he was experimenting with granola. Kellogg still makes Corn Flakes, as well as Froot Loops, Special K, Frosted Flakes, Rice Krispies and other cereals.Kellogg now has four U.S. plants, which are located in Michigan, Pennsylvania, Tennessee and Nebraska. It also has a plant in Mexico and a plant in Canada. The company has around 3,000 employees.The current company was formed in 2023, when Kellogg snack brands like Cheez-Its and Pringles were spun into a separate company called Kellanova. M&M’s maker Mars Inc. announced last year that it planned to buy Kellanova in a deal worth nearly $30 billion.Ferrero Group, which was founded in Italy in 1946, has been trying to expand its U.S. footprint. In 2018 it bought Nestle’s U.S. candy brands, including Butterfinger, Nerds and SweeTarts. And in 2022 it bought Wells Enterprises, the maker of ice cream brands like Blue Bunny and Halo Top.WK Kellogg’s brands have been struggling with a long-term decline in U.S. cereal consumption as consumers turned to protein bars, shakes and other breakfast items. Cereal sales got a bump during the coronavirus pandemic as more families stayed home, but sales continued to decline after the pandemic eased.At the start of July, U.S. cold cereal sales were down 6% compared to the same period in 2022, according to market research company Nielsen IQ. Kellogg’s net sales fell 2% to $2.7 billion in 2024.Brad Haller, a senior partner for mergers and acquisitions at West Monroe, said Kellogg’s large distribution network and relationships with grocery chains in North America is appealing to Ferrero because it would help the European company negotiate pricing and positioning for its products.The purchase also helps Ferraro expand beyond snacks and sweets and into a meal category, Haller said. But the company also may wind up cutting Kellogg brands or shutting down manufacturing plants.“As Americans, these brands are iconic and beloved by us, but a European company buying these wouldn’t have the same nostalgia,” Haller said.Kellogg has had other issues. A nearly three-month strike by workers at all its U.S. cereal plants in late 2021 hurt sales. And last fall, dozens of people rallied outside the company’s Battle Creek headquarters demanding that Kellogg remove artificial dyes from its cereals.Earlier this year, Kellogg said it was reformulating cereals sold to schools to remove artificial dyes and will not include them in any new products starting in January.Ferrero’s acquisition, which still needs approval from Kellogg shareholders, is expected to close in the second half of the year. Once the transaction is complete, Kellogg’s stock will no longer trade on the New York Stock Exchange and the company will become a Ferrero subsidiary.Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.

Learn More
Century-old American cereal giant Kellogg is turning Italian, selling to Ferrero for $3.1 billion
...

Newsletter

Get life tips delivered directly to your inbox!

Sign Up!